Bad Credit Credit Cards – Bad Credit Credit Cards – Bad Credit Credit Cards – Your Third Stimulus Check: How Much? When? And Other FAQs | Fintech Zoom | Fintech Zoom

   2021-03-13 09:03

Bad Credit Credit Cards – Bad Credit Credit Cards – Bad Credit Credit Cards – Your Third Stimulus Check: How Much? When? And Other FAQs | Fintech Zoom | Fintech Zoom

Bad Credit Credit Cards – Bad Credit Credit Cards – Your Third Stimulus Check: How Much? When? And Other FAQs | Fintech Zoom



Bad Credit Credit Cards – Your Third Stimulus Check: How Much? When? And Other FAQs

A third stimulus check is finally on its way! After weeks of back-and-forth and waiting, Congress passed a new stimulus package that includes a third round of stimulus checks (the American Rescue Plan Act of 2021), and President Biden signed the bill on March 11. But, since several different amounts and restrictions were thrown around during the negotiations, Americans still have a lot of questions about their third stimulus checks. At the top of the list: How much will I get? And when will I get it?

Fortunately, we have answers to these and other frequently asked questions about your third stimulus check. We also have a nifty Third Stimulus Check Calculator that tells you how much money you should get (everyone’s payment will be different). Read on to get the answers you need to the questions you have. Once you know more about your third stimulus check, you can start figuring out how you can use the money to your advantage.

(Stay on top of all the new stimulus bill developments – Sign up for the Kiplinger Today E-Newsletter. It’s FREE!)

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Amount of Third Stimulus Checks

Question: How much money will I get?

Answer: Everyone wants to know how much money they will get. You probably heard that your third stimulus check will be for $1,400 — but it’s not that simple. That’s just the base amount. Your check could actually be much higher or lower.

To calculate the amount of your check, Uncle Sam will start with that $1,400 figure. If you’re married and file a joint tax return, then both you and your spouse will get $1,400 (for a total of $2,800). If you have dependents, you get an additional $1,400 for of them. So, for example, a married couple with two children can get up to $5,600.

Now the bad news. Stimulus payment amounts will be phased-out for people at certain income levels. Your check will be gradually reduced to zero if you’re single with an adjusted gross income (AGI) above $75,000. If you’re married and file a joint tax return, the amount of your stimulus check will drop if your AGI exceeds $150,000. If you claim the head-of-household filing status on your tax return, your payment will be reduced if your AGI tops $112,500. You won’t get any payment at all if your AGI is above $80,000 (singles), $120,000 (head-of-household), or $160,000 (joint filers).

Also note that the IRS, which will issue the payments, will look at either your 2019 or 2020 tax return for your filing status, AGI, and information about your dependents. Because of this, the amount of your third stimulus check could change depending on whether you file your 2020 tax return now or wait until later to file (see Increase Your Third Stimulus Check By Filing Your Tax Return Now (or Later) for details).

Again, we have an easy-to-use Third Stimulus Check Calculator to help you figure out the estimated amount of your check (based on your 2019 or 2020 return). Check it out!

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Taxation of Third Stimulus Checks

Question: Will my third stimulus check be taxed later?

Answer: No. As with the first two rounds of payments, your third stimulus check is actually just an advanced payment of the Recovery Rebate tax credit for the 2021 tax year. As such, it won’t be included in your taxable income.

You also won’t be required to repay any stimulus check payment when filing your 2021 tax return — even if your third stimulus check is greater than your 2021 credit. If your third stimulus check is less than your 2021 credit, you’ll get the difference when you file your 2021 return next year. So, it’s a win-win situation for you!

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Timing of Third Stimulus Checks

picture of March 2021 calendar

Question: When will I get my third stimulus check?

Answer: Soon! President Biden said third stimulus checks will start going “out the door” in March. But White House Press Secretary Jen Psaki said that the first wave of payments could be sent as early as the March 13-14 weekend, with more payments in the following weeks.

