Physically, emotionally and financially, 2020 was a hard year for people across the globe. A few of the only bright spots were the two days in which many Americans received a stimulus check—also known as economic impact payments—from the government.
The question that may have popped into your mind after getting your stimulus money was whether or not you’ll need to claim it as taxable income when you go through tax preparation in Hayward, CA. Thankfully, the answer is no!
Even though the tax code says citizens must pay taxes on all income sources, the stimulus checks don’t technically count as “income.” Instead, the checks are an advance payment of a tax credit, which isn’t taxable. Additionally, the stimulus payments will not affect your tax bracket, nor the amount you owe or receive from the government after filing.
What if I haven’t gotten last year’s stimulus checks?
The amount Americans received depended on factors like their marital status, whether or not they have dependents and their current income. The first payment was up to $1,200 per person and $500 for each child. The second round of payments in 2020 was up to $600 per person, plus $600 extra for each child.
Those who made over $75,000 either didn’t get an economic impact payment or didn’t receive the full amount. Other individuals—like those who still owed for 2019’s taxes—may not have received a payment, either.
Individuals who didn’t receive economic recovery payments or didn’t receive the full amount can get the money by claiming a rebate recovery credit during tax preparation in Hayward, CA. To claim the rebate, filers must fill out an extra sheet during the filing process. If you’re claiming that you only received a partial stimulus check, you’ll need to know the exact amount you received from the government.
How can I confirm the amount I received?
If you know you received a stimulus check from the government but can’t find your bank statement or remember the exact amount, that’s okay. All you need to do is create an account on the IRS.gov website, which only takes a couple minutes. From your account home page, you can easily navigate to find the exact amount received, and the dates you received the money.
Should a professional handle my taxes?
Even tax experts are on the record saying this will be one of the most challenging filing seasons of all time. Trying to do your taxes on your own could result in a lower tax return or even an IRS audit. Ensure you get the most money back and stay out of legal trouble by hiring a professional to tackle everything for you.
Don’t leave tax preparation in Hayward, CA up to chance—hire the professionals at Menjivar & Company CPAs, Inc. to take care of your income tax returns. With over 40 years of industry experience, you can rest easy knowing your taxes will be filed accurately and in a timely manner. Give us a call today to set up an initial appointment or to learn more about our services.
Categorised in: Tax Preparation