Coronavirus Aid, Relief, and Economic Security Act CARES Act.

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  • ATSMAN
    Senior Member
    • Jul 2013
    • 2415

    #1

    Coronavirus Aid, Relief, and Economic Security Act CARES Act.

    It appears that the $1200 per person is an advance payment similar to the PTC. So for 2020 tax returns there will be a reconciliation calculation required. More work. I tried to cut and paste from the draft legislation but could not.


    SEC. 6428. 2020 RECOVERY REBATES FOR INDIVIDUALS.


    “(a) In General.—
    In the case of an eligible individual, there shall be allowed as a credit against the tax imposed by subtitle A for the first taxable year beginning in 2020 an amount

    equal to the lesser of

    “(1) net income tax liability, or

    “(2) $1,200 ($2,400 in the case of a joint return).

    Taxes after all are the dues that we pay for the privileges of membership in an organized society. - FDR
  • TAX4US
    Senior Member
    • Mar 2010
    • 551

    #2
    I am still confused after reading that the payment will be based on 2018 tax return. What happens to those that have ss and va pension but are not required to file. I just took in 5 2018 returns. What about these people. anybody heard a time line yet.

    Comment

    • ATSMAN
      Senior Member
      • Jul 2013
      • 2415

      #3
      If I am reading the draft of the legislation correctly Earned income would include Soc Security and Pension But not unemployment payments.

      Also the taxpayer must have earned income at least $2500 or have a tax liability greater than 0.

      Basically it is a Advance Tax Credit that is based on 2018 tax return and if 2018 tax return is not filed then 2019 tax return can be used. This leads me to infer that a similar calculation like PTC will be required in the 2020 tax return.

      Also the amount $1200 or $2400 (MFJ) reduced by 5 % for income above $75,000 ($150,000 MFJ)

      Once media announces the granular details, I am expecting people who never files to start filing at least the 2018 tax return. Also you need a valid Soc Sec #. I did not see ITIN as valid for this purpose.
      Taxes after all are the dues that we pay for the privileges of membership in an organized society. - FDR

      Comment

      • Burke
        Senior Member
        • Jan 2008
        • 7068

        #4
        Originally posted by ATSMAN
        Also the taxpayer must have earned income at least $2500 or have a tax liability greater than 0..
        Well, that is a crock. What about people below the federal poverty line who made at least that much, but net taxable income was zero? This is 2020 and you see what is happening to jobs. They are the ones who need it! Filing 2018 if you did not have a tax liability seems like a waste of time.

        Comment

        • TaxGuyBill
          Senior Member
          • Oct 2013
          • 2320

          #5
          Originally posted by Burke

          Well, that is a crock. What about people below the federal poverty line who made at least that much, but net taxable income was zero? This is 2020 and you see what is happening to jobs. They are the ones who need it! Filing 2018 if you did not have a tax liability seems like a waste of time.

          It is $2500 *OR* a tax liability greater than 0. So if they have $2500 of income (Social Security counts) but 0 tax liability, they would still qualify.

          Comment

          • Dude
            Senior Member
            • Dec 2018
            • 360

            #6
            Originally posted by TaxGuyBill


            It is $2500 *OR* a tax liability greater than 0. So if they have $2500 of income (Social Security counts) but 0 tax liability, they would still qualify.
            SS is considered earned income for this act?
            "Dude, you are correct" Rapid Robert

            Comment

            • TaxGuyBill
              Senior Member
              • Oct 2013
              • 2320

              #7
              Originally posted by Dude

              SS is considered earned income for this act?
              It was in one of the drafts. But I don't pay much attention to details until it is actually passed.

              Comment

              • Burke
                Senior Member
                • Jan 2008
                • 7068

                #8
                Thank you. I printed off what I could find on this and it was unclear. What I have says for (individuals) with low or zero net tax liabilities, it is limited to the lesser of a taxpayer's liability, such that an individual with a tax liability of less than the rebate, would receive a rebate of their 2018 tax liability, but no less than $600. Well, what tax liability is it referring to? Line 13 (income tax) or Line 15 (total tax, which includes SE taxes)? I have clergy who have no income tax liability but have big SE tax, as they have not opted out.

                Comment

                • Burke
                  Senior Member
                  • Jan 2008
                  • 7068

                  #9
                  Originally posted by TaxGuyBill
                  It was in one of the drafts. But I don't pay much attention to details until it is actually passed.
                  Hopefully, it will be this week?

                  Comment

                  • ATSMAN
                    Senior Member
                    • Jul 2013
                    • 2415

                    #10
                    Well the procedural vote failed yesterday, so now what? May be they should separate the provisions in the bill where there is bi partisan agreement and pass that ASAP and fight over what they disagree. Don't hold the entire bill hostage to political bickering.

                    What say you?
                    Taxes after all are the dues that we pay for the privileges of membership in an organized society. - FDR

                    Comment

                    • TAXNJ
                      Senior Member
                      • Jan 2007
                      • 2106

                      #11
                      Originally posted by ATSMAN
                      Well the procedural vote failed yesterday, so now what? May be they should separate the provisions in the bill where there is bi partisan agreement and pass that ASAP and fight over what they disagree. Don't hold the entire bill hostage to political bickering.

                      What say you?
                      Have you contacted your representatives with the concerns? If yes, what are they telling you?

                      Many are writing and calling their representatives more than once.
                      Last edited by TAXNJ; 03-23-2020, 08:51 AM.
                      Always cite your source for support to defend your opinion

                      Comment

                      • Burke
                        Senior Member
                        • Jan 2008
                        • 7068

                        #12
                        Originally posted by ATSMAN
                        Well the procedural vote failed yesterday, so now what? May be they should separate the provisions in the bill where there is bi partisan agreement and pass that ASAP and fight over what they disagree. Don't hold the entire bill hostage to political bickering. What say you?
                        Agree. But that won't happen. They'd never get what they want if they give it up for expediency's sake.

                        Comment

                        • ATSMAN
                          Senior Member
                          • Jul 2013
                          • 2415

                          #13
                          Originally posted by TAXNJ

                          Have you contacted your representatives with the concerns? If yes, what are they telling you?

                          Many are writing and calling their representatives more than once.
                          Yes and they don't have a live receptionist due to COVID-19. Every thing is going to voice mail.
                          Taxes after all are the dues that we pay for the privileges of membership in an organized society. - FDR

                          Comment

                          • TAXNJ
                            Senior Member
                            • Jan 2007
                            • 2106

                            #14
                            Originally posted by ATSMAN

                            Yes and they don't have a live receptionist due to COVID-19. Every thing is going to voice mail.
                            Try email. Voting taking place now
                            Always cite your source for support to defend your opinion

                            Comment

                            • ATSMAN
                              Senior Member
                              • Jul 2013
                              • 2415

                              #15
                              This is NOT the time to dicker over emission standards etc. We got a GD emergency on our hand that needs immediate attention.
                              Taxes after all are the dues that we pay for the privileges of membership in an organized society. - FDR

                              Comment

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