1 1 (March 23, 2020)

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              Researh Sevice

COVID-19 and Stimulus Payments to

Individuals: Summary of the 2020 Recovery

Rebates in the March 22 CARES Act

March 23, 2020
The Coronavirus Aid, Relief, and Economic Security (CARES) Act, circulated on Sunday, March 22,
2020, proposes direct payments intended to broadly stimulate the economy in response to concerns about
an economic slowdown stemming from the COVID- 19 pandemic. This Insight provides a brief overview
of the proposed 2020 recovery rebates included in the March 22 legislation, which differ from those
introduced on March 19.
The proposed 2020 recovery rebates equal $1,200 per person ($2,400 for married taxpayers filing a joint
tax return) and $500 per child. These amounts would phase down for higher-income taxpayers. These
payments are structured as tax credits automatically advanced to households in 2020 if theyfiled a 2019
income tax return and would be received as a direct deposit or check by mail. If a 2019 return had not
been filed, rebates would be advanced automatically based on 2018 return information. Seniors who did
not file an income tax return would have the credit automatically advanced in 2020 based on their 2019
Social Security benefit statement.

Credit Amount
The proposed credit equals S 1,200 per person ($2,400 for married joint filers) for eligible individuals.
Generally, an eligible individual is any individual excluding (1) nonresident aiiens, (2) individuals who
can be claimed as a dependent by another taxpayer, and (3) an estate or trust.
Individuals eligible for the credit would receive an additional $500 for each child that qualifies for the
child tax credit.
The total proposed credit phases out at a rate of 5% of adjusted gross income (AGI) above $75,000
(S112,500 for head of household filers and S150,000 for married joint returns). An illustration of the
amount of the rebate by income level is provided in Figure 1 below.

                                                             Congressional Research Service

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