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Wait, What? The IRS Can Ask You To Return Your Stimulus Check. There are a few scenarios where you may be asked to give your money back.

By Aman Jain

entrepreneur daily

This story originally appeared on ValueWalk

BackyardProduction | Getty Images

Talks are ongoing currently to give Americans another round of stimulus checks. However, there are a few scenarios in which the IRS can ask you to return the coronavirus stimulus checks you got earlier, either full or partially.

Since the approval of the first stimulus checks by Congress, the IRS has sent out millions of checks to eligible people. However, there are still many who haven't yet got the stimulus payment even though they are eligible. Such people may have to file taxes to claim their payment.

On the other hand, there have also been cases when people got the stimulus payment, even when they were not eligible. Or, they got a check of a higher amount than they were eligible for. Such things did happen at the time of the first payment, and in many cases, the agency asked these people to return the payment.

Short-sellers have been feeling the pain for months, but especially over the last two weeks. In his fourth-quarter letter to investors, Maverick Capital's Lee Ainslie pointed out the unprecedented levels stock prices have reached and why short-sellers have been hurting. Q4 2020 hedge fund letters, conferences, and more

So, there may be similar cases with the second stimulus checks as well, which the IRS started sending out earlier this month. Thus, it is important for you to know the scenarios in which the agency can ask you to return your stimulus checks.

Return-your-check scenarios

The first such scenario is if you are a "nonresident alien," who is deemed ineligible for stimulus checks. Though Democrats made efforts to include this group at the time of the second stimulus checks, they were still not eligible. So, in case you are a nonresident alien and have received a check, then it is likely an error. Thus, the IRS may ask you to return the stimulus checks.

Another scenario is if you are a taxpayer but are not a U.S. citizen. If you fall into this group, but still got the check, then it is likely because you file federal taxes and the IRS has your details in its system. In such a case also, the IRS may ask you to return the payment.

Among all the eligibility requirements to qualify for the stimulus checks, one primary requirement was having a Social Security Number. Though there were some discussions to send checks to taxpayers with other types of identification as well, such talks never materialized. So, if you got the check, but don't have a SSN, you may have to return your coronavirus stimulus check.

You may also have to return the check if the IRS sent you the check, but you were not eligible because your income was too high. Those with adjusted gross income (AGI) of $75,000 or less, got a stimulus check of the full amount, while the amount decreased for those with income up to $99,000.

So, if your AGI (as per your recent tax filing) is $99,000 or more, but you still got the payment, you may be asked to return your stimulus check.

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