04.03.20

Answering Your Questions about Rebate Checks to Americans During COVID-19

Friend –

Last Friday, the House passed and the President signed into law the Coronavirus Aid, Relief, and Economic Security (CARES) Act to provide immediate relief to workers and families, while bolstering America’s medical response to COVID-19.

I fought for a number of provisions in this bill that will help ensure Washington’s families, students, employers, health care providers, and communities have the resources and assistance they need during these difficult times. That includes providing direct assistance to individuals and providing substantial funding for programs to mitigate the economic challenges created by this crisis.

With much of the economy currently shut down, it’s important that lower and middle-income Americans can get the financial support they need to get by and continue to pay the bills. Direct assistance can play a pivotal part in that. To that end, this new law provides immediate direct cash payments—up to $1,200 for each adult and $500 for each child, beginning to phase out at an annual income of $75,000 for an individual and $150,000 for a household.

I’ve heard from a lot of folks over the past few days about what exactly that means – who’s eligible, when a rebate can be expected, and how to apply. So, I thought I’d take a minute to answer some frequently asked questions. As the response to COVID-19 continues to develop, I’d encourage you to continue to check my website for more information at Kilmer.House.Gov/Coronavirus and the Washington State Employment Security Department at esd.wa.gov.

                                                      Frequently Asked Questions

Q: Why are rebates being administered to Americans?
A: Our nation is facing one of the gravest health and economic emergencies in over 100 years. The COVID-19 pandemic has had a deep impact on every aspect of American life — and bold action is required to address the health emergency, mitigate the economic damage, and provide for a strong recovery.

Q: Am I eligible to receive a direct payment? How much will I receive?
A: Individuals making up to $75,000 ($150,000 for married workers) will receive payments of $1,200 with an additional $500 payment per minor child. The payments decrease ratably and stop altogether for single workers making more than $99,000 ($198,000 for married workers and $218,000 for a family of four).

Q. What do I need to do to apply for and receive a rebate?
A: The vast majority of people do not need to take any action. The IRS will calculate and automatically send the economic impact payment to those who are eligible.

For people who have already filed their 2019 tax returns, the IRS will use this information to calculate the payment amount. For those who have not yet filed their return for 2019, the IRS will use information from their 2018 tax filing to calculate the payment. The economic impact payment will be deposited directly into the same banking account reflected on the return filed.

Q. When will rebates be distributed?
A: The first rebates are expected to be distributed the week of April 20, 2020.

Q: Do I have to owe taxes to qualify for this rebate?
A: No. People who earn taxable income but do not typically file a tax return will need to file a simple tax return to receive an economic impact payment. Low-income taxpayers, senior citizens, Social Security recipients, some veterans, and individuals with disabilities who are otherwise not required to file a tax return will still qualify for direct payments.

Q. Will receiving this rebate hurt my eligibility for social safety net programs?
A: If you receive Social Security, retirement, or other social safety net benefits, you may still qualify for direct payments. These payments will not be taxable nor represent “resources” for program eligibility purposes. 

Q: I’m a senior, or someone who doesn’t typically file a tax return. If I’m eligible, what do I need to do to receive a debate?
A: For Social Security beneficiaries who do not file returns, the Treasury and the IRS announced on April 1st that these beneficiaries will not need to file a “simple tax return” to receive their rebate. Recipients will receive their rebate just as they would their Social Security benefits. 

For other taxpayers who do not file returns, the IRS expects to release the “simple tax return” referred to in a recent IRS News Release “soon.” The IRS expects it will contain only a few questions, including name, SSNs, dependents, and deposit information. There also will be other IRS guidance accompanying this simple tax return.

Information on the process to filing will become available in the coming days. In the meantime, please continue to visit the IRS Coronavirus updates page by clicking here.

These payments will not be taxable nor represent “resources” for program eligibility purposes. 

Q. I have not filed my tax return for 2018 or 2019. Can I still receive an economic impact payment?
A: The IRS urges anyone with a tax filing obligation who has not yet filed a tax return for 2018 or 2019 to file as soon as they can to receive an economic impact payment. Taxpayers should include direct deposit banking information on the return. The IRS has provided additional information about tax filing here. For those concerned about visiting a tax professional or local community organization in person to get help with a tax return, these economic impact payments will be available throughout the rest of 2020.

Q: We have filed and paid our taxes for the 2019 Tax Year. However, we do not have direct deposit information on file. What can we do so we are not waiting three months for our rebate checks?
A: In the coming weeks, the Treasury plans to develop a web-based portal for individuals to provide their banking information to the IRS online, so that individuals can receive payments immediately as opposed to checks in the mail. Please continue to visit the IRS for updates by clicking here.

Q: My child is still in high school but is 18 years of age. Can they be considered a child eligible for an additional $500 under this bill?
A: No. Under the CARES Act, a qualifying child for the purposes of the recovery rebate is any dependent of a taxpayer under the age of 17, consistent with the definition of a qualified child under the Child Tax Credit. Read on below about efforts I’m taking on in Congress to help fix this issue. 

Q: My parent(s) still claim me as a dependent on their taxes. Am I still eligible for a rebate check?
A: No. You cannot receive an economic impact payment if someone else claims you as a dependent on their tax return. If you are under the age of 17, your parents will receive a $500 rebate. Unfortunately, the CARES Act failed to provide rebates for the thousands of high school and college age students between the ages of 17 and 24 who are dependent on their parents and are experiencing the financial impacts of the COVID-19 epidemic. I am sponsoring a bill that would fix that error and allow parents to receive a $500 rebate for dependent children up to the age of 24, by ensuring that the more expansive definition of a qualified dependent is used instead.

Q: Can I still receive a rebate if I owe the IRS money?
A: Yes. The bill turns off nearly all administrative offsets that ordinarily may reduce tax refunds for individuals who have past tax debts, or who are behind on other payments to federal or state governments, including student loan payments.

Q: Can I still receive a rebate if I owe child support?
A: No. The only administrative offset that will be enforced applies to those who have past due child support payments that the states have reported to the Treasury Department.

Beyond that, we all know there’s more work to do. Congress is already beginning work on a fourth emergency response bill. Among other things, it’s expected that this fourth bill will be focused on infrastructure investments to restart the economy as well as other resources to help those in need. If you have an idea for how the federal government can help – or a concern you think isn’t being addressed – please reach out to me and my team.

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Please be safe and stay well. As always, I’m honored to represent you.

Sincerely,
Derek