How long it will take to send all payments is not known yet. The IRS has a lot on its plate right now. Tax return filing season is already underway, so the IRS is busy processing tax returns – which could very well slow down the processing of sending out stimulus checks.

If the IRS already has your bank account information — either from a recent tax payment that you made or from a tax refund it sent you — then expect to get your third stimulus check faster. That’s because the IRS will be able to directly deposit the payment into your bank account. The IRS can also make a third stimulus payment to a Direct Express debit card account, a U.S. Debit Card account, or other Treasury-sponsored account. Otherwise, you’ll get a paper check in the mail.

If you already have a prepaid debit card from the IRS (e.g., for a first- or second-round stimulus check), you will get a new card if the IRS decides to send your third stimulus payment to you in that form. (But just because you received a debit card for an earlier stimulus payment doesn’t mean you’ll automatically get one for the third payment.)

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People Who Don’t File a Tax Return

picture of crumpled tax form being thrown away

Question: What if I don’t file a 2019 or 2020 tax return?

Answer: Some people don’t file a tax return because their income doesn’t reach the filing requirement threshold. If that’s the case, the IRS will send a third stimulus check based on whatever information, if any, is available to it. That information potentially could come from the Social Security Administration, Railroad Retirement Board, or Veterans Administration if you’re currently receiving benefits from one of those federal agencies. (Note that, if your third stimulus check ends up being paid to a representative payee or fiduciary, the entire payment can only be used for your benefit.) If you supplied the IRS information last year through its online Non-Filers tool, the tax agency can use that information, too.

If the IRS can’t gather enough information about you to send you a third stimulus check, you won’t lose out on the money — you’ll just have to wait until next year to claim it. As we already noted, the checks that will be sent now are really just advanced payments of a 2021 tax credit. So, if the IRS doesn’t send you a third stimulus check, you can claim it as a refund or reduction of the tax you owe when you file a 2021 tax return (you can file a return just to claim the payment). You’ll have to file your return, or request an extension, by April 18, 2022.

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Children Born in 2021

picture of man feeding a baby

Question: What if I had a child in 2021?

Answer: Unfortunately, if you had a child in 2021, you won’t get an additional $1,400 in your third stimulus check for him or her. That’s because your new bundle of joy wasn’t claimed as a dependent on your 2019 or 2020 tax return. You can, however, get an additional $1,400 Recovery Rebate credit for your new baby on your 2021 tax return.

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College Students and Young Adults Living at Home

picture of college students in class

Question: Will college students and young adults who live with their parents get a third stimulus check?

Answer: Anyone who can be claimed as a dependent on someone else’s tax return (whether or not they’re actually claimed as a dependent) won’t receive a third stimulus check. That means no payments to children living at home who are 17 or 18 years old, or to college students who are 23 or younger at the end of the year who don’t pay at least half of their own expenses. Other dependents won’t receive stimulus payments, either. For example, an elderly parent living with you is out of luck and won’t get a check.

However, unlike with the first- and second-round payments, the person claiming the college student or young adults as a dependent – typically their parents – will get an extra $1,400 per dependent tacked on to their third stimulus check. For the first two stimulus checks, the additional amount was only allowed for dependent children 16 years old or younger. But the American Rescue Plan allows the extra payment for any dependents – regardless of their age. (That also means adult children caring for their elderly parents can get the additional payment if they can claim their parents as dependents.)

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Seniors Living with an Adult Child

picture of adult woman feeding her elderly mother

Question: Will seniors who live with an adult child get a third stimulus check?

Answer: Again, anyone who can be claimed as a dependent on someone else’s tax return doesn’t qualify for a third stimulus check. So, elderly people living with an adult child won’t get a check if they can be claimed as a dependent on their child’s tax return.

