Does the first stimulus check of up to $1,200 count as income for next year’s taxes? What about taxation on a second check? And what happens if your income changed between the first check and the arrival of a second — when and if that happens?
It turns out that taxes are critical when it comes to stimulus checks. They help determine how much money you’re entitled to and who even qualifies for a direct payment in the first place, from dependents to adults.
We’ll help answer all your questions about how taxes and stimulus checks go together. And here are the most important things to know about stimulus checks overall.
Can I be taxed on my stimulus payment?
No, a stimulus payment does not count as income and you won’t owe tax on it, the IRS has said.
How do taxes determine the size of the stimulus check?
The IRS uses the adjusted gross income, or AGI, from your 2019 federal tax return (or your 2018 return if didn’t file one in 2019) to calculate your payment scale. Your AGI may be a different figure from your annual salary or take-home pay based on a variety of factors.
The income limits that decide exactly how much of the $1,200 per adult your household gets — and if you’re qualified to receive a check in the first place — stem directly from the AGI on your last batch of taxes, not necessarily what your income is at the time the checks go out…Read more>>
Source:-cnet
Share: