American Rescue Plan FAQs: Stimulus Payments and Tax Updates

Since the American Rescue Plan was signed into law in March 2021, the IRS has been working to implement provisions of the law and provide guidance to make sure taxpayers can receive Economic Impact Payments (EIP or stimulus checks) and take advantage of new tax credits during this current tax season. 

Below are frequently asked questions about the American Rescue Plan will impact this tax season and when people can expect to receive their stimulus checks: 

Stimulus Payments 

How much is the third Economic Impact Payment (EIP3) and am I eligible? 

In this version, the maximum payment is $1,400 per qualified individual or $2,800 for a couple.  

In addition, $1,400 payments are now available for all dependents, including children in college and elderly relatives.  

As with previous rounds of payments, economic stimulus payments are phased out, based on adjusted gross income. However, the upper threshold is reduced from $100,000 of adjusted gross income to $80,000 for single filers and from $200,000 down to $160,000 for joint filers. Payments for dependents are also phased out under these thresholds. 

Mixed-Status Families: 

Children of mixed-immigration status families with valid social security numbers are also eligible for the stimulus payments. 

For married couples who file jointly and only one individual has a valid social security number (SSN), the spouse with a valid SSN will receive up to a $1,400 payment for themselves and up to $1,400 for each qualifying dependent claimed on their 2020 or 2019 tax return.  

For taxpayers who do not have a valid SSN, but have a qualifying dependent who has an SSN, they will receive up to $1,400 per qualifying dependent claimed on their return if they meet all other eligibility and income requirements.  

Do I qualify for the March 2021 Stimulus Check (N.C. Justice Center, English and Español)

Military Families: 

If either spouse was an active member of the U.S. Armed Forces at any time during the taxable year, only one spouse needs to have a valid SSN for the couple to receive up to $2,800 for themselves, plus up to $1,400 for each qualifying dependent. 

When can I expect to receive my Economic Impact Payment (EIP3)? 

Most eligible U.S. residents received EIP3 in mid-March through direct deposit or will soon receive it by paper check or pre-paid debit card in the coming weeks.

Social Security and other federal beneficiary recipients who did not receive EIP3 through direct deposit can expect the payment in early April the same way as their regular benefits, though some may receive it as a paper check or pre-paid debit card.  

The IRS continues to review data received for Veterans Affairs (VA) benefit recipients and expects to determine a payment date and provide more details soon. 

Check your mail

The IRS urges all expecting an economic impact payment through paper check or pre-paid debit card to check their mail frequently and look out for the payment.  

The IRS hopes to have all payments issued by the end of May, but you can check the status of your economic impact payment with the Get My Payment tool

How is my eligibility for the Economic Impact Payment (EIP3) determined? 

The amount of the third payment is based on the taxpayer’s latest processed tax return from either 2020 or 2019, information from Social Security or other federal beneficiary organization, or information entered previously through the IRS’s Non-tax Filer Tool.  

If the taxpayer’s 2020 return has not been processed, the IRS used 2019 tax return information to calculate the third payment. If the third payment is based on the 2019 return, and is less than the full amount a taxpayer is eligible for, the taxpayer may qualify for a supplemental payment.  

After their 2020 return is processed, the IRS will automatically re-evaluate their eligibility using their 2020 information. If they are entitled to a larger payment, the IRS will issue a supplemental payment for the additional amount. 

Do I need to take any actions to receive my Economic Impact Payment (EIP3)? 

No action is required for most who are eligible for EIP3. 

However, some may need to file a simple 2020 tax return to claim the Recover Rebate Credit to receive some or all of any of the three economic impact payments issued from the federal government.  

Who may need claim the Recovery Rebate Credit? 

The following groups may be among those who should claim the Recovery Rebate Credit and file a 2020 tax return to receive EIP3: 

  • Recent college graduates,  
  • Those who were claimed as dependents in 2019,  
  • Incarcerated or recently incarcerated people,  
  • Mixed-immigration-status families, and  
  • Social Security recipients who did not receive a stimulus payment for their dependents.  

Learn about the Recovery Rebate Credit here.  

What does the third Economic Impact Payment look like (EIP3)? 

For those receiving payments in the mail, the IRS urges these taxpayers to continue to watch their mail for these payments, which could include a paper Treasury check, or a special prepaid debit card called an EIP Card. 

Paper checks will arrive by mail in a white envelope from the U.S. Department of the Treasury.  

The EIP Card will also come in a white envelope prominently displaying the seal of the U.S. Department of the Treasury. The card has the Visa name on the front and the issuing bank, MetaBank, N.A. on the back. Information included with the card will explain that this is an Economic Impact Payment. Each mailing will include instructions on how to securely activate and use the card. 

EIP cards issued for any of the three rounds of payments are not reloadable. Recipients will receive a separate card and will not be able to reload funds onto an existing card. 

The form of payment for EIP3, including for some Social Security and other federal beneficiaries, may be different than earlier stimulus payments. More people are receiving direct deposits, while those receiving payments in the mail may receive either a paper check or an EIP Card. 

 
Tax Refunds and Updates 

When is the tax filing deadline? 

The federal deadline for filing taxes has been extended to May 17. 

In North Carolina, the deadline for filing state taxes is May 17. 

What new tax credits and rebates are available through the American Rescue Plan? 

Earned Income Tax Credit:  

The American Rescue Plan expands the Earned Income Tax Credit for 2021, raising the maximum credit for childless adults from roughly $530 to close to $1,500, while also increasing the income limit for the credit from about $16,000 to about $21,000, and expanding the eligible age range by eliminating the age cap for older workers. 

Child Tax Credit:  

The American Rescue Plan includes changes to the Child Tax Credit (CTC) for the 2021 tax year: 

  • An increase to $3,600 per qualified child under age 6 and $3,000 for a child up to age 17. 
  • An additional $500 credit is available for dependent children in college who are under age 24. 
  • The phaseout begins at lower levels of $75,000 of adjusted gross income for single filers and $150,000 for joint filers. But many higher-income families can still claim the $2,000 credit subject to the prior phaseout rules. 

The IRS will make advance payments of the credit, beginning in July. The exact logistics of that process are still being worked out. 

Read more about changes to the Child Tax Credit here.

Dependent Care Credit

The new law increases the Dependent Care Credit for the 2021 tax year to a maximum of $4,000 for one child and $8,000 for two or more children for households with an adjusted gross income of up to $125,000. But the credit will be reduced below 20% for those with an adjusted gross income of more than $400,000.  

Read more about the Dependent Care Credit here

Student Loan Forgiveness Credit

The American Rescue Plan creates a tax exemption beginning in the 2021 tax year for student loans made, insured or guaranteed by the federal or state governments, as well as loans from private lenders and educational institutions. This does not apply, however, to loans that are discharged in exchange for services rendered.

Read more about the Student Loan Forgiveness Credit here

Do I need to pay taxes on unemployment benefits I received in 2020?   

The American Rescue Plan exempts from federal income tax up to $10,200 of unemployment benefits received in 2020 by a family with an adjusted gross income under $150,000.  

Normally, those benefits would be fully taxable. This tax break is intended to help taxpayers who might be blindsided by an unexpected tax bill on their 2020 returns.  

Please note that unemployment benefits are still taxable at the state level and need to be reported as income on North Carolina taxes. 

I am eligible for the expanded Earned Income Tax Credit made available by the American Rescue Plan and/or received unemployment benefits in 2020, but I already filed my tax return. What should I do to receive my full refund? 

If you claimed the expanded credit on your tax return and/or included your unemployment benefits on your tax return, the IRS will automatically review your tax return again and issue the correct refund beginning in May and continue through the summer. You do not need to file an amended return. 

The IRS will do these recalculations in two phases, starting with taxpayers eligible for the up to $10,200 exclusion. The IRS will then adjust returns for those married filing jointly taxpayers who are eligible for the up to $20,400 exclusion and others with more complex returns. 

What if I already filed my tax return and did not claim a credit because I was previously ineligible for it? 

There is no need for taxpayers to file an amended return unless the calculations make the taxpayer newly eligible for additional federal credits and deductions not already included on the original tax return. For example: 

  • The IRS can adjust returns for those taxpayers who claimed the Earned Income Tax Credit (EITC) and, because the exclusion changed the income level, may now be eligible for an increase in the EITC amount which may result in a larger refund.  
  • However, taxpayers would have to file an amended return if they did not originally claim the EITC or other credits but now are eligible because the exclusion changed their income. 
  • These taxpayers may want to review their state tax returns as well. 

The IRS has worked with the tax return preparation software industry to reflect these updates so people who choose to file electronically simply need to respond to the related questions when electronically preparing their tax returns. See New Exclusion of up to $10,200 of Unemployment Compensation for information and examples.   

I am eligible for new or expanded rebates/credits made available by the ARP but have not filed my 2020 tax return. What should I do to receive my full refund? 

Complete your 2020 tax return as you normally would. The IRS has supplied a new worksheet to reflect the changes and online tax preparer software agencies have been instructed to adapt their programs to reflect the changes.  

I have health insurance through the Health Insurance Marketplace (ACA/Obamacare). What should I do about reconciling my financial assistance for coverage premiums this tax season?

The American Rescue Plan Act suspends the requirement that taxpayers pay back all or a portion of their excess advance payments of the Premium Tax Credit for tax year 2020.

What is a Premium Tax Credit

From healthcare.gov: A Premium Tax Credit is a tax credit you can take in advance to lower your monthly health insurance payment (or “premium”).

When you apply for coverage in the Health Insurance Marketplace, you estimate your expected income for the year. If you qualify for a premium tax credit based on your estimate, you can use any amount of the credit in advance to lower your monthly premium (APTC).

In a typical tax year, taxpayers use Form 8962, Premium Tax Credit to figure the amount of their PTC (based on actual annual income) and reconcile it with their APTC (based on the annual income estimated).

If at the end of the year you’ve taken more premium tax credit in advance than you’re due based on your final income, you’ll have to pay back the excess when you file your federal tax return.

If you’ve taken less than you qualify for, you’ll get the difference back through claiming a net Premium Tax Credit.

The Internal Revenue Service has announced that taxpayers with excess Advance Premium Tax Credits (financial assistance) for 2020 are not required to file Form 8962, Premium Tax Credit, or report an excess advance Premium Tax Credit repayment on their 2020 Form 1040 or Form 1040-SR, Schedule 2, Line 2, when they file.

Taxpayers can check with their tax professional or use tax software to figure the amount of allowable PTC and reconcile it with APTC received using the information from Form 1095-A, Health Insurance Marketplace Statement.

For taxpayers claiming a net PTC for 2020: 
The process remains unchanged. They must file Form 8962 when they file their 2020 tax return. See the Instructions for Form 8962 for more information. Taxpayers claiming a net PTC should respond to an IRS notice asking for more information to finish processing their tax return.

For taxpayers who have already filed:
Taxpayers who have already filed their 2020 tax return and who have excess APTC for 2020 do not need to file an amended tax return or contact the IRS. The IRS will reduce the excess APTC repayment amount to zero with no further action needed by the taxpayer.

The IRS will reimburse people who have already repaid any excess advance Premium Tax Credit on their 2020 tax return. Taxpayers who received a letter about a missing Form 8962 should disregard the letter if they have excess APTC for 2020. The IRS will process tax returns without Form 8962 for tax year 2020 by reducing the excess advance premium tax credit repayment amount to zero.

Again, IRS is taking steps to reimburse people who filed Form 8962, reported, and paid an excess advance Premium Tax Credit repayment amount with their 2020 tax return before the recent legislative changes were made. Taxpayers in this situation should not file an amended return solely to get a refund of this amount. The IRS will provide more details on IRS.gov. There is no need to file an amended tax return or contact the IRS. 

