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

[ATSMAN]

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).

[TAX4US]

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.

[ATSMAN]

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.

[Burke]

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.

[TaxGuyBill]

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.

[Dude]

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?

[TaxGuyBill]

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.

[Burke]

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.

[Burke]

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?

[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?

[TAXNJ]

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.

[Burke]

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.

[ATSMAN]

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.

[TAXNJ]

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

[ATSMAN]

This is NOT the time to dicker over emission standards etc. We got a GD emergency on our hand that needs immediate attention.