Cash is a pressing need right now — economic recovery payments will help many, but not all

COVID-19 Policy Analysis: As our nation confronts the COVID-19 pandemic, OK Policy will be analyzing state and federal policies that impact our state and its residents during this national health emergency. These posts reflect the most current information available at publication, and we will update or publish follow-ups as new information becomes available.

NOTE: OK Policy is not a state agency and we cannot assist in applying for state services or provide legal advice.

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Money for necessary expenses is a critical need right now for many families who have lost work during this sharp economic downturn due to the COVID-19 outbreak. While various safety net programs can provide resources such as food and medical care, other needs may go unmet without some help of unrestricted, spend-as-needed cash. 

The Coronavirus Aid, Relief, and Economic Security (CARES) Act, passed in March by Congress, will help to meet this need with $1,200 economic impact payments for many individuals. These payments are needed and will be helpful to the individuals and families that receive them. We must also remain aware of those who will not be helped by this bill and continue finding ways to meet their needs as well.

Economic recovery payments are coming soon to many of us

Many Americans will be getting their economic impact payments in the next few weeks. For those who filed a tax return for 2018 or 2019, your payment will be based on your adjusted gross income (AGI):

Household Stimulus Payment
Individuals with an AGI of $75,000 or less $1,200
Heads of household with AGI up to $112,500 $1,200
Married couples filing jointly with AGI of $150,000 or less $2,400 ($1,200 each)
Tax filers will receive an additional $500 for each dependent child under age 17

Those with income above these thresholds will see their payment reduced by $5 for each $100 of AGI over the threshold. Those who will not be eligible for an economic recovery payment will be those with AGI of more than $99,000 for individuals, $136,500 for heads of household, or $198,000 for married couples filing jointly. 

Those who receive Social Security, Social Security Disability Insurance, or Railroad Retirement are not required to file a tax return but will still receive an economic impact payment. If you did not file a tax return for 2018 or 2019, you can still file now and be eligible for a payment if you meet the income criteria.

Your economic impact payment will not be considered as income

If you receive an economic impact payment, it will be treated as a tax refund. You will not have to pay federal or state income taxes on it next year, and it will not be counted as income for families who receive safety net benefits. In addition, this money is a stimulus payment — not a loan. Unless the payment is obtained fraudulently, you will not have to pay it back. 

Some of those most in need may not receive a payment

Not everyone with income below the guidelines will be eligible for an economic impact payment. You must have a Social Security Number to be eligible for an economic impact payment. If you are married and filing jointly, your spouse must have one as well. This requirement will result in many immigrants being ineligible for a payment, even if they filed a tax return with an Individual Taxpayer Identification Number. If the tax filer is not eligible for an individual payment, they will not be eligible for the $500 for dependent children either, even if the children have Social Security Numbers.

In addition, adult children who are claimed as a dependent on their parents’ tax return will not be eligible for either the $1,200 payment for adults or the $500 payment for dependent children. This could include college students and adults with disabilities who cannot live alone.

Finally, it may prove difficult to get payments to some people who are eligible. It will be challenging to distribute payments to individuals without a permanent address or a bank account because the Internal Revenue Service hopes to distribute most of the payments through direct deposit. Those who have filed a recent return and included their bank account information will receive their payments within a few weeks. The 7.3 percent of Oklahoma households that do not have a bank account, however, will have to wait for paper checks to be prepared and mailed — a process that could take months. Those without a mailing address might never receive their checks. Unfortunately, the unbanked and those experiencing homelessness are among those most in need of a cash infusion right now.

Stimulus checks will help, but more needs to be done

Cash is a pressing need right now, and many families will receive some help from the CARES Act. However, more help will be needed. The COVID-19 pandemic has spun us into a recession and unemployment could reach 30 percent in the coming months. With such a large part of our economy on hold, money to spend as needed will continue to be critical for families. Additional stimulus payments will be necessary. To be truly effective as an economic stimulus, future payments must include immigrant families, adults with disabilities, college students, and others who will be left out of this package. Relief packages that don’t reach everyone in need will result in increased need and a slower recovery, and that’s bad for all of us. 


Courtney Cullison worked for OK Policy from 2017 to 2020 as a policy analyst focused on issues of economic opportunity and financial security. Before coming to OK Policy, Courtney worked in higher education, holding faculty positions at the University of Texas at Tyler and at Connors State College in eastern Oklahoma. A native Oklahoman, she received an Honors B.A. in Political Science from Oklahoma State University, and an M.A. and Ph.D. with emphasis in congressional politics and public policy from the University of Oklahoma. While at OU, Courtney was a fellow at the Carl Albert Congressional Research and Studies Center. As a professor she taught classes in American politics, public policy, and research methods and conducted original research with a focus on the relationship between representatives and the constituents they serve.

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