For taxpayers reconciling benefits received prior to the 2020 tax year:
As a reminder, this change applies only to reconciling tax year 2020 APTC. Taxpayers who received the benefit of APTC prior to 2020 still must file Form 8962 to reconcile their APTC and PTC for the pre-2020 year when they file their federal income tax return even if they otherwise are not required to file a tax return for that year. 

The IRS continues to process prior year tax returns and reach out to taxpayers for missing information. If the IRS sends a letter about a 2019 Form 8962, the IRS need more information from the taxpayer to finish processing their tax return. Taxpayers should respond to the letter so that the IRS can finish processing the tax return and, if applicable, issue any refund the taxpayer may be due.

See the  Form 8962, Premium Tax Credit, and IRS Fact Sheet for more details about the changes related to the PTC for tax year 2020.

Healthcare.gov Premium Tax Credits and Filing Your 2020 Taxes

Learn more about how the American Rescue Plan impacts the Affordable Care Act and your ability to get health coverage here.

How can I check my status of my tax return? 

Track the status of your tax refund with the Where’s My Refund? tool at IRS.gov or through the IRS2Go App

While most tax refunds are issued within 21 days, some may take longer if the return requires additional review. 

Taxpayers can start checking on the status of their return within 24 hours after the IRS acknowledges receipt of an electronically filed return or four weeks after the taxpayer mails a paper return. The tool’s tracker displays progress in three phases: 

  1. Return received 
  1. Refund approved 
  1. Refund sent 

To use Where’s My Refund, taxpayers must enter their Social Security number or Individual Taxpayer Identification Number (ITIN), their filing status and the exact whole dollar amount of their refund. The IRS updates the tool once a day, usually overnight, so there’s no need to check more often. 

Additional Resources 

Learn more about the American Rescue Plan 
IRS Interactive Tax Assistant (ITA) 
File Your Federal Taxes for Free 
Ready to File Your 2020 Tax Return? 
VITA Offers Free Help Filing 2020 Taxes 
 

VITA Offers Free Help Filing 2020 Taxes

The IRS Volunteer Income Tax Assistance (VITA) program is available by virtual appointment through tax season to help eligible residents file their taxes.   

If your household income in 2020 was $57,000 or less, you could qualify to have your taxes prepared and submitted through this program.  

Due to COVID-19 restrictions, this year’s VITA services will be offered virtually and securely by IRS certified tax preparers, using Adobe Scan, Google Duo, Verifyle, and Zoom to complete returns.  Learn more and register for your free appointment.

An in-person VITA site is open at the Dellwood Center in Huntersville by appointment only until April 10. Learn more and make an appointment

VITA ofrece servicios gratuitos de preparación de impuestos locales 

El programa de Asistencia Voluntaria de Impuestos sobre la Renta (VITA por sus siglas en inglés) del IRS está disponible mediante cita virtual durante la temporada de impuestos para ayudar a los residentes elegibles a presentar sus impuestos. 

Si el ingreso de su hogar en 2020 fue de $ 57,000 o menos, podría calificar para que se preparen y presenten sus impuestos a través de este programa. 

Debido a las restricciones de COVID-19, los preparadores de impuestos certificados por el IRS ofrecerán los servicios VITA de este año de manera virtual y segura, utilizando Adobe Scan, Google Duo, Verifyle y Zoom para completar las declaraciones. Obtenga más información y regístrese para su cita gratuita.

Un sitio de VITA en persona está abierto en el Dellwood Center en Huntersville solo con cita previa hasta el 10 de abril. Obtenga más información y regístrese para su cita.

Information about the CARES Act Economic Impact Payments (Stimulus Checks)

Updated March 11, 2021. Originally posted April 6, 2020

IMPORTANT Notice: 

On March 11th, 2021 President Biden signed a the American Rescue Plan that included additional $1400 stimulus checks per eligible individual.

Learn more about the third payments and the American Rescue Plan here.

If you have questions about your stimulus payments, contact Charlotte Center for Legal Advocacy by calling 980-202-7329.

Many people anticipate receiving the CARES Act’s Economic Impact Payments (Stimulus Checks). Charlotte Center for Legal Advocacy wants to make sure you have the information you need to know what to expect and how to get your payment.

Need help?
Book An Initial Consultation
Request a Callback
Call Us at 980-202-7329

Anyone in need of other assistance from Charlotte Center for Legal Advocacy can contact us by calling 704-376-1600 (Mecklenburg County), 800-438-1254 (Outside Mecklenburg County) or 800-247-1931 (Linea de Español).

Who is eligible for the payment?

Tax filers with adjusted gross income up to $75,000 for individuals and up to $150,000 for married couples filing joint returns will receive the full payment.

For filers with income above those amounts, the payment amount is reduced by $5 for each $100 above the $75,000/$150,000 thresholds. Single filers with income exceeding $80,000 and $160,000 for joint filers with no children are not eligible. 

Eligible taxpayers who filed tax returns for either 2020 or 2019 will automatically receive an economic impact payment of up to $1,400 for individuals or $2,800 for married couples. Households also receive $1400 for each qualifying dependent. 

Will the IRS take my payment if I have outstanding IRS debts, federal student loans or other government debts?

No. As with second-round checks, third stimulus checks will not be reduced to pay child support arrears either. 

How will the IRS calculate my payment?

The American Rescue Plan provides that if your 2020 tax return is not filed and processed by the time the IRS starts processing your third stimulus payment, the tax agency will use information from your 2019 tax return. If your 2020 return is already filed and processed when the IRS is ready to send your payment, then your stimulus check eligibility and amount will be based on information from your 2020 return.  

If your 2020 return is filed and/or processed after the IRS sends you a stimulus check, but before July 15, 2021 (or September 1 if the April 15 filing deadline is pushed back), the IRS will send you a second payment for the difference between what your payment should have been if based on your 2020 return and the payment sent based on your 2019 return. 

