Treasury Now Will Send Coronavirus Payments To Social Security Beneficiaries Without Income Tax Returns. That May Be Bad News For Many.

Treasury Now Will Send Coronavirus Payments To Social Security Beneficiaries Without Income Tax Returns. That May Be Bad News For Many.

Last night, the Treasury Department announced it was reversing course and would make direct coronavirus rebate payments to Social Security beneficia

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Last night, the Treasury Department announced it was reversing course and would make direct coronavirus rebate payments to Social Security beneficiaries even if they do not file tax returns. The decision was hailed as a victory by advocates for low-income seniors.  But, in fact, those Social Security beneficiaries would likely get their money much faster if they do file a federal income tax return.

The twists and turns are hard to follow. But here is the short version of the story: The Coronavirus Aid, Relief, and Economic Security (CARES) Act that Congress passed last week provided for payments of $1,200 for adults and $500 for children under age 17. But to get the money, most people would have to file a federal income tax return for 2019 or, failing that, for 2018.

But the law allowed an exception for those who received Social Security benefits–reported on a Form 1099-SSA. It said the IRS would send them a payment automatically even without a Form 1040 income tax return. But on March 30, the IRS changed course and announced that those older adults would have to file a “simple” tax return to get their money.

Firestorm

This created a firestorm among advocates and some on Capitol Hill who argued, with some justification, that the filing requirement would result in millions of Social Security beneficiaries missing out on the payment.  In a similar situation in 2008, about 3…



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