What Divorced and Unmarried Parents Need to Know about CARES Act Family Relief Payments

COVID-19 has hit families hard in Michigan and across the country. For divorced and unmarried parents, there are family law issues with parenting time and transporting children between residences during our state’s “Stay Home, Stay Safe” order. Above all, anxiety over the financial fallout of the coronavirus is second only to the fear of contracting the virus itself.

How Coronavirus Emergency Relief Payments Work

To bolster the economy during the COVID-19 crisis, Congress enacted the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Besides increased unemployment benefits, the act aims, in part, to deliver a relief check directly to Americans with Social Security or adoption identification numbers. U.S. citizens and residents not identified as tax dependents will receive a maximum payment of $1,200 per adult and $500 per child.

The CARES Act provides adults who file tax returns jointly a maximum payment of $2,400, so a family of four earning less than $150,000 can expect $3,400. Payments will be reduced for individual recipients with income up to $75,000 per person, $112,500 for a head of household, and $150,000 per couple. The stimulus check amount is further reduced by $0.05 for every dollar of income over these amounts.

To determine the amount you may receive, Forbes, H&R Block, USA Today, and other websites.

COVID-19 Relief Payments for Parents

Distribution of economic impact payments for children will be based on information of the taxpayer who claimed the child on a 2019 income tax return.

• For parents who have yet to file their 2019 tax return, the payment will be based upon which parent claimed the child in 2018.
• For eligible recipients who did not file returns for the last two years, the payment will be available when the 2018 or 2019 return is filed, but it must be filed before the end of 2020.

Parents should be aware that relief payments may offset past-due child support obligations.

As to where checks will be sent, that also depends on parents’ tax returns. For parents who filed a joint return in 2018, were divorced in 2019, and neither has filed a 2019 return, the CARES Act provides that the payment will be directly deposited to the bank or credit union account identified on the 2018 return. If that account has been closed, the joint payable refund check will be sent to the address on the 2018 return.

If there is a concern that an ex-spouse may not share in a payment, or if neither parent lives at the address listed on the 2018 return, a temporary change of address notice is available through the United States Post Office.

Unfortunately, the law is ambiguous, and many people’s lack of familiarity with the details may lead to conflict between parents who could potentially receive the payments. Divorced and unmarried parents should proactively communicate with each other about economic impact payment to avoid significant costs and stress associated with taking their dispute to court.

Speak With Kreis Enderle’s Litigation Attorneys

The Family Law Group at Kreis Enderle is helping parents unravel the complexities of the federal CARES Act and similar coronavirus-related laws and orders in Michigan. If you have questions about these or other family law issues, we’re still open business. We are working remotely and utilizing phone and video conferencing to communicate with clients.