Your Stimulus Check Eligibility Could Depend On Your Taxes
If youre right on the cusp of the income limits described below, when you file your taxes could make the difference between qualifying for a partial check or not. Thats because a third stimulus check is now arriving during tax season.
The language in the stimulus bill makes it clear that the IRS will base your next stimulus check on your 2019 or 2020 taxes, whichever is on file when it processes your payment. However, the IRS is reportedly delayed in processing new tax returns. If you made more in 2020 than in 2019, time is on your side. The new tax deadline is May 17. If you need more time, you might want to request a tax extension.
At this point of the stimulus check delivery cycle, filing taxes sooner may not be to your advantage. The IRS is prioritizing stimulus check distribution over tax returns, and when the processing happens is outside your control.
If you did already receive your third stimulus check and it was based on your 2019 taxes but you qualified for more with your 2020 return, the IRS will be sending plus-up payments to correct the amount between now and Dec. 31, 2021. If you dont receive your catch-up payment by then, youll need to claim it on your taxes next spring.
Are We Getting Another Stimulus Check In 2021
Whether we get another stimulus check in 2021 depends on how much momentum the proposals for more checks gain.
There are still some people who’ve not yet received the third stimulus check, but we’ve got a handy guide for what to do if you’re missing your stimulus check payment. It’s worth checking if you’re eligible for most recent stimulus check as it’s worth up to $1,400 per person.
The IRS has reported that taxpayers whose direct-deposit information is on file should have seen their payments reach their bank accounts in April. Those who are waiting on paper checks and debit cards can expect to receive their funds in the coming weeks.
If you have received the third stimulus check and feel it’s too low, then take a look at our guide to the stimulus check calculator as that can show you what your own eligibility looks like. Keep in mind that there are a few factors that will affect the amount you are due or have received.
Biden Wants Child Tax Credits Increase Extended Indefinitely
One of the key inclusions in the new stimulus bill is a complete overhaul of the child tax credits provision which would see claimants able to receive up to $3,600 per year. As it stands the change would only last for the duration of one tax year but President Biden has reportedly stated that he is in favour of making the change permanent.
The increase is considerably higher than the $2,000 currently on offer and would be open to more of the lowest earning households the credit was made fully refundable. The payment method is also tweaked to make it more like the stimulus checks, with a monthly direct debit of up to $300 going out to eligible Americans.
Don’t Miss: How To Apply For Inmate Stimulus Check
Bony Coulanges Third Stimulus Package Update
Well, it doesnt look as if the minimum wage increase is happening.
But all kinds of other interesting nuggets are inside the Senate version of the third stimulus package, the American Rescue Plan .
Now, portions of unemployment are NOT taxable the actual stimulus payments have a very steep phaseout and lots of other goodies in there.
Nothing is final yet, and Ill have more details once it is, but I *do* have a quick word of advice:
If your 2020 AGI is higher than your 2019, AND it might take you over the threshold, it is a very good idea to wait before filing your 2020 taxes. Current Mercer County clients, were already on top of this for you but this would be a very good thing to share with any Mercer County friends of yours who do not regularly read this blog.
And, if any of them want to talk with us, were right here:https://acxtax.setmore.com/
More to come from me on all of this once the actual legislation is signed. As of this writing, the Senate version of the third stimulus package has been sent back to the House to get the differences ironed into something final that will go to Bidens desk for a signature.
And were on top of all of this for you, so rest easy.
But shifting gears a little, I did want to offer you a thought today.
Bony Coulanges Third Stimulus Package UpdateA business has to be involving, it has to be fun, and it has to exercise your creative instincts. Richard Branson
And that will beat brand-building every time.
Warmly,
When Could The Stimulus Payments Start
Following approval of the bill on March 11th, millions of Americans will start seeing the third stimulus payments by mid-to-late March 2021 per the estimated IRS payment schedule and official Biden administration guidance. Comments below confirm these are going out now. You can also check the IRS Get May Payment tool for the latest status of your payment. See payment FAQs from the second round of payments, which will also apply for the most part this time around.
Due to the fact that payments are going out in the middle of tax season it may be very hard to get a hold of someone in the IRS to help with payment issues and you will likely have to wait until after April 15th to follow up on issues.
Recommended Reading: Govt Stimulus Chase 30 Day Overdraft Assistance
Democrats In Us House Introduce Wide
Three Democratic lawmakers in the US House of Representatives unveiled a wide-ranging climate bill on Tuesday that embraces President Joe Biden’s goals to curb climate change including decarbonizing the electric grid by 2035.
Introduced by Representatives Frank Pallone, Paul Tonko and Bobby Rush, and incorporating input from the Biden administration, the bill includes a federal clean electricity standard requiring a percentage of retail power sales to come from sources that produce little or no carbon emissions.
The Climate Leadership and Environmental Action for our Nation’s Future Act, or CLEAN, requires 80% clean electricity by 2030 and 100% by 2035.
