Third Round of Stimulus ChecksUpdated: January 3, 2023
An economic stimulus is a government policy designed to encourage economic activity. Such attempts can include alterations to federal fiscal policies, quantitative easing, which is defined by some as a form of investment the government makes in certain critical bond markets and/or other areas for a certain span of time to stabilize the economy.
There may also be direct payments to corporations or individuals designed to encourage spending, as was the recent strategy during the Covid-19 pandemic.
Government Stimulus Checks
There have been three stimulus checks mailed to U.S. citizens related to Covid-19 pandemic economic relief. More than 320,000 payments valued at $450 million last spring went to U.S. Department of Veterans Affairs (VA) Compensation and Pension (C&P) beneficiaries who don’t normally file tax returns and didn’t use the Internal Revenue Service’s non-filers tool last year.
The U.S. Department of Treasury and the IRS issued the three Economic Impact Payments or stimulus checks for people who were eligible:
- $1,200 in April 2020
- $600 in December 2020 and January 2021
- $1,400 in March 2021
The payments were sent by direct deposit to financial institution (bank or credit union) accounts or by mail as a paper check or debit card.
Third Stimulus Check
The third round of stimulus checks was approved when the American Rescue Plan Act was signed into law by President Joe Biden on March 11, 2021.
The new round of stimulus checks contains income restrictions to target the new financial relief to lower-income Americans and there are “cut-off” income caps that disqualify certain individuals and households from receiving a third check (see below).
Details Of The Third Stimulus Check
Previous stimulus efforts included income caps. However, in the two prior rounds, you could still get partial payment with dependents, even if you exceeded the cap. In the third round, if you exceed the income cap, you didn’t qualify for a payment.
The third round included considerations for people who are:
- Social Security Disability Insurance (SSDI) recipients
- Non-U.S. citizens
- U.S. citizens who live overseas
- Families with mixed-status citizenship
Eligibility for future rounds, if any, may vary. Potential recipients will want to contact the Internal Revenue Service or their nearest Social Security Administration office for advice and help, especially if they are currently receiving Supplemental Security Income (SSI), SSDI or other benefits.
When Did Third Stimulus Checks Arrive?
Many federal beneficiaries who filed 2019 or 2020 tax returns or used the IRS’ non-filers tool in 2020 were issued Economic Impact Payments.
The majority of Social Security recipients and other federal beneficiaries who do not normally file tax returns received payments electronically April 7. This applied to Social Security, SSI and Railroad Retirement Board (RRB) beneficiaries who did not file 2019 or 2020 tax returns or did not use the non-filers tool.
Some Americans started seeing the money as early as March 17. The IRS took about a week to send the second round of checks, worth $600, in January.
The fifth batch of payments began processing April 9, with an official payment date of April 14. According to the IRS, the batch included:
- About 2 million payments valued at more than $3.4 billion.
- More than 320,000 payments valued at $450 million to VA Compensation and Pension (C&P) beneficiaries who don’t normally file tax returns and didn’t use the non-filers tool last year.
- About 850,000 payments worth nearly $1.6 billion to eligible individuals for whom the IRS did not have information to issue a previous Economic Impact Payments but who recently filed tax returns.
- Additional ongoing supplemental payments for people who received payments based on their 2019 tax returns and are eligible for a new or larger payments based on recently processed 2020 tax returns.
- More than 700,000 plus-up payments valued at more than $1.2 billion
- 72,000 payments to Social Security beneficiaries who didn’t file a 2019 or 2020 tax return and didn’t use the non-filers tool last year.
Overall, this batch of payments contains nearly 1.2 million direct deposit payments (valued at just under $2 billion) and nearly 800,000 paper check payments (valued at more than$1.4 billion).
IRS Get My Payment Tool: The IRS revived its Get My Payment tool to help track the payments.
Who Qualified For The Third Round of $1,400 Stimulus Checks
The $1,400 stimulus is available for single taxpayers who earn less than $75,000 per year. There is an income cap of $112,500 for single taxpayers who file U.S. taxes as head of household.
