While everyone waits to find the official word that new stimulus checks are coming soon, there is a significant update to be aware of regarding their connection into your most recent tax return.
Assessing your 2020 tax return too soon may really hurt your chances of getting the full $1,400 stimulus check amount.
That’s because income is what determines the stimulation check eligibility.
Tax season is now squarely upon us, which means that the race is on to receive your 2020 tax return prepared, finalized, and submitted to the IRS ahead of this year’s April 15 deadline. However, the tax agency has stated it’s extending that deadline for Texas residents due to the brutal winter there that, among other things, left many without electricity for days and even contributed to several deaths. Texans have until June 15 to receive their 2020 tax return submitted, a deadline extension that will also be given to other states where FEMA likewise issued disaster declarations due to the winter storms.
Meanwhile, as you’re getting your tax return squared away it might also be helpful to keep in mind a seemingly unrelated item that’s actually quite attached to it: Your brand new stimulus assess, the one coming quite soon, likely in the sum of $1,400, from the Biden administration.
Many people like to file their taxes as early as you can, get it out of their way, and get the ball rolling on their tax refund coming sooner rather than later. This year, however, doing so might really hurt your odds to get the complete $1,400 stimulation check coming as a result of Biden’s $1.9 trillion economic stimulus legislation. Here is why:
Eligibility for the full stimulus check amount, or even a phased-out version of it, will almost certainly be income-dependent — we say”almost,” only because the language of this $1.9 trillion stimulus package hasn’t been finalized yet. The IRS is your bureau sending out these tests, and it will be that the IRS checking your latest tax return to choose how large your next stimulation check is.
The problem here, as we have explained in the past, is over which year’s financial picture you want the IRS to have when the tax bureau makes its decision on your stimulation check. Right now, the IRS has your 2019 tax information on file. Compare that, however, to the subsequent year, 2020, once the coronavirus pandemic ravaged people’s lives and incomes this past year. Can the pandemic leave you worse or better off, financially?
If your tax/financial situation really improved in 2020, it might behoove you to wait and hopefully let the stimulation checks be sent out (together with the IRS basing off your amount your 2019 information), before filing your 2020 taxes. But if you had a child in 2020, if you got married in 2020 (in case your incomes united come in below the $\), then 00 threshold), or in the event that you might be claimed as a dependent on someone’s 2019 tax yield, but not their 2020 tax return, you’ll want to hurry up and file your own taxes.
Again, because your income is what is used to determine your eligibility for your new stimulation checks, just remember that will be dependent on the most recent tax information that the IRS has on file for you.