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COVID-19 Economic Stimulus Payments – Eligibility & How to Get Yours

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On March 27, 2020, President Donald Trump signed the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), the latest in a series of federal emergency stimulus measures to mitigate the economic fallout of the COVID-19 pandemic.

The $2.2 trillion package featured expanded unemployment insurance benefits for American workers, targeted support for industries hit hard by the pandemic, and billions in fiscal aid for small and midsize businesses.

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It also provided for the first round of cash stimulus payments to individuals in more than a decade. The last came in 2008 as the U.S. economy languished amid a worsening global financial crisis.

According to the IRS, most Americans received one-time cash payments from the Treasury Department beginning in April 2020. These payments topped out at $1,200 for adult individuals and $2,400 for married couples who jointly file tax returns, depending on income. Minor dependents receive $500 per child.

A few months later, Congressional negotiations began on a new economic aid package that, among other sorely needed measures, is widely expected to include another round of cash stimulus payments to individuals. Although much uncertainty remains, it’s likely the second round of stimulus payments will be similar to the first, if potentially more generous for parents: topping out at $1,200 for individuals, $2,400 for married couples, and up to $1,200 per dependent, including adult dependents.

Before you start thinking up ideas for what to do with your economic stimulus check, it pays to know the details. Bookmark this article for more information on your stimulus eligibility and likely payment amount, the latest updates on when to expect your payment, and news about any future rounds of economic stimulus.

Are You Eligible for a COVID-19 Economic Stimulus Payment?

Most Americans are eligible to receive economic stimulus payments — which the IRS calls “economic impact payments” — under the CARES Act. However, many won’t receive the full $1,200 allotment per adult, and some won’t receive any payment at all. Eligible recipients who typically don’t file tax returns (or didn’t file in 2018 or 2019) must file at least a simple return to ensure receipt. Note that regardless of your income or the amount you receive, you won’t owe tax on any portion of your stimulus payment.

Income Limits & Phaseouts for COVID-19 Economic Impact Payments

The maximum adjusted gross income (AGI) to receive the full $1,200 allotment per adult American is:

  • $75,000 for single filers, including married individuals who file separate returns
  • $112,500 for head-of-household filers, a common filing status for single parents
  • $150,000 per couple for joint filers

Above these thresholds, the payment amount phases out (gradually decreases) by $5 for every $100 in additional AGI until phasing out entirely at $99,000 for single filers and $198,000 for joint filers with no dependents.

If you filed a tax return in 2018 or 2019, the IRS will use your most recent AGI to calculate your payment.

Economic Impact Payments for Children

Filers who claim dependent children on their tax returns receive $500 per child, subject to maximum income limitations.

Benefits for dependent children don’t begin phasing out until their parents or guardians hit the maximum income threshold for their own stimulus payments. At that point, child payments step down by $5 for every $100 in additional AGI until phasing out entirely. The step-down rate does not depend on the number of child dependents claimed, so the final phaseout threshold rises in proportion to the total dependent count. For example, the phaseout thresholds for single or married filing separately filers with minor dependents are:

  • One child: $109,000
  • Two children: $119,000
  • Three children: $129,000

The phaseout continues to rise by $10,000 for each additional child.

If you filed a tax return in 2018 or 2019, the IRS will use your most recent return to calculate your qualifying dependent payments.

UPDATE (4/15/20): Many stimulus check recipients are reporting lower-than-expected direct deposit payments. In many cases, recipients received payments for themselves and/or their spouses but not for some or all of their dependent children.

Unfortunately, the IRS isn’t accepting calls due to the COVID-19 pandemic, won’t mail explanation letters for at least another week, and hasn’t issued formal guidance around payments for adults and dependent children.

We’ll update this guide as we learn more about the issue. For now, visit the IRS’s coronavirus information page for the latest official guidance. You can also use this handy calculator from H&R Block to confirm your eligibility and calculate your estimated stimulus payment.

Tax Return Filing Requirements for People Who Normally Don’t File Returns

Initial communications from the IRS indicated that people who don’t normally file tax returns, such as senior citizens and Social Security disability recipients, would have to file simple tax returns by the end of calendar year 2020 to claim their economic impact payments. Following a public outcry, the IRS walked back this requirement.

According to its latest update on the matter, the IRS will use information from Form SSA-1099 or Form RRB-1099 to process impact payments for people who aren’t normally required to file tax returns. Because these forms don’t include dependent information, people not normally required to file tax returns won’t receive payments for eligible dependents unless they take the extra step of filing a simple tax return.

If you choose to file a simple tax return, it must include basic information about you and your tax situation, including:

  • Your filing status
  • Your address or direct deposit bank account information
  • The number of dependents you can claim on your return (if any)

Because economic impact payments aren’t taxable, you won’t be required to file an additional return to report your economic impact payment.

If you need to file a simple tax return, there’s a good chance you can file your simple tax return with no out-of-pocket expense. Use a free tax filing resource that allows filers who meet certain income and demographic criteria to file for free.