The power could come from sources including wind, solar and existing nuclear energy. That could provide a boost to nuclear power, an industry experiencing shutdowns amid low prices for natural gas, a competing fuel.
The bill also sets a goal of a fully decarbonized economy by 2050. On transportation, the largest source of carbon emissions, the bill authorizes $100 million annually from fiscal 2022 to 2031 for entities that install publicly accessible electric vehicle supply equipment. It also requires the energy secretary to establish a program to help determine where EV charging stations are needed and expands EV access in disadvantaged communities.
A Couple Of Ideas For Where To Find Money For Stimulus
Robert Reich, who was Labor Secretary under Bill Clinton, has a few ideas of where to find funding for the covid-19 relief bill working its way through Congress. One of the measures, a wealth tax, was introduced by Sen. Elizabeth Warren, Rep. Pramila Jayapal and Rep. Brendan Boyle on Tuesday.
It would levy a 2% annual tax on the net worth of households and trusts between $50 million and $1 billion as well as a 1% annual surtax on assets above $1 billion, for a 3% tax overall on billionaires.
Read Also: Are We Getting A Third Stimulus
Fourth Stimulus Check Amount
The fourth stimulus check amount depends on several factors. If passed, it would probably look similar to the previous checks, although that’s not guaranteed.
For reference, the first stimulus check amounted to as much as $1,200, while the second stimulus check brought $600 to eligible Americans. The third stimulus check, which the IRS is still in the process of distributing, is worth up to $1,400 per person, although the eligibility requirements are narrower.
All three checks gave the full amounts to taxpayers who made up to $75,000 a year, according to their most recent tax returns. Couples filing jointly got the full payment if they had a joint total income of $150,000 or less.
With the first two checks, those making up to $99,000 alone or $198,000 as a couple received prorated payments. With the third check, individuals who earned more than $80,000 per year or $160,000 per year as joint filers got nothing. Our guide to the stimulus check calculator can show you what your own eligibility looks like.
Schumer Announces That Senate Will Debate Stimulus
Once the bill is formally on introduced on the floor, the Senate will debate for 20 hours. In that time Senators will be allowed to present amendments to the $1.9 trillion covid-19 relief bill.
Senator Bernie Sanders announced on Monday that he plans to introduce one on raising the minimum wage to $15 per hour. Although it passed the House it was dropped to assure quicker passage of the bill.
Republicans are getting set to make the vote-a-rama even more of a marathon. GOP lawmakers plan to delay the final vote on the legislation by adding poison pill amendments.
Don’t Miss: Can I Claim Stimulus Check On 2020 Tax Return
When Will You Get The Third Stimulus Check
Officials at the Treasury Department and Internal Revenue Service said Friday that processing of the new round of stimulus payments has already begun, with the aim of having the first payments start showing up in bank accounts this weekend.
The IRS said Friday that additional waves of payments will be sent in the coming weeks by direct deposit and through the mail as a check or debit card. The agency added that contacting the IRS or your financial institutions wont get you your check any sooner.
A date has yet to be set for when those receiving Social Security and other federal beneficiaries will get their money. Though the IRS said those Americans will generally receive the third payment the same way as their regular benefits.
Also Check: Wells Fargo Stimulus Check Not Pending
Raymond Sawyers Third Stimulus Package Update
Well, it doesnt look as if the minimum wage increase is happening.
But all kinds of other interesting nuggets are inside the Senate version of the third stimulus package, the American Rescue Plan .
Now, portions of unemployment are NOT taxable the actual stimulus payments have a very steep phaseout and lots of other goodies in there.
Nothing is final yet, and Ill have more details once it is, but I *do* have a quick word of advice:
If your 2020 AGI is higher than your 2019, AND it might take you over the threshold, it is a very good idea to wait before filing your 2020 taxes. Current Orange County clients, were already on top of this for you but this would be a very good thing to share with any Orange County friends of yours who do not regularly read this blog.
And, if any of them want to talk with us, were right here:https://login2.atomanager.com/atom_SOS/default.aspx?redirect=webinfoNewClientAppointment.aspx
More to come from me on all of this once the actual legislation is signed. As of this writing, the Senate version of the third stimulus package has been sent back to the House to get the differences ironed into something final that will go to Bidens desk for a signature.
And were on top of all of this for you, so rest easy.
But shifting gears a little, I did want to offer you a thought today.
Raymond Sawyers Third Stimulus Package UpdateA business has to be involving, it has to be fun, and it has to exercise your creative instincts. Richard Branson
Also Check: How Much Is Our Next Stimulus Check
Will The Irs Tax My Third Stimulus Check
The IRS does not consider stimulus checks to be taxable income. This means that you do not have to report the money on your federal income tax return, or pay income taxes on your stimulus check.
You should also note, that if you owe taxes, you could still qualify to get a stimulus payment because the IRS does not use it to offset federal or state tax debts like it normally does with tax refunds.
For private debts, however, the American Bankers Association has pointed out a loophole in the new stimulus plan where banks and other financial services providers will be legally required to comply with court ordered garnishments. The association says that without legislation to shield your third stimulus payment, creditors or collectors can take it to pay off existing debt.
