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Tax preparers: Stimulus checks are not taxable income, answering honestly on tax returns only helps

Tax filing
Posted at 4:22 PM, Feb 08, 2021
and last updated 2021-02-08 19:21:42-05

BRYAN, TEXAS — Tax filing season is upon us. On February 12, the IRS will start accepting and processing 2020 tax returns. With confusion surrounding the addition of stimulus checks, experts want to remind everyone that stimulus checks are not taxed.

"They are not taxable. The only reason they are having us report them is because some people may not have received the full amount of stimulus they were eligible for. If that's the case, then they will actually get a credit on their tax return," said Jonathan Jones, owner of Bottom Line Bookkeeping in Bryan, Texas.

Jones is an enrolled agent and tax preparer. He says this tax season may be busier than in years past.

"This season is going to be, I think, much busier than it was in past seasons, just because of all of the confusion with the stimulus. People are not sure exactly what to do with it," he added.

Jones says you should plan to prepare and gather all of your important documents as your normally would while also keeping another thing in mind.

"Remember and or go back and look at your bank statements and figure out how much your stimulus was because that is going to be a big part of your tax return. They are giving a credit if you didn't get the full amount," he said.

Jones says claiming what stimulus funds you received or did not receive is a huge benefit, and answering honestly only helps.

"They [the IRS] have stated very clear it is not taxable income. It is not going to cause you any more tax. If anything, it will help you. Even if you got too much, it's okay. They are not going to take it back. They just want to make sure that everyone who was entitled to it did receive the full amount they were eligible for," he stated.

Brazos Valley residents understand this year may look a little different, but say preparing to file and filing on time is just as important as any other year.

"It's pretty important. I mean, if you don't do it, you'll know. We are business owners so we have to get ahead of the curve in some ways and figure out what we need to be doing, not just for 2020 but for 2021, to make sure we are doing things right for this year too," said Ashley Ralph of Brazos County.

Tax preparers say the confusion is entirely new for everyone, and this isn't something that has ever been done before so it's okay to ask questions.