The IRS issued COVID Tax Tip 2020-55, answering taxpayer questions about the economic impact payments.
“Are economic impact payments considered taxable income?”
The IRS stated that the economic impact payments are not considered taxable income. Therefore, individuals will not owe tax on the amount of economic impact payment received. Further, economic impact payments will not:
- Reduce a taxpayer’s refund
- Increase the amount a taxpayer owes when filing his/her 2020 tax return
- Affect a person’s income for purposes of determining eligibility for federal government assistance or benefit programs.
For additional questions related to the economic impact payment or assistance filing your tax return, please contact BMD Tax Law Attorney Tracy Albanese at firstname.lastname@example.org or (330) 253-9195.