The COVID-19 pandemic has impacted the lives of many — from getting sick yourself or knowing someone with a positive test result to losing a job or business to being stuck inside working remotely. There have been a lot of obstacles to overcome. Because of the impact on the economy, many United States citizens received stimulus checks from the government.
While everyone likes waking up to a surprise deposit in their bank account, it might leave you with a lot of questions.
What are the qualifying factors to receive the money?
Will you need to pay taxes on the stimulus check?
There’s no reason to stress about your stimulus check as you head into tax season. To help you better understand who receives stimulus checks, how you’ll receive the payment, and if the payment will be taxed, AA Tax & Accounting Services, LLC has put together a quick guide to answer some of the most common questions about the stimulus checks.
Who Qualifies for a Stimulus Check?
Individuals will receive a stimulus check if they:
- Have a social security number – Those with a social security number are eligible to receive the stimulus payment, as well as an additional payment for any children in the household with a social security number.
- Are not claimed as a dependent – If claimed as a dependent, the individual will not be eligible to receive the stimulus check. The person claiming them would receive it.
- Earned within the qualifying bracket – Individuals filing taxes solo and earned less than $87,000 are eligible to receive the payment. For joint filers, they must earn less than $174,000 jointly to receive the stimulus check. Those earning more than the specified amount will receive a reduced payment.
These are only a few of the qualifications to receive a stimulus check, but the most common ones to be aware of.
How Will You Recieve Your Stimulus Check?
If you continue to be eligible for upcoming stimulus checks, you’ll continue to receive them the same way you have previously. The three ways for you to receive a stimulus check are through a direct deposit (which will automatically be set up if you received your 2019 tax return via direct deposit), a paper check that you will receive by mail, or by a debit card.
If you did not receive any of the stimulus checks that went out in 2020 or early 2021 but were eligible for the payment, it’s not too late to receive it. When filing your tax return this year, you can claim the tax credit.
Will I Need to Pay Taxes on My Stimulus Check?
If you are eligible to receive a stimulus check, you will not be required to pay taxes on the payment when you file your tax return this year — this goes for stimulus checks received in both 2020 and 2021. In addition, your stimulus payment will not be counted as income used to determine your eligibility for government assistance.
Tax Consulting Services in Cedar City, Utah
Do you still have questions regarding stimulus checks?
If so, AA Tax & Accounting Services can help you better understand the stimulus check process and how it impacts your tax returns. No one should go into tax season with their questions unanswered. Our team of tax consultants has the experience navigating the most effective strategies for maximizing their deductions and tax credits with our tax consulting services.
The AA Tax & Accounting Services team can help you execute the right tax strategies to save you money. Contact us to schedule an appointment.