President Joe Biden signed a new $ 1.9 trillion coronavirus bill Thursday, which means $ 1,400 in stimulus checks could reach Americans in the coming days.
The payments should go to around 159 million households.
“People can expect direct deposits to be made into their bank accounts this weekend,” said Jen Psaki, White House press secretary, on Thursday.
“Payments to eligible Americans will continue over the next few weeks,” she said.
Checks are limited to a maximum of $ 1,400 per person or $ 2,800 per couple plus $ 1,400 per dependent.
As with previous direct payments, this third round will be based on income.
The income limits for those who receive the maximum amount remain the same. Individuals earning an adjusted gross income of up to $ 75,000, heads of household up to $ 112,500, and married couples filing up to $ 150,000 together will receive the full $ 1,400 per person.
However, this time the crowd drains faster. Payments are capped at $ 80,000 per person, $ 120,000 for heads of household, and $ 160,000 for married couples. Individuals with an adjusted gross income and above do not receive anything.
As a result, fewer people will receive reduced payments this time around.
“The last time you got a full payment, this time you will get the full payment,” said Steve Wamhoff, director of federal tax policy at the Institute for Taxes and Economic Policy, provided your income has not changed materially.
The checks, valued at $ 1,400, are typically based on tax returns for 2020 or 2019, depending on the most recent filings processed by the IRS.
The government will also send payments to any non-registrants it has registered.
Here’s a breakdown of who may or may not get cash this time around.
Payments of $ 1,400 also go to eligible dependents. This time also for people aged 17 and over.
The money will be sent to the adults who have claimed the relatives.
Mixed status households
As with previous checks, individuals need a valid Social Security number to qualify.
So if you are filing your taxes using an Individual Tax Identification Number (ITIN) you will not be eligible.
For married couples where one spouse has a social security number and one spouse has an ITIN, only the spouse with the social security number receives payment. Your children are also qualified, provided they have valid social security numbers.
“There were a lot of people who thought we should just give the checks to everyone,” said Wamhoff. “This legislation takes an intermediate approach.”
President Joe Biden signs the American rescue plan in the Oval Office of the White House in Washington, DC on March 11, 2021.
Almond Ngan | AFP | Getty Images
Individuals who were alive on January 1st will qualify.
People with unpaid debts
Individuals with unpaid personal debt – other than outstanding child child support payments or tax debts – could be at risk of their stimulus checks being garnished.
This is due to the fact that lawmakers used a budget reconciliation process to pass the coronavirus relief package, which limited its ability to prevent seizure of payments. However, banking and consumer trade groups have called for a follow-up to change this.
If you miss this year
If you don’t get a $ 1,400 payment or a reduced check, but your income changes, you might be able to claim the money due when you file your taxes next year.
“Any change, either a slight reduction in income or just putting more money into a traditional IRA or 401 (k) could result in a much higher total payment when they raise their taxes for 2021,” said Garrett Watson, senior policy analyst at the tax foundation.
“There is a subset of people who will be in this situation,” said Watson.
This also applies to this year’s tax return for anyone who missed previous payments of $ 1,200 or $ 600. You can request a refund credit to recover any money owed. This also applies to people who normally do not file tax returns because their income is too low.
The IRS website provides information on free filing tools.