CARES Act

Tracking IRS Economic Impact Payments and Reasons for Delays

By now you most likely have heard about the Economic Impact Payments that were introduced with the CARES Act. It is an advanced payment of a 2020 tax credit of $1,200 for single filers or $2,400 for couples filing joint returns. Eligibility depends on AGI limitations which are applied by looking at a taxpayer’s 2018 or 2019 tax return. Please see our resource guide of the CARES Act and the Economic Impact Payments for more in depth information.

Non-Filing Tool
The IRS has released a tool on its website to help individuals who are not required to file an income tax return get their Economic Impact Payments. More information about this tool and who should use it can be found in our article IRS Launches a New Tool to Help Non-Filers Register for Economic Impact Payments.

Check Your Status
The IRS has also released a tool that can help individuals track their Economic Impact Payment status and allows them to enter additional information, if required. The tool can be found in the coronavirus section of the IRS website.

Economic Payment Issues
The Economic Impact Payments were released mid-April; however, many individuals have been reporting issues and have not yet received their payments. Some of the more common issues that individuals have been having regarding their Economic Impact Payments are as follows:

  • Information has changed – If some information related to your tax return has changed since you last filed a tax return, such as moving or having new dependents, you may not have received your payment. A simple fix for this is to file your 2019 tax return if you have not done so already with your new information.
  • Direct deposit was not set up with the IRS – Some taxpayers may not have had their bank account information included on their tax return and won’t be able to receive their payments via direct deposit. The “Get My Payment” tool can be used to enter your bank account information so you can have your payment sent via direct deposit. The IRS will also be sending out physical checks to anyone else who does not have their bank account information set up in the upcoming months.
  • “Payment status not available” on the Get My Payment tool – Many users have reported seeing a message that reads “payment status not available” when checking their status using the Get My Payment tool. This can be a result of a few different reasons, the most common being that you don’t qualify for the payment or that the IRS is processing your information. The links provided above can help determine eligibility for the Economic Impact Payment and track your status. If you have recently filed your 2018 or 2019 tax return, the IRS may still be processing the return and won’t issue your payment until that process is complete. The Get My Payment tool gets updated overnight so there is no need to check your payment status more than once a day.
  • Locked out of Get My Payment – As a security precaution, if the IRS is unable to verify your identity, you may be locked out of the system. These lockouts will generally just last one day, so you can try again the following day.
  • Didn’t receive additional payments for children – There have been many reports of taxpayers not receiving the additional $500 payment for qualifying children. The IRS has been made aware of this issue and has stated that they are looking into it. This has not affected all taxpayers as others have reported receiving the additional $500 per child.
  • Bank account is overdrawn – Banks do have the legal authority to withhold funds from accounts that have been overdrawn and present a negative balance. The CARES Act does not have a provision that makes an exception for the Economic Impact Payments. Some banks have decided to not seize any amounts related to the Economic Impact Payments.
  • Married to a non-resident and file a joint tax return – For couples that file a joint tax return, both individuals must have a valid SSN to receive their payment, unless either partner is a member of the U.S. military during the tax year. It is still expected that the couple will qualify for the full credit when they file their 2020 tax return however, they will not receive an advanced payment.
  • Resident of Puerto Rico – Due to special rules that are applicable to U.S. territories, direct deposits will not be released to residents of Puerto Rico until the U.S. Treasury has approved Puerto Rico’s distribution plan.

The IRS has a frequently asked questions page. The information on this page is being updated regularly, so the IRS is encouraging taxpayers to check back often. If you have any questions regarding the Economic Impact Payment, please consult your HBK tax advisor, we are standing by and ready to help.

About the Author(s)
Frederik Sdrenka is an associate with HBK CPAs & Consultants in the firm’s Tax Advisory Group, focusing on tax compliance and consulting for individuals and closely-held businesses. Frederik joined the Tax Advisory Group in 2019 and has been involved in HBK’s Foreign and International Tax Practice. He has tax experience in U.S. planning and compliance related to individual foreign tax and residency issues. He currently spends a significant amount of time researching complicated tax issues for high net worth individuals involved in incoming and outgoing foreign transactions
Hill, Barth & King LLC has prepared this material for informational purposes only. Any tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or under any state or local tax law or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein. Please do not hesitate to contact us if you have any questions regarding the matter.