Eligible individuals who are not otherwise required to file federal income tax returns for 2019 may use a new simplified return filing procedure to make sure they receive the Economic Impact Payments (EIPs) provided by the Coronavirus Aid, Relief, and Economic Security (CARES) Act ( P.L. 116-136).
Alternatively, these eligible individuals may use the “Non-Filers: Enter Payment Info Here” tool, available at www.irs.gov/coronavirus to submit the information the IRS needs to issue their payments.
EIPs and Recovery Rebate Credit
The CARES Act provides a fully refundable Recovery Rebate Credit for the 2020 tax year. However, the IRS is making EIPs during 2020 to refund the credit in advance, based on 2019 or 2018 information. Most individuals are eligible for the credit, except for nonresident aliens and individuals who qualify as another taxpayer’s dependent.
The maximum credit is $1,200 for each eligible individual, plus $500 for each qualifying child. There is no minimum income requirement, but the credit is phased out for higher-income individuals. Eligible individuals and qualifying children generally must have valid Social Security numbers.
Taxpayers who filed 2019 or 2018 returns automatically receive their Economic Payments. If the taxpayer identified an account for direct deposit of a refund, the Economic Impact Payment is direct deposited into the same account. Otherwise, the IRS mails a paper check to the taxpayer’s last known address.
Nonfilers who received Social Security and railroad retirement, survivor or disability benefits before 2020 also receive EIPs based on their Forms SSA-1099 or Form RRB-1099 via direct deposit or paper checks, in the same way they receive their benefits. Recipients of supplemental security income (SSI) or Veterans Administration Compensation and Pension (C&P) benefits also automatically receive EIPs in the same way they receive their benefits. These nonfilers may use the “Non-Filers: Enter Payment Info Here” tool to provide information about their qualifying children so that they also receive the $500 additional credit.
Other nonfilers who are not required to file returns, such as people with income below the filing threshold, may use the “Non-Filers: Enter Payment Info Here” tool to provide basic information that allows the IRS to calculate and issue their EIPs.
Simplified Filing Procedures
Rather than using the “Non-Filers: Enter Payment Info Here” tool, a simplified return filer may use a simplified procedure to file a paper or electronic return for 2019 on Form 1040, U.S. Individual Income Tax Return, or Form 1040-SR, U.S. Tax Return for Seniors. A simplified return filer is an eligible individual who:
- has not filed a federal income tax return for 2019;
- is not required to file a return for 2019, and
- has the required identification number.
Simplified returns are due by October 15, 2020. The IRS urges these individuals to file electronically to speed receipt of their payments.
Simplified Return Information
The simplified return should include only the following information:
- “EIP2020” written on the form;
- the individual’s filing status as of the end of tax year 2019;
- required identification information, including name, mailing address, and SSN for the individual (and spouse on a joint return);
- information regarding each dependent who was under the age of 17 at the end of tax year 2019; and
- the filer’s signature, using an IP PIN if applicable.
Generally lines 1 through 24 of the return are left blank, even if the values for these lines are in fact not zero, except as values are required for electronic returns.
The IRS will compute the Economic Impact Payment based on this information. The IRS will not challenge the accuracy of the items of income that are properly reported under these procedures.