2020 tax returns could impact eligibility for coronavirus relief payments should the government pass a new bill.
According to tax professionals, some people should file their 2020 taxes as soon as possible to be eligible for the next round of stimulus checks.
CBS News reports a 2020 tax return can prove a person’s financial status has changed since the last filing. The government uses the most recent tax return when determining stimulus check payments.
If a citizen made drastically less last year than in 2019, or have since divorced, had a child, or other impactful changes, and their taxes are filed before the next coronavirus relief bill is passed, their income would be stated by the most recent, and accurate, tax return.
“I would suggest that people file as soon as possible, especially with 75% of taxpayers last year receiving a tax refund close to $3,000,” said Lisa Greene-Lewis, a tax expert at TurboTax, to CBS News. “We are hearing a lot of people say, ‘I had a baby in 2020, how will the IRS know this? When they issued the previous stimulus payment they didn’t know that.'”
Mark Jaeger, director of tax development at TaxAct shared with the outlet that there is, however, another aspect to filing quickly. If a person’s income became higher in 2020 yet they are still in need of a helpful stimulus check, it may be best to hold out and await the passage of a new relief bill before filing.
“You are now in that threshold of phasing out,” Jaeger said to CBS News. “You are better waiting because the IRS will use your 2019 info,” when issuing another round of relief aid.
Additionally, the Internal Revenue Service may make room for adjustments at a later date, according to the report.
“The IRS is keeping an eye on the stimulus bill taking shape in Congress and “building a number of contingencies based on any new legislation,” said Ken Corbin, the new chief taxpayer experience officer at the IRS, according to the report. “We are thinking through what is that experience for taxpayers who might be entitled for more.”
As theGrio reported, President Joe Biden has urged Congress to quickly pass a new relief bill. Biden proposed his $1.9T stimulus proposal shortly after his inauguration.
“We don’t have a second to waste when it comes to delivering the American people the relief they desperately need,” the president tweeted according to the report. “I’m calling on Congress to act quickly and pass the American Rescue Plan.”
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The post Experts suggests some should file taxes quickly before third stimulus check appeared first on TheGrio.