Most people do not need to take any action. The IRS will calculate and automatically send the payment to those eligible. 

How will the IRS know where to send my payment?

The economic impact payment will be deposited directly into the same banking account reflected on your tax return filed. 

The IRS does not have my direct deposit information. What can I do?

The IRS has an online portal, Get My Payment, for individuals to:

  • Check their payment status
  • Confirm their payment type: direct deposit or check
  • Enter their bank account information for direct deposit if the IRS doesn’t have their direct deposit information and the IRS hasn’t sent their payment yet

How to use Get My Payment

Taxpayers only need a few pieces of information to quickly obtain the status of their payment and, where needed, provide their bank account information. Having a copy of their most recent tax return can help speed the process.

For taxpayers to track the status of their payment, this feature will show taxpayers the payment amount, scheduled delivery date by direct deposit or paper check and if a payment hasn’t been scheduled. They will need to enter basic information including:

  • Social Security number
  • Date of birth, and
  • Mailing address used on their tax return.

Taxpayers needing to add their bank account information to speed receipt of their payment will also need to provide the following additional information:

  • Their Adjusted Gross Income from their most recent tax return submitted, either 2020 or 2019
  • The refund or amount owed from their latest filed tax return
  • Bank account type, account and routing numbers

Get My Payment cannot update bank account information after an Economic Impact Payment has been scheduled for delivery. To help protect against potential fraud, the tool also does not allow people to change bank account information already on file with the IRS. 

Is providing bank account information to the IRS when paying your tax filing liability good enough?

No, people who paid electronically are going to have to input deposit account information. Go to Get My Payment.

When will payments begin?

Taxpayers with direct deposit information on file with the IRS should see their payment in their bank accounts beginning the week of March 15, 2021, while others might have to wait up to five months to receive paper checks or pre-payed debit cards. 

What about taxpayers who don’t have bank accounts?

The U.S. Treasury Department and the IRS are working with digital companies and prepaid debit card providers to ensure there are other avenues for those taxpayers get their money quickly. 

I receive SS/VA benefits and/or I am not typically required to file a tax return. Can I still receive my payment?

Yes. Individuals who receive Social Security benefits (Social Security retirement, disability income (SSDI), supplemental income (SSI) or Survivors Benefits) or Veterans Affairs benefits (disability compensation, pension or survivors benefits) who didn’t file tax returns in 2020 or 2019 won’t need to file tax returns to receive their payments. 

They should receive the additional money just as they would their Social Security or VA benefits. The IRS will use the information provided by the Social Security Administration/VA OR the information you provided with the IRS’ Non-Filers: Enter Your Payment Info to generate the $1,400 Economic Impact Payments. Recipients will get their payment as a direct deposit or by paper check, just as they normally would.

I am not typically required to file a tax return because I am low-income. Can I still receive my payment?

Yes. The IRS will use information you provided in the IRS’ Non-Filers: Enter Your Payment Info to send you your stimulus payment.

I have not filed my tax return for 2019 or 2020. Can I still receive a payment?

Yes. The IRS urges anyone with a tax filing obligation who has not yet filed a tax return for 2019 or 2020 to file as soon as they can to receive a payment. Taxpayers should include direct deposit banking information on the return. Visit IRS Free File

If I receive SSI or a VA pension will my payment be considered income?

Please note that the Social Security Administration and Department of Veterans Affairs will not consider the payments as income, and the payments are excluded from resources for 12 months.

What about taxpayers with Individual Tax Identification Numbers (ITINs)?

Immigrants with ITINs are not eligible for the $1,200 payments. 

What about mixed-status families (SSN valid for employment and ITIN on the same tax return)?

You are eligible for a second stimulus payment for yourself and any dependents you claimed who also have Social Security numbers valid for employment, but not for your spouse. (Mixed-status families who did not receive the first stimulus payment due to the previous restrictions on spouses of people filing with ITINs will now be eligible to get that payment retroactively when they file their 2020 tax return. Read more here.)

I need to file a tax return. How long are payments available?

For those concerned about visiting a tax professional or local community organization in person to get help with a tax return, these economic impact payments will be available throughout the rest of 2021.

Does someone who has died qualify for the payment?

No. A payment made to someone who died before receipt of the payment should be returned to the IRS by following the instructions for repayments. Return the entire payment unless the payment was made to joint filers and one spouse had not died before receipt of the payment, in which case, you only need to return the portion of the payment made on account of the decedent. This amount will be $1,400 unless adjusted gross income exceeded $150,000.

Does someone who is incarcerated qualify for the payment?

Yes. They can claim the payment by filing a simple 2020 tax return. Read more here.

What should I do to return a payment?

You should return the payment as described below.

If the payment was a paper check:

  • Write “Void” in the endorsement section on the back of the check.
  • Mail the voided Treasury check immediately to the appropriate IRS location listed below.
  • Don’t staple, bend, or paper clip the check.
  • Include a note stating the reason for returning the check.

If the payment was a paper check and you have cashed it, or if the payment was a direct deposit:

  • Submit a personal check, money order, etc., immediately to the appropriate IRS location listed below.
  • Write on the check/money order made payable to “U.S. Treasury” and write 2020EIP, and the taxpayer identification number (social security number,  or individual taxpayer identification number) of the recipient of the check.
  • Include a brief explanation of the reason for returning the payment

What if my spouse or ex-spouse took my payment in 2020?

If so, you may be able to claim your economic impact payment (EIP) as a credit or refund on your 2020 federal tax return.

In many abusive relationships the abuser controls the household’s money and finances. Although the survivor may have agreed to the filing of the tax return that the COVID relief payment was based upon, the abuser may have later refused to pay over the survivor’s share of the payment or the survivor cannot get the payment from the abuser without risking harm or abuse. In other situations, survivors may not have seen or signed the tax return that the COVID relief payment was based upon, or they were forced to sign the return under threats or duress.

IRS procedures outline a path for relief for survivors who believe their COVID relief payments were issued based on a tax return that was fraudulent, forged, or signed by the survivor under duress.

