On Thursday, March 11th, President Joe Biden signed The American Rescue Plan into law almost a year to the day when it was acknowledged that Covid-19 had hit the USA, and it was deadly!
This is the 3rd stimulus program since the pandemic has begun, and the question on most people’s minds is “Where is My $1,400 Check?” This third round of economic stimulus will be based on the taxpayer’s last processed tax return, from either 2020 or 2019. That includes anyone that used the IRS’s non-filers tool last year or submitted a special simplified tax return. The $1,400 is per adult. The boost to the child tax credit will give eligible parents a total of $3,600 for each child under age 6 and $3,000 for each child under age 18 for 2021. Until now, the credit was up to only $2,000 per child under age 17. For large families who qualify, this can be a windfall!
The US Treasury claims that almost 85% of Americans will qualify, based on income:
- $1,400 for a Single Filer: Individuals earning up to $75,000 AGI (adjusted gross income) would receive $1,400, which would be reduced by 20% for every $1,000 earned between $75,000-$80,000. In other words, someone who earned $76,000 receives $1,120 ($1400-20% or $280) and one earning $77,000 receives $840 etc.
- $2,800 for a Married Couple Filing Jointly: Couples earning up to $150,000 would receive $1400 each but would lose 10% for every $1,000 up to $160,000. Couples (filing jointly) would be ineligible if earning over $160,000.
- $1,400 for Heads of Household: A head of household earning up to $112,500 would qualify for the full amount.
There are different opinions on the new $1.9 Trillion American Rescue Plan as no Republicans voted “yes” in either The Senate or House of Representatives. To give you a frame of reference, our current national debt is roughly $22 Trillion, meaning we are printing up to 9% of our national debt in new paper. In 2020, we increased the money supply by 24% with the two 2020 stimulus payment packages.
This recovery package is designed for our country to bounce back with money set aside for the child tax credit, small businesses, restaurants, closed venues, extended unemployment, and state and local governments, to name a few. Only 9% of the $1.9T is going directly to Covid-19 relief.
HERE ARE MY 4 TIPS ON HOW TO MONITOR RECEIVING YOUR PAYMENT AND IN WHAT FASHION IT WILL BE RECEIVED:
- Complete Your 2020 Tax Return As SOON As Possible: If you earned more money in 2019 than 2020, the $1,400 check qualification is based on your 2019 return unless you get your 2020 tax return processed as soon as possible.
- Consult Your CPA or Enrolled Agent: If you did not receive the last stimulus check and should have qualified, you can pick it up as a discount on your 2020 tax return.
- Get Familiar with the IRS Website www.IRS.gov: The IRS has updated their website with their “GET MY PAYMENT TOOL.” You can go to www.IRS.gov/coronavirus/get-my-payment. The “get my payment” button requires you to input your full social security number/tax ID, date of birth, street address and zip code. This tool will be updated only once/day, usually overnight.
- Be Patient and on the Lookout: For those that received the first 2 stimulus checks and did NOT receive the checks by direct deposit, The Treasury will be mailing you a check or debit card. Both Chase Bank and Wells Fargo are already having delays. These types of payments are sent out in groups called “Tranches.” If your address has changed, the easiest way to update it is to file your 2020 tax return with your new address. Stimulus payments will be sent out through the mail as a check, debit card or via direct deposit, if you are already set up.
In the coming weeks, more “Tranches” (batches) of payments will be sent via direct deposit, or through the mail as a check or debit card. Some people have cut their stimulus debit cards thinking it was a sales promotion.
Stay Positive, Test Negative and Keep the Faith!