As a reference, the 2020 COVID-Related Tax Relief Act did shield stimulus payments from private debt collection: The Advance payments are generally not subject to administrative offset for past due federal or state debts. In addition, the payments are protected from bank garnishment or levy by private creditors or debt collectors.
But while your stimulus money could be taken to pay for private debt, the new offsetting rules prevent the IRS from deducting overdue child support from eligible recipients. You should keep in mind, however, that the IRS intercepted or reduced payment from the first round of stimulus checks for past-due child support.
Despite Covid Pandemic Us Manufacturing Activity Hits Three
US manufacturing activity increased to a three-year high in February amid a surge in new orders, but factories continued to face higher costs for raw materials and other inputs as the pandemic drags on.
The acceleration reported by the Institute for Supply Management on Monday was despite a global semiconductor chip shortage, which has hurt production at automobile plants.
It was the latest indication of strong economic performance early in the first quarter, thanks to nearly $900 billion in additional covid-19 relief money from the government and a drop in new coronavirus infections and hospitalizations.
“Manufacturing is doing well but it will not be smooth sailing over the next few months because of supply-chain disruptions, slow delivery times and a global shortage of semiconductors,” said Ryan Sweet, a senior economist at Moody’s Analytics in West Chester, Pennsylvania.
Read Also: When Will I Get My Third Stimulus Check Direct Deposit
Third Stimulus Check In 2021 Under Biden Covid Relief Package
Under the now passed $1.9 Trillion Biden COVID Relief Package there are provisions included for another round of stimulus checks. The amounts will be $2800 for couples, $1400 for single adults and $1400 for each eligible dependent per the final bill crafted by the Congressional Democrats.
Based on the income qualification levels, nearly 85 percent of American households would receive a full or partial stimulus payment under the Biden plan. A typical couple with two children making $100,000 annually would receiving about $5,600 with this third round of stimulus check payments.
The full payment will be made to singles filers making less than $75,000 and couples earning less than $150,000 in adjusted gross income . Phase out limits to get a partial stimulus payment are also shown in the table below. To get the dependent check you need to qualify for the adult stimulus payment, and the payment would be sent to the adult recipient claiming the dependent.
| 2019 or 2020 Tax Filing Status | Income Below Which FULL Stimulus is Paid | Maximum Income To Qualify for Partial Stimulus |
|---|---|---|
| Single or Married filing separate | $75,000 |
Extended Unemployment Benefits$300 A Week Until September
The package will extend a $300-per-week federal unemployment supplement through Sept. 6. The first $10,200 of unemployment benefits received in 2020 will be tax-free for individuals with adjusted gross incomes below $150,000. If you qualify for the tax-free benefit and you already filed taxes for 2020, you will likely need to file an amended return.
In addition, the bill will extend pandemic unemployment assistance for self-employed people and gig workers, and extend the length of time people can claim unemployment benefits. People who have exhausted their state unemployment benefits will get an extension through Sept. 6.
Calculator: How Much Unemployment Could You Receive In Your State?
The amount and length of additional unemployment support has been a key point of debate for this round of stimulus legislation. The extension of benefits signed by former President Donald Trump in late December were set to expire in March. Legislators strategized that another stimulus in March would be essential to minimize a looming gap in benefits for people who are out of work due to the pandemics effect on the economy.
Also Check: When Are We Getting Second Stimulus Check
Biden Withdraws Tanden’s Nomination To Be White House Budget Chief
The White House has withdrawn the nomination of Neera Tanden to head its budget office, bowing to political reality as her selection ran into stiff opposition over tweets that upset lawmakers.
“I have accepted Neera Tandens request to withdraw her name from nomination for director of the Office of Management and Budget,” President Joe Biden said in a short statement.
Biden said, however, that he planned to have her serve in his administration in some capacity.
In a letter to the president released by the White House, Tanden acknowledged her nomination had become more than an uphill climb.
“Unfortunately, it now seems clear that there is no path forward to gain confirmation, and I do not want continued consideration of my nomination to be a distraction from your other priorities,” Tanden said.
Who Gets $1400 Stimulus Checks
The House and Senate versions of the bill agreed that individual tax filers making up to $75,000 per year will get $1,400. Couples, who file jointly, making up to $150,000 will get $2,800. There will also be $1,400 tacked on for each dependent in the household.
Where they differed was how quickly the stimulus money would be phased out to zero. The original House bill passed on Feb. 27 called for the phase out to be complete at $100,000 for individuals and $200,000 for couples. But the Senate version passed on March 6 lowered it to $80,000 and $160,000, respectively. That Senate version is what the House passed on Wednesday.
Roughly 8 million fewer households will get a check under the Senate bill compared with what the House passed, according to an analysis from the Tax Policy Center.
RELATED: Biden won’t be putting his name on stimulus checks, White House says
You May Like: Is There A Fourth Stimulus