HR 748, The
Coronavirus Aid, Relief, and Economic Security (CARES) Act
March 30, 2020 the House of Representatives passed House Representatives 748, The Coronavirus Aid, Relief, and Economic
Security (CARES) Act. Representative Paul Cook (R-Apple Valley) supported the
which was enacted into law after the President signed it. One key component of HR748
includes direct cash assistance, also known as recovery rebates.
Recovery Rebate Eligibility:
Q: What is a recovery rebate?
A: Recovery rebates are a new refundable tax credit for taxpayers’ 2020 taxes
that were created by the CARES Act. Unlike most tax credits, recovery rebates
are paid out immediately to Americans who qualify to receive them. This means
that an American who qualifies for a $1,200 recovery rebate will receive a
check (or direct deposit) for $1,200 within a few weeks, rather than having to
wait until his or her 2020 taxes are filed next year.
Q: Who qualifies for a recovery rebate and how much will an
A: All U.S. legal residents with an adjusted gross income under $75,000 (under
$112,500 for head of household and under $150,000 married) who are not the
dependent of another taxpayer and have a valid Social Security Number qualify
for the full $1,200 rebate ($2,400 for married couples). They are also eligible
for an additional $500 per child, limited to child dependents under the age of
Q: What happens if my adjusted gross income is higher than those
A: You still can qualify for a reduced payment if you are single and your
income is less than $99,000, $146,500 for head of household filers with one
child, and $198,000 for couples filing jointly with no children. The rebate
amount is reduced by $5 for each $100 of adjusted gross income that exceeds the
Q. What is adjusted gross income?
A. Gross income includes your wages, dividends, capital gains, business income,
retirement distributions, and other income. Adjustments to gross income include
contributions to a retirement account, alimony payments, student loan payments,
and other items. For most taxpayers, the largest adjustment to their gross
income will be the “standard deduction” ($12,000 for individuals, $18,000 for
heads of household, and $24,000 for married couples). You find your Adjusted
Gross Income amount by subtracting these adjustments from your gross income
amount. (Gross income – Adjustments = Adjusted Gross Income.) Your previous
year’s tax return contains these figures.
Q: What do I need to do in order to receive my rebate?
A: For most people, you don’t have to do anything. Your rebate will be
transmitted either electronically or by paper check, depending on how you
received a refund or paid your taxes on the last tax return you filed. If you don’t
file taxes, you will receive your rebate in the same method you receive your
social security benefit.
Q: Will seniors whose only income is from Social Security or a
veteran whose only income is a veterans’ disability payment qualify for a
A: Yes. You must have a valid Social Security number to receive this rebate,
meaning individuals who receive Social Security benefits are eligible. If you
don’t file taxes, the IRS can use your Social Security Benefit Statement (Form
SSA-1099) or your Social Security Equivalent Benefit Statement (Form RRB-1099)
to determine the amount of your stimulus check.
Q: Is this direct cash assistance money taxable?
A: No. The recovery rebate money is not taxable because it’s treated like other
refundable tax credits, such as the Earned Income Tax Credit, and is not
Q: What if I haven't filed my 2019 tax return?
A: Your rebate will be based on your 2018 return.
Q: Will I have to pay back any amount if the recovery rebate,
based on my 2019 adjusted gross income, is more than what it would be if based
on my 2020 tax return?
A: No. Even if your adjusted gross income on your 2020 tax return suggests an
overpayment of rebates because your income was higher in 2020 than in 2019, you
should not owe anything.
The following taxpayer scenarios can help illustrate how your income, filing
status, or family status will impact your stimulus payment:
Senior making $16,800 per year from Social Security
Total Refund: $1,200
Single Mother making $30,000 per year
Total Refund: $1,700
Family of Four making $59,000 per year
$2,400 (For filing jointly)
$1,000 ($500 per child)
Total Refund: $3,400
Family of 5 earning $73,000 per year
$2,400 (For filing jointly)
$1,500 ($500 per child)
Total Refund: $3,900