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WORKER’S GUIDE TO THE CARES ACT

WORKER’S GUIDE TO THE CARES ACT

Have questions about Congress’ $2 trillion relief bill? We’ve done our best to answer some of the biggest ones below:

What’s the deal with this $1,200 relief check?

The check is a refundable tax credit for the 2020 tax year, which the federal government will be providing in advance of filing. Importantly, this relief check is not considered taxable income! It will not be taxed, and receiving it will not put you at risk of losing federal benefits like SNAP or WIC.

Who qualifies for the check?

If you have a social security number:

  • U.S. citizen, OR
  • lawful permanent resident

AND cannot be claimed as a dependent, you are eligible, with certain exceptions1 2 3:

  • You must have a social security number in order to receive the check. Filing for taxes with an individual taxpayer identification number (ITIN) alone does not meet eligibility standards. For example, if you are not a legal resident, but have been physically present in the U.S. long enough to be eligible to pay taxes with your ITIN, you will not get a check.
  • Married, joint filers: if you are filing jointly with your spouse, but one of you does not have a social security number, you are ineligible and you will not receive a check, unless one of you is a member of the military.

So I qualify, but how much will I be getting?

The table below breaks things down:

If you file your taxes as…

And your adjusted gross income (AGI) was

You will receive

For each child that qualifies for the child tax credit (your dependents), you will receive4:

Single

$75,000 or less

$1,200

$500

Head of household (single parent)

$112,500 or less

$1,200

$500

Married (jointly)

$150,000 or less

$1,200

$500

If you are single (tax filing status) and make $75,000 or less, you will receive a one-time check of $1,200.

If you are married (tax filing status) and you and your partner jointly make $150,000 or less, you will receive a one-time check of $2,400.

If you file taxes as “head of household” (e.g. single parent) and make $112,500 or less, you will receive a one-time check of $1,200.

As the graph below illustrates, you are still eligible for some amount less than $1,200 if you are:

  • Single and AGI is < $100,000
  • Head of household and AGI is < $150,000
  • Married (joint filing) and AGI is < $225,000

Who doesn’t qualify?

If you do not have a social security number, you do not qualify. Or, if you filed jointly with your spouse, and

  1. Only one of you has a social security number, AND
  2. You are not a member of the military

I haven’t filed taxes recently. Do I still qualify for benefits?

If you have not filed taxes for either 2018 or 2019, you must file immediately, or you will not receive this check5. If you are usually not obligated to file taxes because your gross income is less than the standard deduction amount, you still must file to receive this check6.

Because the relief check is a refundable tax credit for the 2020 tax year, the IRS determines if you qualify based on your recent taxes (2018 or 2019).

If you have not yet filed for 2019, your 2018 adjusted gross income will be used to estimate whether or not you are eligible. Not sure what happens if you jumped above $150,000/year since filing 2018.

How will I get this money?

The money will be deposited electronically, if you have paid taxes or received former tax refunds using your current bank account info on or after Jan. 1 2018., THE IRS WILL NOT CALL YOU OR ASK FOR YOUR INFORMATION TO MAKE THIS DEPOSIT7 8 9.

If the above does not apply, or if you have received a check with your refund, or paid the IRS through the mail last year, you will receive a check in the mail. Note that the IRS has not made it clear as far as how they will provide your refund; check this website regularly for updates.

You can check which address the IRS has on file for you or change it by going here.

When should I expect my check?

Unfortunately, there isn’t a clear answer yet.

  • What the government is saying: The Treasury secretary has indicated that people will see this money deposited within three weeks10, as of 03/28/2020. Shortly thereafter, you will receive a letter detailing where the deposit was made and for how much or where the check was sent.
  • What the media is saying: This could take months. “It really depends on what information the IRS has on you,” Kyle Pomerleau, a resident fellow at the right-leaning American Enterprise Institute, told NPR11.

If you do not receive a direct deposit or a check at your current address, the IRS is required by the bill to send a notice that provides them with information on the amount of the payment, how it will be delivered (direct deposit / paper check), and a phone number at the Internal Revenue Service (IRS) to call if the payment is not received12. You can check which address the IRS has on file for you or change it by going here.

You should also be aware of the following:

  • If you are currently receiving federal assistance (SNAP, WIC), this relief check will not count as income, and so will not put you at risk of losing those benefits or assistance.
  • This relief check is not considered taxable income.
  • This relief check cannot be reduced by debt owed to any federal agency (excluding child support), past-due state income taxes, federal taxes, or unemployment compensation debts.

