When President Trump signed the CARES Act last spring, part of the legislation provided for a $1,200 stimulus payment to citizens making less than $75,000 a year. As we all know, a second round of $600 checks was included in the most recent stimulus bill. And, if Congress passes anything resembling his $1.9 trillion plan, President Biden looks poised to sign more third-round stimulus payment legislation in the near future.
The money will go to people in need of financial help during the pandemic. But does this include those who are incarcerated? Can prison inmates get stimulus checks?
In today’s blog post, I will cover the following topics:
- IRS ordered to give prison inmates a chance to claim stimulus payments
- Getting stimulus payments for prison inmates has been difficult
- Can people still incarcerated get stimulus checks?
- Will prisoners get a second stimulus check?
- Who is eligible for Recovery Rebate Credit?
- How to Calculate the Restoration Rebate for Your Inmate
IRS ordered to give prison inmates a chance to claim stimulus payments
When the first stimulus payments were sent out last spring, a court ordered the IRS to give prisons and people in jail the chance to claim the $1,200 payment after a lawsuit was filed against them.
However, the process took several months, and in the meantime, there was a lot of confusion about whether prisoners were eligible for the payments. Deadlines for filing claims have come and gone. The deadline to submit physical documentation for stimulus check applications is November 4, 2020. The deadline to submit an online application is November 21, 2020.
Because jails and prison inmates don’t have access to the internet — and because many prison officials don’t give their inmates the opportunity to submit physical documents — many prison inmates miss out on these payments.
Getting stimulus payments for prison inmates has been difficult
Those November deadlines came in late October, making it difficult for most prison inmates to get their stimulus checks.as central network Note that the deadline also comes after confusing and often conflicting guidance from the IRS. At first, the IRS sent money to some jails and prisons, and then it was coming back!
It wasn’t until a federal judge in California responded to a class action lawsuit that the IRS began sending forms to prisons across the country so the 2.3 million incarcerated people could try to get their checks.
The IRS appealed the judge’s decision and requested an injunction against the ruling. However, according to the IRS website, they “cannot deny payments to eligible incarcerated individuals.”
Still, there are reports of facilities actively preventing forms and newsletters about payments from reaching inmates. There have also been reports of payments being received fraudulently in the names of detainees.
Can people still incarcerated get stimulus checks?
This is a difficult question to answer. Since the November deadline has passed, there is no longer a place on the IRS website for non-filers to enter their payment information. For prison inmates who did file their 2019 tax returns, the deadline has still passed. But there is hope. Prisoners can get their money, but it will take some time.
Will prisoners get a second stimulus check?
For the $600 and $1,200 payments that have already been sent, there is one way you can help your incarcerated loved ones get those stimulus checks.
All you need to do is file a 2020 tax return for your inmate. You can report zero income (if they didn’t make any money last year) and claim a “recovery rebate” tax credit. By law, the first payment of $1,200 and the second payment of $600 are only advances on the line of credit.
If the sum of the two stimulus amounts is less than the reinstatement rebate, they may be able to get the difference back in the form of a rebate.
Who is eligible for Recovery Rebate Credit?
according to MSN.comthe eligibility rules for reinstating rebate credits are essentially the same as for receiving first and second stimulus checks.
The biggest difference is that stimulus check eligibility is based on information from 2018 and 2019 tax returns. Eligibility for the reinstatement credit is based on information on your 2020 tax return.
In general, you are eligible for the Restoration Rebate if you met the following criteria in 2020:
- Aliens who are U.S. citizens or U.S. residents;
- cannot be claimed as a dependent on someone else’s tax return; and
- Have a social security number valid for work that was issued before the due date of your 2020 tax return (including extensions)
How to Calculate the Restoration Rebate for Your Inmate
Calculating recovery rebate credits is the same as calculating stimulus checks. It starts with a base amount, $1,800 for most people. That figure came from two checks for $1,200 plus $600.
If the prisoner is the head of the household, pays child support, or is married filing jointly — basically, if the prisoner is not single and has no dependents — those numbers will change.For more information about this situation, see the IRS website, or Try this MSN article This will cover prisoners with spouses and dependents in more detail.
Once the base amounts are added, it is possible to determine if the rebate credit has been reduced due to income. Obviously, a prisoner who is incarcerated throughout 2020 will not have any income. This means credit will not be reduced.
You will report the $1,800 refund on line 30 of your inmate’s 2020 federal income tax return. Because it’s a “refundable” credit, they’ll get that amount because they don’t have to pay other taxes.
Remember, your inmates will receive paper checks unless they have a bank account and you have direct deposit information. Do not send checks to prison inmates, as most facilities do not accept payments made directly to inmates.
Instead, you must deposit the check into the inmate’s account through whatever method the facility uses. Most prisons use JPay for inmate accounts.
If your inmates haven’t received their stimulus checks yet, there is still hope. However, you will have to help them. Your inmates can get their money through tax rebates, but you must fill out these forms for your inmates. You can also send your 2020 tax return to your inmate with instructions on how to complete it.
We are not tax professionals or lawyers. While all of this is sound advice, we recommend that you consult a tax professional if you have any questions about claiming this credit for prisoners.
Did your incarcerated loved one receive a stimulus check? Let us know in the comments below.
Sources: Confirmed: Inmates Eligible For Cares Act $1,200 Stimulus Checks From IRS; Here’s How To File People who are in prison can get a stimulus check, but there's a catch. What to know today Stimulus, round 2: Incarcerated people will be eligible for new round of payments The Recovery Rebate Credit: Get Your Full Stimulus Check Payment with This Tax Credit