Unfortunately, the IRS has not created procedures for allowing a survivor to receive the Recovery Rebate Credit when both spouses agreed to file a married-filing-joint return, but the abusive spouse refused to pay over the survivor’s share of the COVID relief payment. Advocates for survivors of domestic violence have been working on this issue and continue to do so in an effort to find relief for survivors in this situation.

Follow these steps to receive your payment and get help

Where can I get more information?

The IRS will post all key information on IRS.gov/coronavirus as soon as it becomes available.

The IRS has a reduced staff in many of its offices but remains committed to helping eligible individuals receive their payments expeditiously. Check for updated information on IRS.gov/coronavirus rather than calling IRS assisters who are helping process 2020 returns.

Charlotte Center for Legal Advocacy launches new projects to support COVID-19 relief

The need is everywhere. That’s why we’re here.

Now more than ever, our community needs a champion to ensure equal access to justice for ALL during these challenging times. Charlotte Center for Legal Advocacy is here to help anyone facing issues of safety, financial security and family stability during the COVID-19 pandemic and beyond.

The Advocacy Center is still providing services in the areas of consumer protection, domestic violence, ex-offender re-entry, healthcare access, home preservation, immigration, income security and tax disputes, while working to ensure vulnerable populations, such as children, immigrants, people living with disabilities, seniors and veterans have the assistance they need during this critical time.

As needs continue to evolve, the Advocacy Center has been adapting its services to effectively serve the community, launching three new COVID-19 specific initiatives to help those in need:

Unemployment Insurance Assistance

Thousands of North Carolinians have lost their jobs due to COVID-19 and are seeking financial assistance through the state’s Unemployment Insurance Program.

The overwhelming volume of applications paired with implementing new assistance programs under the federal CARES Act has caused significant delays, making the process more confusing for applicants trying to apply.

The Unemployment Insurance Project helps people who have lost work due to COVID-19 understand their eligibility and navigate the application process to receive unemployment benefits.

While Advocacy Center staff cannot help applicants fill out the necessary paperwork, they can answer questions about the process.

How to apply for unemployment benefits:

Anyone needing assistance can call the Unemployment Insurance COVID-19 Response Project hotline, 980-256-3979 and leave a message to receive assistance in English or Spanish.

Learn more about the project.

Help Understanding the Economic Impact Payments (Stimulus Checks) from the CARES Act

Many people anticipate receiving the CARES Act’s Economic Impact Payments (Stimulus Checks) as additional financial support. Charlotte Center for Legal Advocacy wants to make sure they have the necessary information to know what to expect and how to get a payment.

Anyone with questions about how to get their payment or any other tax issues can contact our N.C. Low-Income Taxpayer Clinic by calling 980-202-7329 or filling out an online assistance request.

Check out our list of FAQs regarding the payments.

Watch our latest Facebook Live discussion on what people can expect as the government issues payments.

CARES Act Paycheck Protection Program Support for Local Non-Profits

Charlotte Center for Legal Advocacy recognizes the important role that our community nonprofits are playing in Coronavirus response while at the same time being heavily impacted by the pandemic. That’s why the Advocacy Center, along with its pro bono partners, is providing free assistance to help Charlotte-area 501(c)(3) organizations understand the process and apply to get federal aid.

The Paycheck Protection Program of the CARES Act made $350 billion available in small business loans. While most of this money has already been distributed, Congress will likely pass additional funding for small business loans as soon as this week.

Many 501(c)(3) organizations are eligible for these loans, and a significant portion of the loans to nonprofits can be forgiven if certain criteria are met. If you think your nonprofit organization may qualify for a loan and want help understanding the rules governing eligibility, repayment and forgiveness for the loan, we may be able to provide free legal advice for you.

Call Charlotte Center for Legal Advocacy at 980-256-3791 for assistance.

Información sobre Pagos de Impacto Económico de la Ley CARES

Read in English
Muchas personas anticipan recibir los Pagos de Impacto Económico de la Ley CARES (por sus siglas en ingles). El Centro de Apoyo Legal de Charlotte quiere asegurarse de que las personas tenga la información que necesita para saber qué esperar y cómo obtener su pago.

Cualquier persona con preguntas adicionales sobre cómo obtener su pago puede comunicarse con nuestra Clínica de Impuestos para contribuyentes de bajos ingresos de Carolina del Norte llamando al 980-202-7329 o completando una solicitud de asistencia en línea.

Cualquier persona que necesite otra ayuda del El Centro de Apoyo Legal de Charlotte puede contactarnos llamando al 704-376-1600 (Condado de Mecklenburg), 800-438-1254 (Fuera del Condado de Mecklenburg) o al 800-247-1931 (Línea de Español).

¿Quién es elegible para el pago?

Los contribuyentes con ingresos brutos ajustados de hasta $ 75,000 para individuos y hasta $ 150,000 para parejas casadas que presenten declaraciones conjuntas recibirán el pago completo.

Para los declarantes con ingresos superiores a esos montos, el monto del pago se reduce en $ 5 por cada $ 100 por encima de los umbrales de $ 75,000 / $ 150,000. Los declarantes solteros con ingresos superiores a $ 99,000 y $ 198,000 para declarantes conjuntos sin hijos no son elegibles.

Los contribuyentes elegibles que presentaron declaraciones de impuestos para 2019 o 2018 recibirán automáticamente un pago de impacto económico de hasta $ 1,200 para individuos o $ 2,400 para parejas casadas. Los padres también reciben $ 500 por cada niño calificado.

¿El IRS tomará mi pago si tengo deudas pendientes del IRS, préstamos estudiantiles federales u otras deudas del gobierno?

No, pero el IRS tomará su pago en la medida necesaria para pagar las obligaciones de manutención infantil pendientes.

¿Cómo calculará el IRS mi pago?

