Social Security beneficiaries won’t have to file tax returns in order to receive the coronavirus relief payments, the Trump administration announced Wednesday in a quick reversal of an earlier position.
“Social Security recipients who are not typically required to file a tax return need to take no action, and will receive their payment directly to their bank account,” Treasury Secretary Steven Mnuchin said in a news release.
Millions of Americans, including many receiving Social Security retirement and disability benefits, aren’t required to file federal returns because their incomes are so low they don’t owe federal taxes.
The vast majority of Americans are eligible for the $1,200 rebate Congress authorized last week, but on Monday the Internal Revenue Service announced everyone would have to file a tax return to receive the money.
Since then, dozens of Social Security beneficiaries told HuffPost they were unable to file online using the free services linked from IRS.gov ― presenting a major obstacle to their getting the benefits.
Sue Bohl, a 63-year-old Social Security Disability Insurance recipient in De Pere, Wisconsin, said she tried filing a tax return on Friday and wasn’t allowed to finish the form because she had no taxable income.
“Since my printer isn’t working, I’m not able to print it out to send it in,” she said. “It’s hard for me, because I don’t think it’s smart to be going out to do anything right now, so I’m stuck!”
Fifteen million households didn’t file taxes in 2019, according to the Urban-Brookings Tax Policy Center, and since Monday concern mounted that many would struggle to do so in order to receive the coronavirus payments.
House Ways and Means Committee chairman Richard Neal (D-Mass.) said his office had been “inundated” with phone calls from Social Security beneficiaries confused and upset about the policy. He demanded that Mnuchin change the policy and use other data sources to deliver benefits to Social Security recipients who don’t file federal tax returns.
“I am relieved that Secretary Mnuchin has heeded that call, but our work is not done,” Neal said Wednesday.
The text of the Coronavirus Aid, Relief and Economic Security Act ― signed into law by President Donald Trump less than a week ago ― said the payments would be based on tax information but specified that the IRS could use Social Security benefit statements to provide the rebate checks to some households. Mnuchin apparently did not like that idea but has now come around.
Non-filers who do not receive Social Security benefits, however, will still need to file tax returns if they haven’t for 2018 or 2019.
The administration should not require federal tax returns from people receiving Supplemental Security Income and certain benefits from the Department of Veterans Affairs, said Neal and Chuck Marr, a tax expert at the liberal Center on Budget and Policy Priorities.
“Treasury and the Social Security Administration and the Veterans Administration can match data to determine those SSI and veterans beneficiaries who are not part of a tax filing unit and then issue them automatic payments,” Marr said.
People with bank account information already on file with the federal government should see the coronavirus rebates sometime this month. Single adults earning less than $75,000 and couples earning less than twice that sum are eligible for payments of $1,200 and $2,400, respectively, plus $500 per child younger than 17.
The Treasury Department said in its release that Social Security recipients “will receive these payments as a direct deposit or by paper check, just as they would normally receive their benefits.”
Congress created the relief payments, which are technically advance tax rebates, as part of a $2 trillion bill designed to mitigate the economic damage of widespread measures that have shut down huge swaths of the economy in order to slow the spread of the coronavirus.
More than 200,000 diagnosed cases and 4,600 deaths nationwide have been confirmed as of Wednesday evening, with no clear end in sight to the stay-at-home orders and business closures, which have cost millions of jobs already.
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