2020 Economic (Impact) Stimulus Payment of $1,200

[Raj1]

Though not directly related to Pro Series, does a person qualify for the 2020 Economic (Impact) Stimulus Payment of $1,200 in the following 3 independent situations

(1) Filed in 2018 1040-NR (less than $75,000 income)

(2) Need to file 1040-NR in 2019 (less than $75,000 income)

(3) In 2018 filed MFJ with more than $200,000 income and hence not eligible for $1,200 stimulus for either spouse BUT in 2019 filing MFS with less than $40,000 income at least for one spouse.  (This MFS in 2019 is a long planned decision made in 2018 itself).  The other Spouse with more than $100,000 income in 2019 does not qualify for this stimulus regardless.

[itonewbie · Accepted solution]

1) No

2) No

3) Good luck if the rebate from MFS outweighs any tax saving from MFJ.

What you seem to have missed is that NRAs and resident aliens not authorized to work (even with SSN) are not eligible for the recovery rebate and economic impact payment.  Probably time to do some homework.

[Just-Lisa-Now-]

Well, they need to be a US Resident, so I think your 1040NR situations may be out of luck.

Your MFS person under 75K should get included if they file a 2019 return, unless theyre in a community property state, then they may be out of luck then as well, since all income may need to be split 50/50

[itonewbie]

In addition to being US residents, they also need to have an SSN that is authorized for employment.  Resident aliens who have ITINs or SSN but not authorized to work are not eligible.  Neither are US citizens and green card holders who could be claimed as dependents of another taxpayer.

[BobKamman]

Where are you finding "authorized to work" condition for SSN?

Especially for the 2-year-old child of recent immigrants.  

[itonewbie]

6428(g) Identification Number Requirement.—
6428(g)(1) In general.—No credit shall be allowed under subsection (a) to an eligible individual who does not include on the return of tax for the taxable year—

6428(g)(1)(A) such individual's valid identification number,

6428(g)(1)(B) in the case of a joint return, the valid identification number of such individual's spouse, and

6428(g)(1)(C) in the case of any qualifying child taken into account under subsection (a)(2), the valid identification number of such qualifying child.

6428(g)(2) Valid identification number.— 

6428(g)(2)(A) In general.—

For purposes of paragraph (1), the term "valid identification number" means a social security number (as such term is defined in section 24(h)(7)).

[BobKamman]

I wonder how they (or we) track that for older resident aliens.  It wasn't until 1982 that Social Security started to note "Not Valid For Employment" on Social Security cards.  

[itonewbie]

I see that as part of the due d.  We're used to dealing with this since we specialize in expats and foreign nationals.  For folks who work mainly with domestic clients, it could be more difficult to discern.

[Raj1]

My Question/s about Covid 19 (2020) Stimulus Eligibility

Thanks and Update

April 7, 2020

Thanks for your time and help.

Based on answers from various friendly and helpful community contributors, I conclude that 1040-NR filers for both 2018 and/or 2019 tax years are not eligible.

But a new point has been brought up by some about SSN / ITIN / Authorized to Work etc. and now not clear whether Spouse and child / children with only ITIN of the Tax payer with SSN are eligible for the stimulus or not.

Regarding my MFS question, it is not so much about tax efficiency of the MFS v/s MFJ, but the facts are MFJ of 2018 had income far greater than $200,000 so either spouse not eligible for stimulus.  But one of the MFJ of above 2018 ineligible spouse decidedly filing MFS in 2019 with income below $50,000 qualify for stimulus based on 2019 though not qualified due to 2018 MFJ?  

Any thoughts / clarifications / updates would be highly appreciated.

Thanks and Regards.

Raj1

[itonewbie]

Necessity for SSN authorized for employment and ITIN holders not being eligible is a matter of law.  See citations given above.

MFJ vs MFS has to make sense when the recovery rebate and difference in tax between these filing statuses are viewed in totality.  Some simple scenario calculations should give you the answer.

[itonewbie]

A quick and dirty back of the envelop calculation will show that filing MFS with no qualifying children and a combined income of $200k (based on $160k + $40k) for the sake of recovery rebate wouldn't be beneficial.

[Raj1]

Thanks and accepted your solution.

[itonewbie]

YAVW!