However, as with college students and young adults living with their parents, an adult child supporting an elderly parent will get an extra $1,400 added on to his or her third stimulus check if the elderly parent is a dependent. Again, the age of the dependent doesn’t matter for third-round stimulus checks like it did with earlier stimulus payments.

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Nonresident Aliens

picture of a pencil on an immigration form

Question: Will “nonresident aliens” get a third stimulus check?

Answer: Nonresident aliens are not eligible to receive a third stimulus check. Generally, you’re considered a nonresident alien if you’re not a U.S. citizen, you don’t have a green card, and you’re not physically present in the U.S. for the required amount of time. For more information on nonresident alien status, see IRS Publication 519.

(Trusts and estates aren’t eligible for third stimulus checks, either.)

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Social Security Numbers

picture of Social Security cards

Question: Do I have to have a Social Security number to get a third stimulus check?

Answer: In most cases, you must have a Social Security number to receive a third stimulus check. Generally, your spouse and any dependent you’re receiving an extra $1,400 for must also have a social security number. An individual taxpayer identification number (ITIN) is not good enough.

There are a few exceptions to this rule:

  • An adopted dependent can have an adoption taxpayer identification number (ATIN) instead of a Social Security number;
  • For married members of the U.S. armed forces, only one spouse needs to have a Social Security number; and
  • If your spouse doesn’t have a Social Security number, you can still receive a third stimulus check if you have a Social Security number.

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Back Taxes, Child Support and Other Debts

picture of dictionary focusing on definition of "child support"

Question: Can the IRS or other creditors take my third stimulus check if I owe back taxes, child support or other debts?

Answer: Your third stimulus check is not subject to reduction or offset to pay child support, federal taxes, state income taxes, debts owed to federal agencies, or unemployment compensation debts. (If you owed child support, the IRS could use first-round stimulus check money to pay arrears.)

However, the American Rescue Plan doesn’t include additional protections that were included in the legislation authorizing the second round of stimulus checks. For example, second-round stimulus checks weren’t subject to garnishment by creditors or debt collectors. They couldn’t be lost in bankruptcy proceedings, either. The IRS also had to encode direct deposit payments so that banks knew they couldn’t be garnished.

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Dead People

picture of widow looking at picture of her late husband

Question: Can a dead person get a third stimulus check?

Answer: For the third round of stimulus checks, anyone who died before January 1, 2021, is not eligible to receive a payment. Essentially, they’re treated as if they don’t have a Social Security number.

There is an exception for military personnel. If a person who died before 2021 was married and a member of the U.S. military, the surviving spouse can still receive a third stimulus check even if he or she doesn’t have a Social Security number.

The extra $1,400 per dependent is also off the table if the parent died before 2021 or, in the case of a joint return, both parents died before then.

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Inmates

picture of man in county jail

Question: Can a person in jail or prison get a third stimulus check?

Answer: Yes. There’s nothing in the American Rescue Plan that prevents incarcerated people from receiving a third stimulus check. If they’re otherwise eligible, they’ll receive a stimulus check or will be able to claim a Recovery Rebate credit like anyone else.

There was nothing in the CARES Act to prevent first-round checks to inmates, either. However, the IRS initially deemed them ineligible for a payment. That decision was challenged in court…and the IRS lost.

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Stay on Top of Stimulus-Check Developments

The words stimulus plan on paper atop U.S. currency

Follow Kiplinger for the latest news and insights on federal stimulus payments (and other important personal-finance matters). Stay with us on:

See some of our other coverage of the third stimulus check:

Bad Credit Credit Cards – Your Third Stimulus Check: How Much? When? And Other FAQs

Bad Credit Credit Cards – Bad Credit Credit Cards – Your Third Stimulus Check: How Much? When? And Other FAQs | Fintech Zoom

Bad Credit Credit Cards – Bad Credit Credit Cards – Bad Credit Credit Cards – Your Third Stimulus Check: How Much? When? And Other FAQs | Fintech Zoom | Fintech Zoom


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