**UPDATE** The IRS released a new version of its Non-Filer tool that enables those who do not ordinarily file a tax return to quickly and conveniently file a simple return to claim any missing or inaccurate stimulus payments. Visit MTR's Get Your Stimulus Payment page to find out more information.
In October 2020, the IRS announced that approximately 9 million eligible individuals had not yet received or claimed their Economic Impact Payments (aka stimulus checks or "stimmy"). We're talking about a minimum of $3,200 per person, and much more for married individuals and those with children. These funds have the potential to meaningfully impact financial well-being, especially for those experiencing homelessness. Unfortunately, though, many in the homeless community experience significant barriers with accessing the stimulus funds, including a lack of awareness regarding both eligibility and the process for claiming the funds. So, in partnership with the Center for Advancement of Tax Equity, we put together the following short informational video to: (1) make clear the eligibility requirements for the stimulus payments; and (2) explain the current process for obtaining any missed or unclaimed payments.
Help us spread the word by sharing this information throughout your social media channels and with civil organizations within your local community.
How much money are we talking about?
Over the course of the last year, Congress authorized the issuance of three separate rounds of stimulus payments—$1,200, $600, and $1,400. In total, we’re talking about a minimum of $3,200 in stimulus payments per person, and that amount is much higher for married individuals or those with children. Note also that the stimulus payments are NOT subject to federal tax, which means individuals do not pay federal income tax on any portion of these funds. And many states have passed similar laws exempting the funds from state income tax.
Eligibility for the stimulus payments
Let's set the record straight about eligibility for the stimulus payments—surprisingly, there is A LOT of misinformation and confusion regarding this. Here's the deal, you are entitled to receive the stimulus payments if you satisfy the following three requirements:
You must be a United States citizen or resident alien;
You must not have been claimed as a dependent on another person’s tax return (this is particularly important for college-age students, as parents will often claim them as a dependent on their return); and
You must have a Social Security number that is valid for employment. Note that if you’re a U.S. citizen and have a Social Security number, it is valid for employment purposes.
In addition to the three requirements listed above, there are also income limitations. However, if you had an adjusted gross income of $75,000 or less in either 2019 or 2020, then you qualify to receive the full stimulus payment amounts. For married individuals who file a joint tax return, the adjusted gross income cap is $150,000. Because we're focused extensively on reaching individuals with little-to-no income, the reduced payment amounts for individuals who made above the $75,000 threshold is outside the scope of this article. But for more information on the reduced payment amounts, see the IRS's Questions and Answers about Economic Impact Payment Eligibility.
Claiming the stimulus payments
Presently, an individual must file a 2020 tax return to claim the stimulus funds. Why? Well first, the IRS needs to determine where the stimulus checks should be sent to, which it can obtain by retrieving the contact information listed on individual tax returns. However, the many of the 9 million eligible individuals do not ordinarily file a tax return (and are not required to file a return) because they either have no income or extremely low income. Since many of these individuals have not filed a tax return for years, the IRS does not have the appropriate contact information (e.g., current addresses or bank accounts), and therefore, the IRS is unable to determine where the stimulus funds should be sent to.
Another reason individuals must now file a 2020 tax return is because the first and second rounds of stimulus payments were actually advance payments of a 2020 tax credit called the Recovery Rebate Credit. So, if you’re missing one or more payments, or received an inaccurate payment amount, you have the ability to claim the missing funds as a tax credit on your 2020 tax return. This means the amounts will be added to any refund you’re owed.
Use the IRS Free File program to file your 2020 tax return
At MyTaxRights.org and the Center for Advancement of Tax Equity, we recommend filing through the IRS Free File program, a free online tax preparation service for individuals who meet certain income requirements—e.g., those with adjusted gross incomes of $72,000 or less in 2020. Eligible individuals do not need any specialized tax knowledge or experience to prepare their own taxes using the Free File program. The online software guides users step-by-step through the tax preparation process using simple question-based prompts. And for individuals who do not normally file a tax return, the process usually takes less than an hour (and much less if someone does not have any income to report). Also, using the Free File program may result in a much more accurate tax return versus paying someone else to prepare and file the return.
We’ve made it very easy and simple for people to find the correct landing page for the IRS Free File program—there's a lot of misleading advertisements and fake pathways out there. Follow these steps:
Navigate to www.MyTaxRights.org and click on the File Taxes for Free Here button in the center of the page.
Select the Link to IRS Free File Lookup Tool button.
You’ll be redirected to the IRS’s website where you’ll be asked a series of questions to determine what free tax preparation offers you qualify for. You can complete the questions in about 5 minutes.
Once you’re finished with Step 3, select one of the free tax preparation companies that appear on the screen and then work through the software’s questions until you’ve successfully completed and filed your return.
Once the IRS accepts your return, it will generally issue your refund within 21 days, which will include any stimulus payments you’re owed.
And that’s it! So please help us get the word out to there to our brothers and sisters in the homeless community, it’s a true injustice for anyone to miss out on the $3,200 their entitled to receive. Let’s get to work.
About the Author
Attorney Jordan D. Howlette is the President of MyTaxRights, LLC and the managing-member of JD Howlette Law, LLC, a civil litigation firm that represents individuals and businesses involved in tax disputes with the IRS, the United States Department of Justice (DOJ), and various state departments of revenue. A former trial attorney with the DOJ’s Tax Division, Jordan leverages his extensive background in tax litigation to educate others about their federal tax rights and responsibilities. Each tax season, Jordan also volunteers as a tax coach with the Center for the Advancement of Tax Equity, where he teaches others how to self-prepare and file their taxes through the non-profit's free tax clinics.