Nope, the stimulus money that you received from Uncle Sam will not count as taxable income. So that’s one less thing you have to worry about when Tax Day rolls around!
Let’s back up a little bit. In March 2020, the U.S. government passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act in an effort to try and provide help to everyday Americans during the height of the coronavirus pandemic.
Individuals who filed taxes in 2018 or 2019 received $1,200 for each adult and $500 for each child. So a household with two adults and two children, for example, most likely received $3,400 in stimulus money.1
So, why isn’t that money being counted as taxable income? Because it’s being treated like a refundable tax credit for 2020. Translation: Your stimulus check is sort of like an advance on money you would have received anyway as part of your tax refund in 2021.