Those who file taxes as married earners and bring in $150,000 per year or less also qualify.
Those who exceed the caps by a modest amount may qualify for a partial payment, but there are cutoffs.
Third Recovery Rebate Amounts and Qualifiers
- A maximum $1,400 for individual tax filers
- A maximum $2,800 for couples who make up to $160,000;
- Individuals who earn above $75,000 and couples above $150,000 are ineligible for the stimulus
- An additional $1,400 per child.
Third Stimulus Check Phase Outs
- $75,000 in adjusted gross income for singles.
- $112,500 for heads of household.
- $150,000 for married couples (when couples file joint tax returns)
- Payment is reduced 5% or $5 of every dollar above that mark, or $50 for every $1,000 above $75,000.
- Complete phase out at $87,000 for singles and $174,000 for couples (with no dependents).
Stimulus Check Qualification Categories
- VA Benefits: Disabled Veteran, Pension and Survivor Benefits Recipients: VA disability and veterans pension and survivors’ pension beneficiaries are treated the same as those receiving Social Security, SSDI, SSI benefits and qualify for stimulus checks as long as they are not the dependent of another taxpayer
- Medically Retired: Same as disability, veterans pension and survivors’ beneficiaries.
- Active Duty: Service members from all U.S. Armed Forces branches – Army, Marine Corps, Navy, Air Force, Coast Guard and, Space Force –qualify to receive a stimulus check.
- Military Spouse with No Social Security Number: An exception to the Social Security number requirement is if a service member files a married couple tax return; then, their he spouse is not required to have a Social Security number to receive the payment.
- Social Security and SSDI Recipients: Social Security and SSDI payments are eligible for a stimulus check; individuals with no income are eligible as long as they are not the dependent of another taxpayer and have a work-eligible Social Security number; and those with qualifying children can take an additional step to receive $500 per qualifying child.
- Supplemental Security Income (SSI) Recipients: SSI recipients and others whose income comes entirely from non-taxable benefits qualify for and receive them automatically via direct deposit, Direct Express debit card or check with payments expected in early May.
- Social Security Equivalent Benefit (SSEB) Recipients: SSEB beneficiaries who file taxes because they receive additional income through a pension or other source, receive the payment based on their latest tax return
- Railroad Retirement Board (RRB) Beneficiaries: The payment automatically deposited for RRB recipients; for those with qualifying children, they may receive $500 per qualifying child.
- No 2019 or 2020 Tax Returns Filed: Social Security, SSDI and Railroad Retirement recipients do not need to take any action.
- Zero Income: Individuals with no income are eligible as long as they aren’t another taxpayer’s dependent and have a valid Social Security number, but must sign up as a non-filer
- Non-Filers: If your income level does not require you to file a tax return, you must submit information to the IRS to receive a payment as long as you:
- Had gross income not exceeding $12,200 ($24,400 for married couples) for 2020.
- Were not required to file a federal income tax return for 2019 and didn’t plan to.
- Non-Filers with Children who Qualify: Non-filers with children must add $500 per child to their automatic payment of $1,200 if they didn’t file a tax return in 2019 or 2020; to do so, visit the IRS’ non-filers’ payment information page.
- Dependents Older Than Age 17: Parents with college-age students or people who claim elderly people and individuals with disabilities as a dependent may receive up to $1,400 per dependent in the third round
- College Students: Students who are not dependents of their parents qualify; generally, a full-time college student under age 24 is considered a dependent if their parent(s) provide more than half their support
- Babies/Newborns: Parents who had a child in 2020 are eligible for the additional $1,400 per child if their 2020 tax return has not been filed; they receive $1,400 per child added to their 2021 tax refund or subtracted from their 2021 income taxes; and parents of children born in 2021 don’t get a payment for that child now, but $1,400 is added as part of their 2021 tax returns filed in 2022.