Para las personas que ya presentaron sus declaraciones de impuestos de 2019, el IRS utilizará esta información para calcular el monto del pago. Para aquellos que aún no han presentado su declaración de impuestos para 2019, el IRS utilizará la información de su declaración de impuestos de 2018 para calcular el pago.

La mayoría de las personas no necesitan tomar ninguna medida. El IRS calculará y enviará automáticamente el pago a los elegibles.

¿Cómo sabrá el IRS dónde enviar mi pago?

El pago de impacto económico se depositará directamente en la misma cuenta bancaria reflejada en su declaración de impuestos presentada.

El IRS no tiene mi información de depósito directo. ¿Que puedo hacer?

En las próximas semanas, el Departamento del Tesoro de los EE. UU. Planea desarrollar un portal en línea para que las personas proporcionen su información bancaria al IRS en línea para que las personas puedan recibir pagos de inmediato en lugar de cheques por correo.

Esos contribuyentes podrían obtener sus pagos más rápidamente al proporcionar su información de depósito directo al IRS en una nueva aplicación que está en proceso. Esta aplicación será como la popular aplicación de la temporada de presentación “¿Dónde está mi reembolso?” Le permitirá a los contribuyentes ver dónde están sus fondos bajo esta nueva ley. El nuevo portal estará disponible pronto.

¿Cuándo comenzarán los pagos?

Los contribuyentes con información de depósito directo en el archivo del IRS deben ver su pago en sus cuentas bancarias a partir de la semana del 13 de abril, mientras que otros tendrán que esperar hasta cinco meses para recibir cheques en papel.

Los primeros cheques deben ir a los 60 millones de contribuyentes con información de depósito directo de sus declaraciones de impuestos de 2018 o 2019 en el archivo del IRS. Después de eso, a partir de la primera semana de mayo, el IRS emitirá aproximadamente 5 millones de cheques en papel por semana a hasta 100 millones de personas que no tienen información de depósito directo en el archivo, en un proceso que podría tomar hasta 20 semanas para completar.

¿Qué pasa con los contribuyentes que no tienen cuentas bancarias?

El Departamento del Tesoro de los EE. UU. Y el IRS están trabajando con compañías digitales y proveedores de tarjetas de débito prepagas para garantizar que haya otras vías para que los contribuyentes obtengan su dinero rápidamente.

Normalmente no estoy obligado a presentar una declaración de impuestos. ¿Todavía puedo recibir mi pago?

Si. Las personas que reciben beneficios de jubilación, discapacidad o sobrevivientes del Seguro Social que no presentan declaraciones de impuestos no necesitarán presentar declaraciones para recibir sus cheques.

Deberían recibir el dinero adicional tal como lo harían con sus beneficios del Seguro Social. El IRS utilizará la información en el Formulario SSA-1099 y el Formulario RRB-1099 para generar $ 1,200 Pagos de Impacto Económico a los destinatarios del Seguro Social que no presentaron declaraciones de impuestos en 2018 o 2019. Los destinatarios recibirán estos pagos como depósito directo o en papel verificar, tal como normalmente recibirían sus beneficios.

SIN EMBARGO: Algunos contribuyentes de bajos ingresos, personas mayores y personas con discapacidades que reciben Ingresos de Seguridad Suplementarios (SSI) y veteranos que reciben compensación y / o pensiones por discapacidad del VA que de otra manera no están obligados a presentar una declaración de impuestos deberán presentar una declaración simple para obteer su pago. IRS.gov/coronavirus pronto proporcionará información para instruir a las personas de estos grupos sobre cómo presentar una declaración de impuestos de 2019 con información simple, pero necesaria, que incluye su estado civil, el número de dependientes y la información de la cuenta bancaria de depósito directo.

El 4 de abril, TurboTax presentó un portal en línea donde los estadounidenses de bajos ingresos que no presentan una declaración de impuestos pueden enviar su información al IRS para recibir su pago de estímulo lo antes posible. Los no declarantes pueden proporcionar sus datos de depósito directo o dirección de correo y elegir cómo desean recibir su cheque de estímulo.

No he presentado mi declaración de impuestos para 2018 o 2019. ¿Todavía puedo recibir un pago?

Si. El IRS insta a cualquier persona con una obligación de presentar una declaración de impuestos que aún no haya presentado una declaración de impuestos para 2018 o 2019 a presentarla tan pronto como les sea posible para recibir un pago. Los contribuyentes deben incluir información bancaria de depósito directo en la declaración.

Si recibo SSI, ¿mi pago se considerará ingreso?

Tenga en cuenta que la Administración del Seguro Social no considerará los pagos como ingresos para los beneficiarios de SSI, y los pagos están excluidos de los recursos durante 12 meses.

¿Qué pasa con los contribuyentes con números de identificación fiscal individual (ITIN)?

Los inmigrantes con ITIN no son elegibles para los pagos de $ 1,200.

¿Qué pasa con las familias de estatus mixto (SSN válido para empleo e ITIN en la misma declaración de impuestos)?

Si un esposo, esposa o cualquier dependiente reclamado tiene un ITIN en lugar de un Número de Seguro Social, ningún miembro de la familia recibirá el pago (Excepción para aquellos que prestan servicios en los Servicios Armados).

Por supuesto, la pareja podría dejar a sus dependientes con ITIN fuera de su declaración de impuestos. Y presentar una declaración por separado puede ser una opción, sin embargo, la pareja puede perder otros créditos reembolsables, como el Crédito Tributario Adicional por Hijo y los créditos educativos, si lo hacen.

Necesito presentar una declaración de impuestos. ¿Durante cuánto tiempo están disponibles los pagos?

Para aquellos preocupados por visitar en persona a un profesional de impuestos u organización comunitaria local para obtener ayuda con una declaración de impuestos, estos pagos de impacto económico estarán disponibles durante el resto de 2020.

¿Dónde puedo obtener más información?

El IRS publicará toda la información clave en IRS.gov/coronavirus tan pronto como esté disponible.

