Under the Trump administration’s $2.2 trillion CARES Act, the Internal Revenue Service is sending $1,200 to individuals with annual adjusted gross income below $75,000 and $2,400 to married couples filing taxes jointly who earn under $150,000, plus $500 per qualifying child. The payments begin to shrink above those levels. Do you think that threshold is too low or too high?
MarketWatch readers have strong opinions on that issue:
On Monday, a reader named John wrote to The Moneyist to say he did not receive a $1,200 stimulus check because he filed his 2019 taxes early. However, had the IRS assessed him on his 2018 tax return, he says he would have received $1,200. John told MarketWatch:
“In 2018, I made about $155,000 with my wife. In 2019, I got a promotion and our combined annual income was $198,000. I filed my taxes early as I am very responsible, and now I found out that, had I had not filed my 2019 taxes, we would have received a combined $2,400 versus the $200 we just received. I was punished for being responsible. I find this very unjust, and poorly thought out.”
Some readers, like Glenn, qualified for the $1,200 stimulus check, but although Glenn earns even less money than John he’s going to give it away to those less fortunate. “That money should be going to people who need it a lot more than we do,” he said. He added:
“My wife and I earn $90,000 a year. She has Social Security and I will retire this summer. COVID-19 is hurting our retirement funds, but we need to have a little perspective. I’m not losing my job. We aren’t going to have trouble paying our mortgage or buying food. The federal government needs to discriminate between the needy and the merely unfortunate. I’m giving my stimulus check away.”
“Having my job moved online is increasing my work load by 50%. Still, I will find some time this week to figure out how to give my $1,200 stimulus check to where it should have gone in the first place. Are there funds in my city to help laid off workers? Funds to help small business owners pay their rent? I don’t know, but I am going to find out. If not, I will give it to a Food Bank.”
Deena wrote to The Moneyist to say the stimulus checks don’t go far enough: “ALL of our incomes are being effected by the coronavirus and our stimulus checks should be distributed equally. I think its funny that people think $150,000 is too high.”
Deena wrote: “As a married person with 5 kids and a mother that lives with us I think $150,000 is too low. Kids are expensive and they eat a lot, not to mention medical and dental bills, especially now that school is out. You also have to take into consideration cost of computers and printers for them to be able to work on their school work at the same time.”
Another reader, Rachel, also responded to John’s letter. She wrote that she recently lost her job. “Chances are that we will make even less money this year, so maybe the point is moot for us,” she said. Like Glenn, she believes a $150,000 threshold is too high. Rachel wrote:
“I happen to feel that the $150,000 threshold for a couple filing jointly is too high. I live in Connecticut, but with an annual household income varying between $45,000 and $60,000, I consider ourselves members of the working poor. Unless one has medical bills, a family making $150,000 should be able to put food on the table without help from the government. We consider ourselves fortunate.”
The Moneyist replied to John’s dilemma, and said, “There are many people out there living paycheck to paycheck.” He said he’s out of luck and unlikely to receive a $1,200 stimulus check unless he earns less money in 2020 and receives a credit in his 2020 tax returns:
“The IRS is using 2018 tax returns as a Plan B for those who did not file their returns for last year. It’s not a Plan A. Take heart that those who need it the most will hopefully receive their payment. The IRS will also assess your eligibility based on your adjusted gross income from 2020, so if you earn below the threshold this year, you will likely receive the difference in your refund.”
Dispatches from a pandemic:Letter from New York: ‘New Yorkers wear colorful homemade masks, while nurses wear garbage bags. When I hear an ambulance, I wonder if there’s a coronavirus patient inside. Are there more 911 calls, or do I notice every distant siren?’
Coronavirus update: As of Wednesday, there were 2,624,846 million confirmed cases of coronavirus and 183,120 fatalities. Over 247,500 of the 840,476 confirmed cases in the U.S. were in New York State. There were 15,074 deaths in New York City and 46,611 nationwide, the national epicenter, according to Johns Hopkins University’s Center for Systems Science and Engineering.
You can email The Moneyist with any financial and ethical questions related to coronavirus at email@example.com
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