The U.S. Government passed the coronavirus relief bill into law last week and yes, there’s a lot to take in. The good news is that this bill was passed for you. The government created this $2 trillion relief package in order to do two things. One, to put money in the pockets of indivuduals. Two, to get that money back into the economy to keep it moving during a time when everything else has slowed.
We’ve broken it down for you so that you have a greater understanding of what you can expect.
The why. People are out of work. The world is feeling the impact from coronavirus. The government wants to make sure Americans have enough money to get through the crunch, even if they have to do it in a bare bones way. Many people do not have the emergency fund they should, and even those who are out of work still have plenty of bills to pay. The CARES Act (which stands for Coronavirus Aid, Relief, and Economic Security Act) is essential, says Colin Slabach, Assistant Professor of Retirement at The American College of Financial Services, to keep Americans safe and to ensure they can pay those bills.
The checks. Treasury Secretary Steve Mnuchin says he expects most to get their checks by April 17, per the New York Times.
But how? The money will be direct deposited into the bank account where you received your most recent tax refund. If you do not have a bank account, your check will be mailed to the address used with your most recently filed tax returns — but it will take longer to receive than those that are direct deposited. If you haven’t gotten around to filing for 2019 yet, the government will pull from your 2018 returns.
Will it be counted as taxable income for 2020? No, the economic impact payments are not considered taxable income.
What else do I need to know?