Economic Impact Payments | Round Three
The American Rescue Plan Act of 2021 issues the third round of Economic Impact Payment. Here’s what we know:
How will the IRS determine my eligibility?
For those who have filed for 2020, the IRS will determine your eligibility and size of payment based off of this return. Those who haven't filed yet will have their eligibility based off of their 2019 tax return. This also includes those that used the "non-filer portal" on the IRS website for previous direct payments.
The income levels for this third round of stimulus payments is different than the previous two, which means that some people who were eligible for the first or second payment may not be receive the third.
How Do I claim my payment?
If you have already received the first or second stimulus, you most likely will not have to take any action to receive the third. For those who didn’t receive the previous payments and have yet to file a tax return in 2019 or 2020, you will need to file a 2020 tax return. If you are eligible for the three stimulus payments, you can claim the Recovery Rebate Credit.
How much is the payment?
Like previous Economic Impact Payments, those under a certain AGI level will receive the full payment until the payments phase out above a certain AGI, depending on your filing status.
| Filing Status | $1,400 | Varies | Not Eligible |
|---|---|---|---|
| Single and Married Filing Seperately | AGI does not exceed $75,000 | AGI is between $75,000 - $80,00 | AGI exceeds $80,000 |
| Head of Household | AGI does not exceed $112,500 | AGI is between $112,500 - $120,000 | AGI exceeds $120,00 |
| Married Filing Joint or Qualifying Widow | AGI does not exceed $150,000 | AGI is between $150,000 - $160,000 | AGI exceeds $160,000 |
Taxpayers will also receive $1,400 for each qualifying dependent on their tax return. This payment is not restricted to children under 17 like the previous two payments. This means that older dependents such as college students, adults with disabilities, parents, and grandparents will be eligible as a qualifying dependent.
How will I receive my payment?
Direct Deposit: Those who filed using direct deposit for their 2019 or 2020 tax return or provided information via the non-filer portal will receive the payment to the same account they provided to the IRS.
Check: If you don’t have current direct deposit information on file with the IRS, you will most likely receive a check that will be mailed to your most recent address on file.
Prepaid Card (EIP Card): In some instances, individuals may receive a prepaid debit card in the mail. Payments will not be added to an existing EIP card that was mailed for the first or second round of stimulus payments. Those expecting a payment via mail should watch out carefully. The payment will arrive white envelope prominently displaying the U.S. Department of Treasury with a Visa card inside with your name. For more information on the card, visit https://www.eipcard.com/.
Social Security retirement, survivor or disability benefits (SSDI), Railroad Retirement benefits, Supplemental Security Income (SSI) or Veterans Affairs Beneficiaries: Payments will be deposited in the same way as regular benefits.
When will I receive my payment?
Payments have already started going out, but the official payment date for direct deposit is March 17. To check the status of your stimulus payment, visit www.IRS.gov/getmypayment.
If you don’t receive your stimulus payment in this first batch, additional batches will be sent out in the coming weeks by direct deposit or through the mail as a check or debit card.
Still Need to File for 2020?
If you still need to file for 2020 to claim the Rebate Recovery Credit, we can help! Give us a call at (360) 922-0235 to schedule an appointment with an experienced tax preparer.
Disclaimer: This material is prepared for informational purposes only, and is not tax advice. Please speak with a tax professional or visit the additional resources below to see how this information may apply to you.