El IRS tiene un personal reducido en muchas de sus oficinas, pero sigue comprometido a ayudar a las personas elegibles a recibir sus pagos rápidamente. Busque información actualizada en IRS.gov/coronavirus en lugar de llamar a los asistentes del IRS que están ayudando a procesar las devoluciones de 2019.

COVID-19 Stimulus Payments: Protect Yourself from Scams

From Arthur Bartlett, director of the N.C. Low-Income Taxpayer Clinic:

WARNING: The Internal Revenue Service (IRS) is warning the public not to fall victim to a COVID-19 scam in which scammers are trying to intercept COVID-19 stimulus payments meant to provide financial support for Americans during the pandemic.

For most people, payments will be made as a direct deposit into their bank accounts, but some will receive a paper check.

Criminals and scammers may try and take advantage of you by having you:

  • Sign over part of or your entire Stimulus Check over to them.
  • “Verify” your filing information in order to receive your stimulus payment.
  • They may also try to obtain and use your personal information, including your Social Security Number, to file a false tax return to claim your stimulus payment.

Please know, the IRS will not call, text, or email you to “verify” your payment details. Do not give out your personal information, like a bank account, debit account or PayPal account information to anyone claiming to be from the IRS.

If you do receive a call, do not engage with the scammers or thieves, just hang up.

If you receive texts or emails claiming that you can get your money faster by sending personal information or clicking on links, delete them.

There are companies that are targeting unhoused individuals specifically. We have heard that houseless people have been approached by companies that say they will help someone register for their economic impact payment but take $399 or other amount from the payment. They have the person sign a contract (which you can read on this example company’s website – https://www.docuprepllc.com/) and tell them to come back on a certain date to get the remainder of their payment. You do not have to pay for their EIP and do not need to pay for help accessing it. The only site you should use to claim your stimulus payment is IRS.gov

In addition, if you receive a “check” for an odd amount or a check that requires you to verify the check online or by calling a number, it’s a fraud.

Retirees have been highlighted as a group particularly vulnerable to scams. From the IRS:

“The IRS also reminds retirees who don’t normally have a requirement to file a tax return that no action on their part is needed to receive their $1,200 economic impact payment. Seniors should be especially careful during this period. The IRS reminds retirees – including recipients of Forms SSA-1099 and RRB-1099 − that no one from the agency will be reaching out to them by phone, email, mail or in person asking for any kind of information to complete their economic impact payment, also sometimes referred to as rebates or stimulus payments. The IRS is sending these $1,200 payments automatically to retirees – no additional action or information is needed on their part to receive this.”

Read more about the warning issued by the IRS

Additionally, economic impact payments belong to the recipient, not nursing home or care facilities: “The payments are intended for the recipients, even if a nursing home or other facility or provider receives the person’s payment, either directly or indirectly by direct deposit or check. these payments do not count as a resource for purposes of determining eligibility for Medicaid and other federal programs for a period of 12 months from receipt. They also do not count as income in determining eligibility for these programs.”

We’re here to help: If you have any questions, please reach out to Charlotte Center for Legal Advocacy’s N.C. Low-Income Taxpayer Clinic by calling 704-376-1600 (Mecklenburg County), 800-438-1254 (Outside Mecklenburg County), 800-247-1931 (Linea de Español), or by submitting a contact form.

What NOT to do when filing your taxes

Filing taxes can be an overwhelming task, often because taxpayers are afraid of making mistakes. And there’s a good reason for some to feel that way: seemingly small mistakes made when filing your taxes can result in a major issue with the IRS down the road.

Learn what you need to do to file properly, protect yourself and ensure you have met all your obligations as a taxpayer.

What NOT to do when filing taxes:

  1. DO NOT forget to request and keep a copy of your filed tax return.
  2. DO NOT claim education credits on your tax return if you or one your dependents did not attend college.
  3. DO NOT file as “Married Filing Jointly,” if you and your partner are not married to each other.
  4. DO NOT file as “Head of Household,” if you are married and your spouse lived with you at the end of 2019, even if one spouse has a Social Security Number and the other has an ITIN.
  5. If you are self-employed, DO NOT forget to keep proof of your business income and business expenses, such as receipts.

Get free assistance preparing your taxes

Taxpayers who made less than $56,000 in 2019 can get FREE tax preparation services at Volunteer Income Tax Assistance (VITA) sites throughout tax season. Find one near you today!

Workers with ITINs: Have you renewed your number with the IRS?

What is an ITIN? ITINs, Individual Tax Identification Numbers is a processing number the IRS issues to people who do not have a social security number but are required to have an identification number for tax purposes. ITINs do not serve any purpose other than federal tax reporting.

The IRS sends notices to taxpayers with ITINs informing them of when to renew their ITIN. If you received a letter to renew your ITIN, but you did not, then it has expired and needs renewal.

If you have filed taxes with an expired ITIN, refunds from tax credits and dependent exemptions will be held until you renew your ITIN.

The ITIN renewal process is the same as the application for a new ITIN. You must complete IRS Form W-7 and check “Renew Existing ITIN” at the top of the form.  You are still required to submit identifying documents.

Some local IRS offices can verify identification documents you need to renew your ITIN.

The Taxpayer Assistance Center in Charlotte and in other North Carolina cities can verify documents, but you will need to make an appointment in advance. The schedule an appointment at the closest office near you that can verify your information contact 844-545-5640.

Charlotte Center for Legal Advocacy can assist taxpayers that need to renew their ITIN but does not verify or certify identification documents to submit with the W-7.

Learn more about ITIN Renewal.

Check out our other Tax Season Resources:

What to remember this Tax Season

Protect yourself from scams this Tax Season

What to remember this Tax Season

Tax season is upon us, and many people are looking for help filing a tax return.

In doing so, taxpayers should choose their tax preparers wisely because it’s ultimately the taxpayer who is responsible for all the information on their income tax return. This is true no matter who prepares the return.

