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Your Last-Gasp Shot at a Stimulus Check Is Coming: Here's How It'll Work

By Dan Caplinger – Jun 2, 2020 at 11:01AM

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If you didn't qualify to get a check yet, you still have one more chance.

The COVID-19 pandemic has taken its toll on the global economy, and people across the globe are struggling to get by. In the U.S., the federal government responded relatively quickly with an aid package including stimulus checks that paid tens of millions of families $1,200 per adult and $500 per child. Moreover, there's been plenty of talk about a potential second round of stimulus checks, with measures like the House-passed HEROES Act putting more economic aid on the table.

Yet there's still a substantial group of people who haven't yet gotten their first stimulus checks. For some of them, income limitations kept them from qualifying to receive checks. However, even those who didn't qualify still have one last shot to get some stimulus money. Not everyone will be successful, and even those who are will have to wait longer than they'd like. Nevertheless, it could mean the difference between getting a stimulus check and not getting anything.

Here's what you'll need to do and how it'll work.

The Treasury building in Washington, labeled "The Treasury Department" at the front entrance

Image source: Getty Images.

What the stimulus checks really are

To understand why there's still a chance to get a stimulus check even if you haven't qualified for one yet, you have to look at the legislation that created stimulus checks in the first place. Technically, the law governing stimulus checks established a refundable tax credit for the 2020 tax year. It also authorized the Treasury Department to make advance payments of that refundable tax credit, but obviously, no one knows what people's final incomes for 2020 will be. That meant the Treasury Department couldn't base advance payments on actual 2020 income numbers, so instead, the law allowed the use of 2019 or 2018 tax return information in deciding who should receive stimulus checks now.

Lawmakers could have included provisions that would allow the government to claw back advance payments based on preliminary information that turned out not to be accurate for 2020. In other words, if someone qualified based on 2018 or 2019 income but didn't based on 2020 income, the law could have allowed the government to grab back that stimulus money. However, lawmakers explicitly wanted that not to happen, so the government assured taxpayers they wouldn't have to repay stimulus payments even if they wouldn't actually qualify if they had to use their 2020 income number.

Another bite at the apple

It's rare that the IRS gives you the best of both worlds, but with stimulus payments, that's exactly how it'll work. When you file your 2020 tax return, you'll have another chance to qualify to receive a check from the government. If your 2018 or 2019 income was above the limits -- for those without children, $99,000 for singles and $198,000 for joint filers -- but your 2020 income was below, then you'll get at least some money back from the government. If your 2020 income is below $75,000 for singles or $150,000 for joint filers, then you'll get the full amount of your stimulus payment.

That's especially important because many people will unfortunately see their incomes drop substantially in 2020. With tens of millions of layoffs and others facing work stoppages and temporary furloughs, there'll be plenty of taxpayers who didn't qualify earlier but will qualify now.

Technically, the stimulus payment will be part of your overall tax refund. The earlier you file in 2021, the sooner you'll be able to get it -- along with any other refund money you're eligible to receive.

Don't throw away your shot

With many people not even having filed their 2019 tax returns yet, it's admittedly early to try to plan for your 2020 taxes. Moreover, there's still plenty of uncertainty about whether there'll be a second round of stimulus checks or not. A lot could change between now and the end of the year.

Nevertheless, it's smart to have an idea of exactly what your last-gasp grasp at your initial stimulus payment might look like. That way, you'll be ready to move forward when you can -- and get whatever money you have coming to you to help make ends meet during these tough times.

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