- Adopted Children with Adoption Taxpayer Identification Number (ATIN): A child under age 17, if adopted, and has an Adoption Taxpayer Identification Number (ATIN) which may be claimed to receive the $1,400 per child payment.
- Americans Living Abroad: Same income requirements apply and will still need a Social Security number.
- U.S. territories: In general, residents of American Samoa, the Northern Mariana Islands, Guam, Puerto Rico and the U.S. Virgin Islands receive payments; territorial tax authorities disburse payments and you may direct questions to those agencies
- Unemployed/Layoff/Furlough (Temporary Layoff): Unemployed workers and workers laid off are eligible to receive stimulus payments and may also be eligible for an additional $600 weekly benefit provided by the federal government; if your income does not qualify, you may after you file your 2021 taxes because he payment is technically an advance on a tax credit so it will depend on how much you earn
- Self-Employed: As long as a self-employed individual’s AGI does not exceed the threshold, they are eligible for the payment.
- Past Due Debt to a Federal Agency: The IRS is refraining from garnishing stimulus payments to satisfy federal tax debts which include unpaid taxes, Social Security debts, student-loan debt or unpaid child support
Income Determination and Taxes
- Income is determined by a person’s adjusted gross income (AGI); and the recovery rebate checks are non-taxable and are not considered income
- The IRS uses 2019 or 2020 tax return information if already filed
Who Did Not Qualify For Third Stimulus Payments
There are income caps that serve as disqualifications for third stimulus payments:
- $80,000 for single earner
- $120,000 head of household earners
- $160,000 for married earners
Individuals earning between $80,000-$100,000, and couples earning between $160,000-$200,000 are excluded from a partial check.
Those who owe taxes to the IRS may receive no stimulus check or a reduced check. It’s also possible you may fail to receive a check if you owe child support because the money may have been garnished.
Contract the IRS to inquire about the status of your check if you feel it has not arrived in error. You may use the IRS’ tracker tool to check on your payment’s status.
You may need to consult a professional to determine what your tax implications are.
Second Stimulus Checks
The second Economic Impact Payments started getting disbursed Dec. 30, 2020, with an official payment date of Jan. 4, 2021, according to the IRS and Treasury Department.
The $600 payments were approved as part of the Coronavirus Response and Relief Supplemental Appropriations Act of 2021 approved by Congress and signed into law by President Biden in December 2020.
The payments mostly followed the same eligibility formula as the first round, with active duty service members, disabled veterans, pension and survivor benefits beneficiaries, Social Security and SSDI recipients and others who received stimulus payments in the spring 2020 eligible again.
The Treasury Department said the second round of payments provided “critical economic support to those who, through no fault of their own, have been adversely impacted by the COVID-19 pandemic.”
The second round of payments were distributed automatically, with no actions required for eligible individuals.
Aside from the $600 stimulus checks, the legislation also included an extra $300 a week in unemployment aid, meaning jobless workers received regular state unemployment payments augmented by $300 on top of that through March 14, 2021.
COVID Relief Package
The $600 stimulus checks went to almost everyone eligible for the first round in spring 2020 in addition to:
- Mixed-status Immigrant Families: U.S. citizens and green card holders may have received stimulus payments, even if they filed a joint tax return with an undocumented spouse, as well as additional $600 checks per dependent child; retroactively, mixed-status families were eligible for the $1,200 per household and $500 per child s allocated through the CARES Act; and undocumented immigrants and other non-citizens without Social Security numbers and who filed individual tax returns were ineligible.
- Dependent Children: Their families were eligible to receive$600 per child, up from $500 in the first round
High Income Phase-outs: Phased out completely for individuals who earned more than $87,000 (previously it was $99,000) and couples who earned $174,000 (previously $199,000).
Second Recovery Rebate Amounts
- Maximum $600 for individual tax filers.
- Maximum $600 for couples who make up to $150,000.
- Individuals who earn above $87,000 and couples above $174,000 are not eligible for the stimulus.
- An additional $600 per each child (according to IRS rules).
