The coronavirus pandemic has affected all areas of our lives, including how we will be paying our taxes this year. If you filed taxes during 2018 or 2019, and made less than $75,000 (or $150,000 for married filing joint) you should be getting a stimulus check soon! While almost all forms of income are taxable, you won’t need to pay taxes on the stimulus check. Here’s what you need to know about how the coronavirus pandemic has affected the 2020 tax season:
1. The stimulus checks are for refundable tax credits
Stimulus checks are considered refundable tax credits, which means that you will not have to pay taxes on them. However, unlike many other tax refunds, the amount that you receive will not depend on your income. If you have any dependents, you will receive an extra $500 for each dependent in your household, which makes it more important than ever to claim all of your dependents this year.
2. The stimulus check can be based on either your 2018 or 2019 taxes
Even if you didn’t file your 2019 taxes, that doesn’t mean you won’t get a stimulus check this year. The government can look at your 2018 taxes for your stimulus check instead if you haven’t filed yet this year. You’ll also have longer than usual to file your taxes this year! In fact, the deadline to file taxes has been extended until July 15th.
3. It’s still important to file your 2019 taxes as soon as possible
Despite the fact that you have longer than usual to file your taxes, it’s still important to file your 2019 taxes as soon as you can. Make sure that you maintain complete records of your income last year to ensure that you are able to file your taxes correctly. If you hire a CPA, you can be sure that your taxes will be filed on time.
4. If the IRS overpays you, you won’t have to pay them back
While you’ll usually owe money to the IRS if they overpay you, this is not true now. If you pay the IRS more than you actually owe in taxes, you will receive a refund, which is a continuation of the policy that the organization had prior to the pandemic.
