The non-filer NRIs in the US and the Economic Impact Payment co-relation

The non-filer NRIs in the US and the Economic Impact Payment co-relation

by | Jun 18, 2020 | Adjusted Gross Income, Economic Impact Payment, EIP Correlation, Non Filer EIP

The non-filer NRIs in the US and the

Economic Impact Payment co-relation

The US Government has passed the CARES Act under which the US citizens and the US resident aliens would be receiving Economic Impact Payments (EIP). This is an initiative by the Federal Government to provide aid and alleviate the economic stress caused to the Americans due to the pandemic COVID-19. The IRS would be calculating and sending the Economic Impact Payments (EIP) to the eligible Americans. Currently, millions of Americans have already received their EIP and many more EIPs are being processed by the IRS.

Eligibility for the receipt of Economic Impact Payment (EIP)

The US citizens, permanent residents, and qualifying resident aliens can receive the EIP if

  1. They have a valid Social Security Number
  2. They have not been claimed as a dependent of any other taxpayer 
  3. They have Adjusted Gross Income (AGI) under certain limits. 

The US citizens and the US resident aliens would receive $1200 or $2400 as EIP depending upon certain criteria. The threshold for Adjusted Gross Income (AGI) of the Americans to receive the EIP is noted below.

  1.  Adjusted Gross Income (AGI) up to $75,000 for those filing tax returns as Single 
  2. Adjusted Gross Income (AGI) up to $150,000 for those who are married couples and are filing their tax returns jointly.
  3. Adjusted Gross Income (AGI) up to $112,500 for the head of household filers.

For those eligible taxpayers who have filed the tax returns for 2018 or 2019, the EIP would be received automatically. Moreover, those eligible retirees who do not file a tax return but are recipients of SSR (Social Security Retirement), Railroad Retirement benefits, Supplemental Security Income, VA Compensation, and Pension, etc. would obtain their EIP automatically.

Non-filer NRIs and their EIP

However, some NRIs or resident aliens might be having low income or not filing tax returns. These non-filer NRIs are also eligible for obtaining their EIP but they will have to enter their information with the help of the IRS webpage.

The IRS webpage consists of a tool “Non-Filers: Enter Payment Info Here” by which the non-filer NRIs can enter their payment information. This information can be used by the IRS to issue the EIP for the Non-filer NRIs.

An NRI would not be required to file a federal income tax return for the year 2019 due to any of the below-mentioned reasons.

  1. If the income of the NRI is less than $12,200 then there would be no necessity to file the Federal Income tax return for the year 2019.
  2. In case the NRI is married, filing his Federal tax returns jointly with his spouse and has an income less than $24,400 then he would not be filing the Federal Income Tax Return for 2019.
  3. If the NRI has no income, then he would not file the Federal Income Tax Return.

Information needed to be provided by the NRI

The non-filer NRI needs to provide some important information in the “Non-Filers: Enter Payment Info Here” tool to obtain his EIP.

  1. Full Name of the NRI, his email address, and present mailing address.
  2. NRI’s date of birth and Social Security Number (SSN).
  3. Bank Account Number of the NRI
  4. Driver’s license or any ID issued by the State Government.
  5. IP PIN (Identity Protection Personal Identification Number) provided by the IRS in the previous year. In case an NRI has lost the IP PIN, then he must log in to another IRS tool i.e. “Get an IP PIN” for obtaining a new IP PIN.
  6. For every qualifying child in the year of 2019, the NRI has to share details such as Name of the child, child’s Social Security Number, Adoption TIN, and his relationship with the NRI or with his spouse.

Procedure to use “Non-Filers: Enter Payment Info Here” tool

  1. An account must be created by the use of an email address and phone number. By this, the NRI would obtain a user ID and password.
  2. In the next step, information related to the filing status such as “Single” or “Married filing jointly” need to be filled up along with other personal information.
  3. A box asking whether the NRI or his spouse can be claimed as a dependent by someone must be checked.
  4. Further, bank information needs to be entered followed by another screen where the NRI can enter his personal information to verify himself. 

 With this, the procedure to complete the Non-Filers information is completed and an acknowledgment would be received by the NRI regarding the completion of the procedure. The Free Fillable Forms, a trustworthy partner of the IRS would use this information and complete Form 1040, compute the EIP, and send it to the recipient.

References

https://www.irs.gov/coronavirus/non-filers-enter-payment-info-here

https://www.irs.gov/newsroom/non-filers-enter-payment-info-here-tool-scenarios

https://www.irs.gov/coronavirus/economic-impact-payment-information-center#:~:text=U.S.%20citizens%20and%20U.S.%20resident,married%20couples%20filing%20joint%20returns

 

When you file your 2019 tax return will impact your stimulus payment?