How & When to Expect Your Stimulus Payment

To reduce costs and expedite delivery, the IRS prefers to send COVID-19 economic impact payments electronically rather than by check. However, the IRS needs up-to-date bank account information to execute electronic payments. If the IRS doesn’t have your current bank account on file and you’d prefer to receive your payment electronically, you need to take action.

How to Receive Your Stimulus Payment Electronically

If you’ve already filed your 2018 or 2019 taxes and provided your direct deposit information to the IRS (and that information is still correct), you don’t need to take further action unless you’ve closed your direct deposit account in the meantime. Expect your payment to arrive in that account sometime after April 20.

If the IRS doesn’t have a current bank account on file for you and you haven’t yet filed your 2019 taxes, file as soon as possible to ensure the IRS can process your stimulus payment electronically. The IRS extended the filing deadline for 2019 taxes to July 15, 2020, due to the COVID-19 pandemic, but filing sooner will likely expedite your economic impact payment.

If you aren’t ready to file your 2019 taxes but would prefer to receive your stimulus payment electronically, visit the IRS’s coronavirus information page and use the “Get My Payments” tool to provide your bank account information. You’ll need to confirm key details from your most recent tax return, including your AGI and amount owed or refunded, but the process should take less than 5 minutes if you have your most recent tax return handy.

UPDATE (4/15/20): If the IRS has your direct deposit information for 2018 but not 2019, you may need to use the “Get My Payments” tool to provide your bank account number, even if your account hasn’t changed. Likewise, if you apply your federal refund to your quarterly estimated tax payments rather than receive it by direct deposit (which is common for business owners and self-employed individuals), the IRS may still need your bank account information to process your stimulus payment.

How to Receive Your Stimulus Payment by Check

If you don’t mind receiving your stimulus payment by check and the IRS has your current address on file, you don’t need to take any action.

If the IRS does not have your current address on file because you moved since filing your most recent return, complete and mail Form 8822. Be sure to send this form to the appropriate IRS mailing address, which is printed on Page 2 of the form.

If you plan to file a 2019 return before the IRS begins distributing economic impact payments, you can update your address on the return.

If you haven’t filed a return recently and you’ve changed addresses since you last filed a return, you must file a simple tax return to ensure the IRS has accurate address information on file.

When to Expect Your Stimulus Payment

According to the IRS, about 80 million Americans can expect to receive their stimulus checks via direct deposit on or about April 15, 2020.

If you’re OK with (or prefer) receiving your payment by check, know that the IRS has said it could take up to 20 weeks – into September 2020 – to disburse check payments.

If you’re expecting your stimulus payment by direct deposit and haven’t received it by April 15, 2020, use the “Get My Payment” tool in the IRS Economic Impact Payments portal to learn when you can expect to receive it (and confirm that you’re eligible to receive it at all).

Within a few weeks of your payment’s issuance, the IRS will mail you a written notification stating how and when it was disbursed. If you receive this notification and can’t locate your payment, contact the IRS for more information.

Should You Expect a Second Stimulus Payment?

On May 16, 2020, the House of Representatives passed a $3 trillion stimulus package known as the HEROES Act. Among the package’s many provisions was a direct payment scheme very similar to the CARES Act’s. The scheme’s income restrictions and phaseouts were identical to the CARES Act’s, with single taxpayers earning up to $75,000 eligible for one-time payments of $1,200 each and joint filers earning up to $150,000 eligible for one-time payments of $2,400 each.

Notable differences in the HEROES Act’s direct payments scheme included:

  • Eligibility for immigrants with valid Taxpayer ID Numbers
  • Dependent payments worth $1,200 for up to three dependents of any age, including adult dependents
  • A payment cap of $6,000 per household, or $2,400 for joint-filing spouses and $1,200 for up to three dependents

Because the Senate has shown no inclination to take up and pass the HEROES Act, it’s unlikely the package will become law as written. However, the body’s Republican leadership – which controls what comes to the floor – has expressed openness to passing another coronavirus stimulus measure by the end of summer 2020. Parts of the HEROES Act, including the direct payments scheme, could make it into the final Senate-passed package (which the House would then need to pass). But it’s far too early to say for sure how any future stimulus payments will look – or whether they’re coming at all.


Final Word

The COVID-19 pandemic has already hit the economy hard. With the outbreak showing no signs of slowing, further fiscal pain — not to mention human suffering and loss of life — is inevitable.

Though some employers are hiring during the COVID-19 pandemic, most are battening down the hatches and counting on government assistance to help ride out the storm. To the extent you’re able, consider using a portion of your economic stimulus payment to support small businesses during the pandemic. They need our help now more than ever.

What do you plan to do with your COVID-19 economic stimulus payment?

Brian Martucci
Brian Martucci writes about credit cards, banking, insurance, travel, and more. When he's not investigating time- and money-saving strategies for Money Crashers readers, you can find him exploring his favorite trails or sampling a new cuisine. Reach him on Twitter @Brian_Martucci.

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