LAST REVIEWED Apr 21 2021 5 MIN READ
By The Human Interest Team
The CARES Act signed into law on March 27, 2020, aims to provide relief to Americans feeling the financial side effects of the coronavirus pandemic. For many individual taxpayers, this will mean receiving a one-time payout of $1,200.
The $1,200 will be available to each adult making up to $75,000/year (or $2,400 to a married couple making up to $150,000).
In addition, there will be a $500 payment per child.
For any individual earner with an income exceeding $75,000, the pay-out will decrease by $5 for every $100 over $75,000 in adjusted gross income (based on the 2018 tax return or 2019, if you’ve already filed them).
Funds will be paid by direct deposit starting in mid-April, if banking information was provided in your most recent tax filing or by check (to be sent out late April) if not.
How can I check on the status of my payment?
On April 17th, 2020, the IRS will be launching a new “Get My Payment” tool that allows individuals to track when their payment is scheduled, including both payments by direct deposit as well as by check.
What if I moved since I filed my taxes?
If you moved AND are expecting a paper check, make sure it goes to the right place. Update your address with the IRS here.
If I don’t file routine taxes, where can I register for the stimulus payment?
For non-filers, the IRS has launched an online tool where U.S. citizens or resident aliens who 1) have a valid Social Security number, 2) could not be claimed as a dependent of another taxpayer, and 3) had adjusted gross income under certain limits can register to receive the Economic Impact Payment. Here’s the link to the tool.
Are you or your employees wondering, “what should I do with my pay-out?”
Some of us will use it to alleviate the pressures of mounting monthly expenses. For those who may not need the cash to immediately pay bills, consider putting that amount into a 401(k). You’ll have to use a payroll deduction from your employer to do this, but it’s worth it. Why?
A $1,200 investment today can multiply by two, three, or even four times before you retire. Let us show you what that may look like (assuming annual 5% returns). Note this is an illustration showing how a $1,200 investment today can grow over time.
That’s the gain assuming you put in $1,200 just once. But what if you put that amount in every year — $100 a month every month between now and retirement? It could grow much more, to roughly $85,000, assuming the same 5% rate of return.
Since our founding, Human Interest has been committed to providing small and medium-sized businesses and their employees with accessible, affordable benefits that help them secure their financial future. This mission continues to guide us today as we continue to respond to COVID-19.
Are you looking for more information about how coronavirus affects your 401(k) and your retirement plan?
Still have questions? Please don’t hesitate to call us at 877 475 0179.
Note: The $1,200 will be available to each adult making up to $75,000/year (or $2,400 to a married couple making up to $150,000). In addition, there will be a $500 payment per child. For any earner with an income exceeding $75,000, the pay-out will decrease by $5 for every $100 over $75,000 in adjusted gross income (based on 2018 taxes, or 2019 if already filed). Funds will be paid by direct deposit, if banking information was provided in your tax filing or by check. The date for sending out the funds is not yet set. The model above assumes a 5% annual return.
The Human Interest Team
We believe that everyone deserves access to a secure financial future, which is why we make it easy to provide a 401(k) to your employees. Human Interest offers a low-cost 401(k) with automated administration, built-in investment advising, and integration with leading payroll providers.