Second Stimulus Check Phase-Outs
- $75,000 in annual AGI for singles.
- $112,500 for heads of household
- $150,000 for married couples (when couples file joint tax returns)
- Payment is reduced by 5% t or $5 of every dollar above that mark; or $50 for every $1,000 above $75,000.
- Completely phased out at $87,000 for singles and $174,000 for couples (with no children)
Past Proposed Stimulus Measures
- CASH Act: The House of Representatives passed the CASH Act however efforts for a $2,000 second stimulus check are effectively dead. The Senate passed on the House-passed CASH Act which would have increased the second-round stimulus checks approved by the COVID-Related Tax Relief Act from $600 to $2,000. A new Congress will be sworn in on on Sun. Jan. 3 and could revive the legislation.
- HEROES Act: On May 12 House Democrats unveiled a 3 trillion stimulus package and it passed the House on May 15. Negotiations with the House and Senate are next. Even if the HEROES Act is not passed, both parties will sit down to work out another bill that can garner cross-party support. Details of the stimulus package include:
- $1 trillion would go to state, local and tribal governments.
- $1,200 stimulus payments also would go out to most Americans under the plan, with a maximum of $6,000 per household.
- The $600 extra in weekly unemployment insurance through January.
- Student loan payments would be paused through September.
- $175 billion benefit to subsidize rent and mortgage payments.
- $200 billion fund for essential worker hazard pay.
- Back to Work Bonus: On June 25 Trump told reporters “We will be doing another stimulus package…It’ll be very good, it’ll be very generous.” The White House is considering a $450 weekly bonus to unemployed workers who return to work. This weekly bonus would be paid for a limited time and would be paid in addition to the worker’s wages. The White House is also considering reducing unemployment payments to $250 or $300 a week during the second half of the year.
- Monthly Economic Crisis Support Act: Senators Kamala Harris (D-CA), Bernie Sanders (I-VT) and Ed Markey (D-MA) introduced a bill where eligible individuals would receive $2,000 per month ($4,000 per month for married filing jointly), plus an additional $2,000 per month for each qualified dependent, up to a maximum of three dependents. Full draft can be read here.
- The Emergency Money for the People Act: Would provide a $2,000 monthly payment to every qualifying American over the age of 16 for up to 12 months.
- Rent and Mortgage Cancellation Act: Would call for a nationwide cancellation of rents and home mortgage payments through the duration of the coronavirus pandemic, or up to one year.
- Heroes Fund: $25,000 premium pay increase for essential workers plus a $15,000 essential worker recruitment incentive to attract and secure workforce needed to fight public health crisis.
- Monthly Payments: 62 Congress members including Kamala Harris, Bernie Sanders and Alexandria Ocasio-Cortez wrote a letter urging Congress to make monthly payments.
Getting America Back to Work Act: Provides payroll tax rebate that covers 80% of payroll expenses aimed at allowing businesses to easily hire and retain employees.
First Stimulus Checks – CARES Act
The most well-known bill, the CARES Act, included stimulus checks which provided a maximum non-taxable $1,200 for individual tax filers, up to $2,400 for couples plus $500 per child.
Recovery Rebate Amounts
- A maximum $1,200 for individual tax filers.
- Up to $2,400 for couples who make up to $150,000 annually.
- Those who earn more than $99,000 annually are ineligible.
An additional $500 per each child (per IRS rules).
Stimulus Checks Phase-out
- $75,000 in AGI for singles.
- $112,500 for heads of household.
- $150,000 for married couples (when couples file joint tax returns).
- Payment is reduced by 5% or $5 of every dollar above that mark; or $50 for every $1,000 above $75,000.
- Completely phased out at $99,000 for singles and $198,000 for couples (with no children).
Complete an IRS online form so the IRS can identify you and your dependents, and receive valid direct deposit and address information about you. Americans with qualifying children younger than 17 years old and who do not file taxes must use the IRS tool to submit information to receive the payments.
The IRS link: https://www.irs.gov/coronavirus/non-filers-enter-payment-info-here.
