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There is no defined time frame of when this pandemic will end and no defined time frame of if or when the federal government would pass additional coronavirus economic relief and what that might look like. Both the U.S. Treasury Secretary, Steve Mnuchin, and the head of the Federal Reserve, Jerome Powell, have indicated to Congress a desire to see additional relief passed. As many people continue to follow this debate they are asking themselves questions about the already passed stimulus package and wondering, “Where does this money come from?” and “Do I claim this as income for my 2020 taxes?”.

First off, the money is technically a rebate of your 2020 income taxes, paid out to you in the future. So, the money your receiving is after all your money. But rather than this money being spent on typical government services the federal government has returned it in the form of an economic relief package.

This brings up a second natural question, “how does this impact my 2020 taxes?”. The good news to this is, it doesn’t! The stimulus payments are not taxable.  They’re an advance on a new credit on your 2020 federal income taxes.  Part of the reason the government decided to make the money a rebate on a future tax payment is to help avoid any adverse tax implications that would decrease the impact of the stimulus checks on our economy.