Information on expanded unemployment

How does this differ from normal unemployment?

This is a temporary boost to regular unemployment! It expands the period that you are allowed to receive unemployment benefits to a maximum of 39 weeks13 (adding 13 weeks to Louisiana’s original 26), who can receive unemployment benefits14, and it adds an extra $600 onto the benefits you would normally receive.

This is a temporary federal unemployment insurance program for individuals not otherwise eligible for unemployment insurance benefits (e.g., self-employed, independent contractors, gig economy workers): Pandemic Unemployment Assistance (PUA)15.

Who qualifies?

You are eligible to apply for regular unemployment and receive the additional $600, if you:

  • Are self-employed, a gig worker, freelance worker, or independent contractor who lost their job,
  • had to leave a job because you had to self-quarantine,
  • had to leave a job because your kids can’t go to school,
  • were about to start a new job and now cannot,
  • just started a new job and don’t meet the previous requirements for work history,
  • relied on the income of someone who is now sick or has passed away due to the virus, or
  • have already exhausted your unemployment benefits (you can reapply to receive the additional 13 weeks/$600 to your benefits, but it is unclear if you will receive more in future legislation).

You are probably eligible if you are:

  • Partially unemployed,
  • still employed but not working any hours (furloughed), or
  • working part-time.

If none of the above conditions apply to you, check out the website for more information if you are:

  • Employed but cannot work remotely and do not have leave,
  • partially unemployed, meaning you are still employed but with reduced hours, and you are making less than what you would be paid by unemployment benefits, or
  • you were a part-time employee that lost their job (you should at least be entitled to the $600 and you should qualify for standard unemployment benefits in Louisiana).

If you are currently on unemployment, this will extend the remaining period by 13 weeks and add the $600 to your benefits.

Who doesn’t qualify?

If you:

  • Were in the job market, but did not have an offer lined up,
  • quit your job because you did not feel safe going to work in the midst of a pandemic, or
  • are able to work from home, receive paid sick/family leave, you may not be eligible for increased benefits.

When do these expanded benefits go into effect?

You should apply for Louisiana unemployment as soon as possible. These benefits should go into effect immediately. If you already receive Louisiana unemployment benefits, you should reapply to receive the additional 13 weeks and $600/week of benefits.

If I apply today, how long will it take to get my money?

There is no waiting period to apply, but there is a wait due to the unprecedented number of claims right now. Apply as soon as you can and during off-peak hours if possible. You should receive more information about when you will receive your first check once your claim goes through.

  • Apply by phone by calling (866) 783-5567
  • Apply online here

The normal “week of waiting” period is waived for cases pertaining to COVID-1916.

If I left my last job voluntarily (quit), will I still qualify for expanded unemployment benefits?

Potentially, if either of the following apply:

  • You have been diagnosed with COVID-19 or experiencing symptoms and seeking a medical diagnosis, or
  • a member of your household has been diagnosed with COVID-1917.

If you left your last job voluntarily, you most likely will not be eligible for unemployment benefits.

What if I left my job to quarantine a few weeks ago?

This bill covers all those who lost their jobs since Jan 27th 2020, provided that they meet the other requirements outlined above.

I am a tipped worker, and don’t report my cash tips to the IRS. Will this affect my benefits?

This will affect how much you receive. Here’s how:

  1. It will limit the amount you are able to receive in unemployment from The State of Louisiana based on our guidelines18.
  2. The maximum amount you can receive weekly is based on a yearly salary of about $20,400. If you reported less than this because you do not report cash (or credit) tips, you may miss out on some money that you would otherwise have gotten from your unemployment claim.
  3. However, that does not affect the $600/week that you will receive from this bill on top of the other benefits that you will qualify for.

What if I am still employed, but scared that I may be fired soon? Should I quit?

If you are currently employed and feel safe at your job (you are working from home, your work is solitary, your employer is taking strict precautions) there is no reason to quit right now. These unemployment benefits will last until December 2020 – perhaps even longer. If you are fired or need to quarantine, etc any time between now and then, you will be eligible for the benefits outlined above.

References

WORKER’S GUIDE TO THE CARES ACT
Last updated August 28th, 2022 at 3:59 PM
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