Here are some tips for folks to remember when selecting a preparer:

Consider Going to a Volunteer Income Tax Assistance Site. Volunteer Income Tax Assistance (VITA) sites provide FREE income tax preparation to individuals and families who make less than $56,000 per year. These sites operate between February and mid-April at locations all over North Carolina.  Find a VITA site near you!

Check the Preparer’s Qualifications. People can use the IRS Directory of Federal Tax Return Preparers with Credentials and Select Qualifications. This tool helps taxpayers find a tax return preparer with specific qualifications. The directory is a searchable and sortable listing of preparers.

Check the Preparer’s History. Taxpayers can ask the local Better Business Bureau about the preparer. They should check for disciplinary actions and the license status for credentialed preparers.

Ask about Service Fees. People should avoid preparers who base fees on a percentage of the refund or who boast bigger refunds than their competition.

Ask to e-file. The quickest way for taxpayers to get their refund is to electronically file their federal tax return and choose direct deposit.

Make Sure the Preparer is Available. Taxpayers may want to contact their preparer after this year’s April 15 due date. People should avoid “fly-by-night” preparers.

Provide Records and Receipts. Good preparers will ask to see a taxpayer’s records and receipts. They’ll ask questions to figure things like the total income, tax deductions and credits.

Never Sign a Blank Return. Taxpayers should not use a tax preparer who asks them to sign a blank tax form.

Review Before Signing. Before signing a tax return, the taxpayer should review it. They should ask questions if something is not clear. Taxpayers should feel comfortable with the accuracy of their return before they sign it. Once they sign the return, taxpayers are accepting responsibility for the information on it.

Review details about any refund. Taxpayers should make sure that their refund goes directly to them – not to the preparer’s bank account. The taxpayer should review the routing and bank account number on the completed return.

Ensure the Preparer Signs and Includes their PTIN. All paid tax preparers must have a Preparer Tax Identification Number. By law, paid preparers must sign returns and include their PTIN.

Report Abusive Tax Preparers to the IRS. Most tax return preparers are honest and provide great service to their clients. However, some preparers are dishonest. People can report abusive tax preparers and suspected tax fraud to the IRS. Use Form 14157, Complaint: Tax Return Preparer (PDF).

Check out our other Tax Season Resources:

What NOT to do when filing your taxes

Protect yourself from scams this tax season

Protect Yourself This Tax Season

Tax season is also the season for scams targeting taxpayers. Understand the most common scams to protect yourself, your personal information and your finances.

Identity Theft

This occurs when someone uses your personal information such as your Name, Social Security Number (SSN) or other personal identifying information, without your permission. It is often used by scammers to fraudulently file tax returns and claim refunds.

If you file a tax return and then receive a letter from IRS that another tax return was filed using your name, OR if you don’t file a tax return and then receive a letter that a tax return was filed using your name, the false tax filing could be due to identity theft.

Your identity could be stolen, or misused by a former spouse, family member or business partner. 

If you believe that you are at risk of identity theft due to lost, stolen, or misused personal information, contact the North Carolina Low-Income Taxpayer Clinic of Charlotte Center for Legal Advocacy.

Phishing

Phishing is usually carried out with unsolicited e-mails or fake websites to steal your personal and financial information. All you must do is click on false links and your personal information could be compromised. 

Keep in mind, the IRS does not initiate contact with taxpayers by e-mail to request personal or financial information. 

Some tax scammers also use snail mail; so be aware, when you receive regular mail that purports to be from the IRS too.  If you are not sure, contact the IRS directly.

Tax Preparer Fraud

Keep in mind, as a taxpayer you are legally responsible for the information you represent on your tax return, even if the tax return is prepared by a third-party professional.

“Free Money” from the IRS

There is NO SUCH THING as “free money” from the IRS. Be skeptical of flyers and advertisements promising you “free money” from the IRS. If it sounds too good to be true, it probably is.

Need Help?

Contact the North Carolina Low-Income Tax Clinic.

Check out our other Tax Season Resources:

What to remember this Tax Season

What NOT to do when filing your taxes

Charlotte Tax Preparer Pleads Guilty for Filing False Tax Returns

from WSOC TV:

CHARLOTTE, N.C. — A Charlotte tax preparer pleaded guilty in federal court Friday for filing false tax returns for her clients and for herself.

Andrivia Wells entered a guilty plea for three out of 35 counts, including aiding and assisting the filing of false tax returns and filing false tax returns for herself. She did not address a charge related to obstructing criminal investigators from the IRS.

From 2011 through 2019, Wells ran Rush Tax Service out of three locations: Beatties Ford Road, Nevin Road and North Tryon Street. Federal prosecutors say Wells prepared more than 6,000 tax returns and received more than $1.2 million in fees from her clients. Oftentimes, the tax fees were taken from the clients’ tax refunds and clients were unaware of how much they were being charged, which was frequently more than $500.

According to the indictment filed in 2019, Wells filed clients’ tax returns with fabricated items, including wages, filing status, American Opportunity Credits, education credits, Schedule C business income and losses and more. The clients did not know what Wells was doing until they were contacted by the IRS with questions about items on their returns.

Shortly after Wells was notified about the investigation, prosecutors allege she set her Beatties Ford Road office location on fire. It was the very same day her summons response was due. The fire destroyed client files, financial records, and computer hardware.

If you’d like to safeguard your filings this tax season and you make less than $56,000 a year, Charlotte Center for Legal Advocacy attorney Arthur Bartlett said taxpayers should consider going to a Volunteer Income Tax Assistance site. There are locations across Mecklenburg County, and it’s sponsored and funded by the IRS.

If you do have to pay someone to file your taxes, Bartlett said to remember this important tip.

“Make sure you know you’ve looked at the return as best you can and you’ve asked questions where it doesn’t make sense because ultimately the IRS is going to hold you responsible, very likely, if the one you looked at and signed is the one that’s filed.”

The Charlotte Center for Legal Advocacy is assisting Wells’ victims. You can reach them at 704-376-1600.