Additional CARES Act Questions and Considerations
What to do if Your Address or Bank Information has Changed
- If you have moved since you last filed your taxes, submit a change of address form, which normally takes four to six weeks to process, to ensure you receive the payments.
- If you filed a paper copy of your taxes or closed the bank account used to receive previous tax refunds, the IRS will send a check in the mail.
What Are College Stimulus Payments for College Students?
There was $14 billion in federal funding set aside for higher education and $6 billion went directly to students as part of the CARES Act aside from the $1,200 stimulus payments.
Colleges were required to use the funds to provide emergency grants and financial assistance to help students with expenses related to the pandemic. The expenses included a range of costs, such as health care, child care, food, living expenses or computer equipment..
How Do I Change My Address With The IRS?
If you have moved since you last filed, let the IRS know your new mailing address.
Do I Have To Have A Social Security Number To Get A Check?
You must have a Social Security number to receive stimulus checks, including anyone you’re claiming for a credit e.g. a child.
Will Receiving Stimulus Checks Affect VA Benefits? Other Government Benefits?
No, it will not affect your benefits.
Will My Bank Seize My Stimulus Check to Cover Existing Debts?
It depends on the bank. For example, military-focused USAA announced a 90-day pause on recovery of negative account balances existing when stimulus payments were were deposited.
Check with your bank for their policies’ details.
Watch Out for Stimulus Check Scams
The IRS does not contact individuals via telephone, texts/SMS, email, mail or social media asking for personal information. All stimulus check information is gathered by the IRS from your tax return. The IRS will only contact you through the mail.
How Americans Used Their First Stimulus Payments
According to the U.S. Census Bureau’s Pulse Survey, when it came to their first Economic Impact Payments:
- About 85.5% received or expected someone in the household to receive the payment.
- About 80% reported using it on food, and 77.9% on rent, mortgage and/or utilities, including gas, electricity, cable, internet and phone.
- More than half (58.2%) spent payments on household supplies and personal care products.
- About a fifth (20.5%) spent the money on clothing.
- A smaller share (8.1%) spent (or would spend) the stimulus on household goods like TVs, electronics, furniture, and appliances or on recreational goods like fitness equipment, toys and games.
- Adults in households with incomes between $75,000 and $99,999 were more likely than other households to use their payments to pay off debt or to add to savings.
- 87.6% of adults in households with incomes of $25,000 or less planned to use their payments to meet expenses.
Student Loans Paybacks Suspended
Borrowers with student loans held by the U.S. Department of Education (e.g. direct loans, but not most Family Federal Education Loans (FFEL) and Perkins Loans) have had their payments paused until Jan. 31, 2022.
The Education Department announced Aug. 6, 2021, the final extension on the pause, which includes these relief measures:
- Suspension of loan payments.
- 0% interest rates.
- Halted collections on defaulted loans.
Federal officials warn students and parents not to accept unexpected offers of help or financial aid without first checking with your college to see if it is legitimate. The department’s Office of Federal Student Aid offers these tips to avoid scams.
Expanded Unemployment Benefits
An additional federal payment of $600 per week was applied to other unemployment benefits available to those affected by the coronavirus pandemic.
Payments went to those who were laid off or furloughed and to gig economy workers who lost work. The last payable week for benefits under the programs, established through the CARES Act and extended under the American Rescue Plan Act, through Sept. 6, 2021.
Temporary federal programs expanded and extended state unemployment benefits through:
- Pandemic Unemployment Assistance (PUA): For self-employed individuals, freelancers, contractors and others who were ineligible for regular unemployment benefits.
- Pandemic Emergency Unemployment Compensation (PEUC): Extended benefits for those running out of regular unemployment benefits.
- Pandemic Unemployment Compensation (PUC): An extra $300 a week for all qualifying for unemployment benefits.
- Mixed Earners Unemployment Compensation (MEUC): Provided an extra $100 per week to those earning at least $5,000 annually in net self-employment income.