The third and biggest round of economic stimulus payments will start to hit taxpayers direct deposit … [+]
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The Internal Revenue Service announced today that it will begin delivering Round 3 economic stimulus payments this weekend. The $1,400 per person economic impact payments were part of the $1.9 trillion Covid-relief stimulus package President Joe Biden signed into law yesterday.
The first batch of payments will be sent by direct deposit and taxpayers will start receiving them as early as this weekend. More will arrive this coming week, with additional batches sent in the coming week by direct deposit and through the mail as a check or debit card, the IRS says. Some 158.5 million households are expected to get payments.
The payments are automatic, so you don’t have to do anything. In many cases, taxpayers will get them the same way they got their first and second round payments. ”The payments will be delivered automatically to taxpayers even as the IRS continues delivering regular tax refunds,” said IRS Commissioner Charles Rettig.
On Monday, the Get My Payment tool on the IRS website will show the status of your payment. You’ll need to enter your social security number, date of birth, street address and zip code. If you’re looking for information about your Round 1 and Round 2 payments, which you’ll need for filing your 2020 tax return, you’ll need to open an IRS online account.
The third round payments will be based on taxpayers’ income on their latest processed tax return from either 2020 or 2019. The income limits were lowered this round: Single taxpayers with adjusted gross income up to $75,000 and married taxpayers fling jointly with adjusted gross income up to $150,000 get a full $1,400 (you get a partial payment with income up to $80,000/$160,000). Another change: This time around dependents can get the full $1,400 payments too. So a family of four could get $5,600 in Round 3 stimulus payments.
The stimulus package also include subsidies to health insurance bought on the marketplace through 2022, and subsidies for laid off workers to stay on their employer-based plan via COBRA with the government paying 100% of premiums. The value of that benefit could eclipse the value of the stimulus payments for some families.
The IRS says it will provide payments to those who used the non-filers tool, or submitted a special simplified tax return, to get last year’s payments. The IRS will also send automatic payments to those who didn’t file a return but get Social Security survivor or disability benefits, railroad retirement benefits, supplemental security income or veteran’s affairs benefits. This is good news because these groups didn’t get payments at the start in the last rounds.
There are still some folks who were eligible for Round 1 and Round 2 payments who must file a 2020 tax return to get the money they’re due as a recovery rebate credit. In those cases, the credit can be offset by back taxes. The National Taxpayer Advocate called on the IRS to deliver full payments but there hasn’t been any concession.
This time around, the IRS says that by law, third round payments cannot be offset to pay back taxes.
Some taxpayers—students who are newly independent, parents of newborns, and retirees—who didn’t get Round 1 and Round 2 stimulus payments are getting a surprise recovery rebate credit on their 2020 tax returns. And they’re finding out that they’re in line for Round 3 too. See Rich Retirees Get Tax Time Surprise: 3 Stimulus Payments.