The Coronavirus Aid, Relief, and Economic Security (CARES) Act (H.R. 748) is a $2.2 trillion package to help individuals and businesses get through the health and economic crisis triggered by COVID-19. The Act is extensive and impacts not only taxes in 2020 but in prior years as well. Because of the huge scope of the Act, only tax rules are covered here.

Rebate Checks for Individuals

Rebate checks are advanced payments of a new refundable tax credit (Code §6428). These rebate checks for individuals with adjusted gross income (AGI) below set amounts are being paid through the IRS. Eligibility is determined by AGI on 2019 if returns for 2019 have been filed, or on 2018 returns if the 2019 returns have not been filed. Different AGI thresholds apply to joint filers, heads of households, and other filers (singles and married persons filing separately). There is a phase-out range in which individuals can receive a partial payment. There is an added amount for each child; an individual who is another taxpayer’s dependent does not receive a rebate check.

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