When you file your 2019 tax return will impact your stimulus payment?

by | Mar 30, 2020 | Adjusted Gross Income, COVID - 19, federal income tax, income tax credit, SSN, tax filing, Tax Payers, tax return, taxes, US Government

Calculate your Stimulus Eligibility

When you file your 2019 tax return will impact your stimulus payment?

File your 2019 tax return will impact your stimulus payment, The pandemic COVID-19 continues to have a huge impact on the citizens of the USA. The Federal Government has been taking several steps to alleviate the burden that the common people might be facing due to this dreadful disease. One major step taken by the US Government to help out the common people in easing tax-related stress is by the passing of a $2 trillion stimulus bill. This bill includes a provision by which several citizens of the country would receive stimulus cheque from the Federal Government.

Eligibility for obtaining stimulus cheque

You can qualify to obtain the stimulus cheque from the Federal Government if the below-mentioned conditions are met.

  1. If you are a US resident who is single and have an adjusted gross income which is less than $99,000.
  2. If you file your tax returns as the head of the household and earn an amount below $136,500.
  3. If you are filing your tax return jointly without any children and would earn an amount less than $198,000. 

How to obtain the stimulus cheque    

For obtaining a stimulus cheque, a person should have a Social Security number and should be the residents of the United States. The amount you can receive as a stimulus cheque is based on the adjusted gross income (AGI) that has been listed in your latest tax returns.

The IRS would be using the direct deposit information that you have provided during filing your last tax returns. In case your bank details have not been mentioned while filing the last return, the IRS would send the cheque to the recent address it has. It is also advisable to notify the IRS if you have shifted your house recently. 

Factors affecting the stimulus payment

There are some major factors which can affect your stimulus payment such as

Filing status-If you are single you can receive $1200 as your stimulus payment, but for a married couple who are filing the income tax returns jointly the stimulus payment is $2400.

Size of your family-The stimulus payment also depends on the size of your family and for every child of yours who is below the age of 17 years; the stimulus payment is an additional $500.

Dependent-In case if you are claimed as a dependent on the tax returns of someone else then they would not be receiving any stimulus payment.

Level of your income-If you have a high income, the stimulus payment depends on the level of your income. For a married couple filing returns jointly, the stimulus payment starts reducing if the AGI exceeds $150000 and the same thing can occur for taxpayers who are single and their income exceeds $75000.

 

However, there is another factor is important in determining the stimulus payment and that is whether the tax returns for the year 2019 have been filed or not.

When are you filing your 2019 tax return?

Firstly, the IRS would always check out for tax returns related information for the year 2019 for making the stimulus payment. If there is no information available for the year 2019, the IRS would use the information for the year 2018.

In case, you have a Social Security Number but do not need to file the tax return then your stimulus payment would be done based on the information present in Form 1099-SSA.

This can be utilized as an opportunity by several taxpayers and if you have not filed or prepared your tax returns of 2019, then he can take into consideration the variables like Adjusted Gross Income, family size, etc. to determine higher stimulus payment to occur in which the year 2018 or 2019. 

If, you feel that the payment was better in 2018 than you would hold on to that information or else if the returns of 2019 tend to yield more results then you should file your returns immediately.

Moreover, you must also consider any refund which you might obtain from the 2019 tax returns. It is quite obvious that you will have to make a decision i.e. either a large refund now and a smaller stimulus or larger stimulus immediately and the same refund after some months. 

 

Stimulus payment can be said as an advanced payment which you would make against the actual credit that will be computed on the tax returns of 2020.

  1. In case your advance payment done is less than what you would owe while computing the tax returns of 2020, then the excess would be obtained as a credit on the tax returns. 
  2. However, if advance payment is greater than what you owe while filing 2020 returns then there is no procedure to repay the excess amount or in recognition of the excess amount as income.

Conclusion

Hence, your stimulus payments are highly determined by when you are filing your tax returns. If you have not filed your tax returns for 2019 yet then you must consider if the tax return filing would either increase your stimulus payment or decrease it and then pursue your actions accordingly.

References

https://www.forbes.com/sites/anthonynitti/2020/03/26/when-you-file-your-2019-tax-return-will-impact-your-stimulus-payment/#32168a96b9dc

https://finance.yahoo.com/news/bigger-stimulus-check-waiting-file-123220996.html

https://www.cnbc.com/2020/03/26/coronavirus-stimulus-checks-heres-everything-you-need-to-know.html

https://www.bloomberg.com/news/articles/2020-03-26/when-and-how-will-i-get-that-1-200-stimulus-payment-quicktake

https://www.cnet.com/how-to/coronavirus-stimulus-check-is-official-find-out-if-youre-eligible-for-up-to-1200/

https://www.businessinsider.in/finance/news/how-to-get-a-stimulus-check-from-the-us-government-which-could-pay-up-to-1200-if-you-qualify/articleshow/74837139.cms