IRS Confirms Stimulus Funds Will Be Given To Individuals Who Died In 2020: That is Wealthy! questions and solutions

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CLEVELAND, Ohio – Why is my property tax so high? Do you still have to pay income tax if you work from home in another city due to coronavirus? And what if, at the end of government money, a stimulus check comes in for a deceased parent?

These are some of the questions sent to That’s Rich! recently.

This is rich! – My mother died of COVID on December 26th. Will she get the Fed’s $ 600 stimulus check, and if so, is it legally correct? Since she didn’t do anything digitally, it would surely come as a physical review. I would hate to get a check and cash it and then find out later that she / her estate was not entitled to it and has to pay it back, God forbid with penalties. I know that Congress passed the new Stimulus Bill shortly before her death and the President signed it shortly afterwards. So I’m not sure about that. – Vince

Vince – The stimulus package you mentioned was signed into law on December 27th, the day after your mother died. While you are unlikely to receive the money unsolicited at this point, it will be provided on your mother’s behalf as you fill out her 2020 tax form, the IRS confirms.

The IRS explains eligibility for stimulus payments as follows: “In general, if you were a U.S. citizen or resident alien in 2020, were not dependent on another taxpayer, and have a valid Social Security number, you can apply for the refund credit. This includes someone who died in 2020 preparing a return for that person. “

An IRS spokesman said who is specifically entitled to the money: “It depends on their estate status. But his mother’s estate is entitled to it. Another problem is when others are in the will or otherwise entitled to part of the estate, such as siblings. “

This is a reversal of what the IRS said after the first round of stimulus last spring. The IRS issued a statement in June saying that money must be returned if it occurs after someone dies.

Nina Olson, executive director of the Center for Taxpayers Rights, said this was resolved under the second stimulus package and retrospectively covers the first stimulus checks – money the IRS originally asked for return.

“Congress explicitly stipulated in law that people who died in 2020 are not only eligible for the second payment round, but also for the first,” said Olson. “This is really helpful for all of those people who have filed their late spouse’s payment under the direction of the IRS. They can claim this $ 1,200 plus the $ 600 on their 2020 tax return unless they were able to redeem them. “

This is rich! – I was shocked by my January property tax bill. I moved into my current residence about 10 years ago and bought a unit for about $ 137,000. The last valuation put it at $ 170,000, which I denied. … I will have to move. I do not qualify for the Homestead exemption and am a retired school teacher. It’s shameful what the appraisals, property taxes, and what cities have done to add fees to seniors. I hope future articles can find solutions to these problems. – Joan

Joan – Likely because you were challenged on value, your home is now receiving less taxation from the county than it was before you bought it in 2011 (even though 9.6% above your purchase price). This is a good lesson for people who are unhappy with their assessment. Appeal. Your tax bill is now actually lower than what the previous owner paid a decade ago, County Records show.

But you raise another problem, that of homestead exemption. As I mentioned earlier, in 2013 lawmaker and Governor John Kasich removed this senior citizen discount for those who turned 65 after January 1, 2014, unless they qualified as low-income. This break had previously been offered to all seniors. What amazed me about this change is that it was made without public outcry. The cities did not do that; This is a question for the legislature in Columbus. Tell your state representative and senator what you think.

This is rich! – We lived in our previous home for 50 years and had the homestead exemption for many of them, certainly before 2012. We moved to another home in Cuyahoga County in 2019 and will apply for the exemption for that home. We don’t qualify by income level, but can we claim it because we had it in 2013, although in a different house? – Carol, Mayfield Heights.

Carol. Yes. This is a benefit if you are old enough before the state changes the program. I forwarded your question to the Ohio Treasury Department and the answer was straightforward, “Yes, if you had a homestead with no income test for 2013, you are grandfather on the lifelong no-income testing program.”

This is rich! As with many people, my husband has been working from home since March 16. My question is, why on earth do we still have to pay RITA taxes to Beachwood when he hasn’t worked in Beachwood town since March 2020. And to make matters worse, we need to “apply for a refund” to get a refund for those taxes. It is clear that, like many, many people, we are wrongly taxed. RITA informed us that we may be eligible for a refund due to ongoing legal disputes. We shouldn’t have to ask to get our money back from a city where he didn’t work. – Eileen

Eileen. They make essentially the same argument in the Buckeye Institute’s lawsuit against the City of Columbus that it is illegal to tax people where they do not work or live. As of now, even the Buckeye Institute agrees that this is the case under the pandemic law that legislators passed in March to record people whose place of work has changed due to COVID-19. It could take years to resolve the suit. The best advice I can give to anyone in this situation without filing their own lawsuit is to keep a log of where you work, submit and approve any available documentation such as the RITA refund application form (available on the RITA website) waiting .

Side note here. There is no RITA tax. RITA (Regional Income Tax Agency) is commissioned by cities and villages to collect their taxes for them. RITA is just the administrator.

This is rich! – I liked the January 21st article on RITA Refunds for Individuals Forced to Work from Home Due to COVID. This is an important issue that affects so many people. I saw the paragraph at the end of the article on CCA that didn’t address this yet. I would imagine this would affect most people as many worked in Cleveland and were forced to work from home. CCA has a refund worksheet that seems to cover this general topic but doesn’t specifically mention COVID-Mark

Mark. You’re right. The Cleveland Central Collection Agency (CCA), which manages municipal income taxes for Cleveland and dozens of other cities and towns, has a downloadable refund form on their website that is similar, if not identical, to the form used in previous years. However, there are no specific changes for COVID work situations. There is a box with a check-in option to justify a refund request, some of which reads, “If you did not work in the township listed on your W-2, please include the name of the city of work.”

I asked City Hall if there was an update coming and the answer was that the existing form is the 2020 refund form. However, if there are later updates, these will be posted on the CCA website along with other tax forms.

Rich Exner, Data Analysis Editor, writes the personal finance column for cleveland.com and The Plain Dealer – That’s Rich! Follow @RichExner on Twitter.

Email questions and suggestions to rexner@cleveland.com. Include your hometown and first name for publication. And to help sort out the clutter in my email box, remember to say “That’s Rich!” in the subject of the email.

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