The government has approved a third round of stimulus check payments in an effort to help individuals and businesses recover from the impact of the pandemic. Millions of Americans will receive checks, while others will not due to the new guidelines regarding who does (and does not) qualify. Have questions about the new stimulus payments? Here are the answer to some frequently asked questions.
Who Will Receive Payments?
Eligibility for the new stimulus payments is based on the income your reported on your 2019 and 2020 tax returns. If are single, you will not receive a payment if you reported making over $80,000 per year. If you are married and filing jointly, you will not receive a payment if you collectively report over $160,000 per year. Those who claim head-of-household status on their tax returns will not receive a check if they make more than $120,000. Those who can be claimed as a dependent on someone else’s tax return also won’t receive a payment, even if they are not actually claimed.
How Do I Know if I’m Getting a Payment?
If you’re not sure if you qualify for a stimulus payment, you can check your status by logging in to the IRS tracker. By entering your name, social security number, and mailing address, you can find out if you will get a check and when your check is deposited.
How Much Will My Payment Be?
The base payment is $1400 per eligible individual and $2800 for eligible couples who file jointly. For each eligible dependent, you will get an additional $1400. Children who were born in 2021 will not be eligible for a payment as they were not claimed on your 2020 tax return.
Payments begin phasing out a certain income level, and phase out altogether once you hit the upper limits described above. If you’re single, the phase-out will start at an income level of $75,000. Those married and filing jointly will have a phase-out starting at $150,000. Head-of-household filers will have their payments start phasing at $112,500.
How Will This Affect My Taxes?
The third stimulus payment will not have any effect on your taxes. It is considered an advanced payment on the Recovery Rebate tax credit for 2021 and will not be considered taxable income. You will also not be required to repay this payment when you file your 2021 taxes. If your third stimulus check is less than the 2021 credit, you will actually get the difference back when you file your 2021 return.
When Will I Get My Payment?
The first wave of payments were made on March 13th. If you did not get a payment by March 17th, don’t worry. There will be more rounds of payments and the IRS is not clear on when all of the payments will be sent. Remember, you can track the status of your payment on the IRS tracker website mentioned earlier in this post.
Have more questions about the third stimulus payment? Feel free to reach out to our experienced financial professionals at Hayes & Association or work with your personal accountant to find out more.