Second stimulus check facts: What to know about eligibility, payment size, IRS priority

Tuesday is an important day for the destiny of stimulus bill negotiations. With solely 14 days left till the election, the window is quickly closing for Congress to move laws. This leaves qualifying Americans questioning about doable timelines to receive another check, in addition to how big that examine may very well be. 

We will take you thru a very powerful information about stimulus funds, from the way in which the IRS calculates payments to how federal taxes could change your next stimulus check, and past.

1. Stimulus negotiations may come collectively on the final minute

In the present day is the deadline Home Speaker and lead Democratic stimulus negotiator Nancy Pelosi set because the final day to finalize the White Home’s $1.8 trillion stimulus supply if the bill has a chance of passing before the election. “I do not need to carry over the droppings of this grotesque elephant into the subsequent presidency,” Pelosi stated, based on The New York Times. “We have to get one thing massive, and we have got to get it finished quickly and we have got to get it finished proper.”

The Senate is true now in session and shortly anticipated to vote on a brand new stand-alone invoice to renew the Paycheck Protection Program. Tomorrow, Senate Majority Chief Mitch McConnell will lead another vote on last month’s failed “skinny” stimulus bill — word that this invoice does not comprise cash for another round of stimulus checks. This might doubtlessly arrange a battle between Senate Republicans and the White Home, which is presently negotiating a comprehensive package with Democrats, even when neither vote passes the Home of Representatives or turns into legislation. 

Whether or not Senate Republicans will fall in keeping with the White Home proposal stays to be seen, however McConnell has stated he’d deliver the White Home invoice to a vote within the Senate “sooner or later,” based on Politico, regardless of his public repudiation.

2. People who find themselves incarcerated may obtain cash in spite of everything

A decide in California dominated that imprisonment should not disqualify someone from receiving a stimulus check (PDF) and ordered the IRS to launch funds to people who would otherwise meet the qualifications. The ruling discovered that the CARES Act didn’t particularly or legally bar this group of individuals from getting checks and that the IRS’ interpretation is incorrect. If it holds, as much as 2 million folks or their households may nonetheless obtain funds for these people.

3. Stimulus cost calculations use this formulation

It’s possible you’ll have an interest to know that the IRS has a formula for working out how much stimulus money you could get, and that is what determines whether or not you obtain the complete quantity, a partial cost or way over the $1,200 when you have youngsters.

It additionally explains the way you may nonetheless have the ability to get some stimulus cash, even when your loved ones’s yearly revenue exceeds the limit set out by the CARES Act in March. The calculations begin along with your family’s complete adjusted gross income, add on the money allotted to qualifying dependents, after which begin deducting from the overall, primarily based in your revenue bracket (as outlined by the CARES Act). 

You may calculate how much you could get in a stimulus check now, together with for a second examine. 

Now playing:
Watch this:

Next stimulus checks: What to expect

3:03

4. Most people paid off debt or banked their stimulus checks

A new survey this week on how people in the US used their first stimulus check shed light on the economic reality of the coronavirus’ effects. The survey from the Federal Reserve Bank of New York polled 1,300 households between June and August. The study found that of the 89% who reported receiving a stimulus check ($2,400 median total):

• 29% spent the stimulus money (on essentials, nonessentials and donations).
• 36.4% saved their stimulus money.
• 34.5% used it to pay down debt.

Here’s how respondents would spend a second check of $1,500, and how people used enhanced unemployment payments.

5. You may be in one of 5 different payment waves

Eligible Americans get their checks at different times, often due to how they’re getting paid. For example, people who have direct deposit — an electronic transfer of funds into their bank account — set up with the IRS could get their checks weeks before those who receive a paper check or prepaid EIP card in the mail. We identified five priority groups based on the first stimulus checks. 

6. New eligibility changes could get more money for dependents

It’s likely that a second stimulus check would largely follow the same rules and guidelines as the first. But the qualifications for who could get money are subject to change, in ways that could benefit your family. One proposed bill redefines who counts as a qualifying dependent, and would give your family $500 for each dependent you claim on your taxes, regardless of age. 

The current $1.8 trillion proposal from the White House offers a $1,000 payment per child dependent. We’ve explained how some families might benefit more from one bill versus the other in terms of a total payment. (Here’s how young people could qualify for their own $1,200 check.)

7. Your second payment could possibly arrive quicker than the first

With the first check, the IRS learned how to mobilize and deliver stimulus money, and worked out many of the growing pains in the plan. If a second check is approved, it’s likely that the agency could speed up the process of sending out the first set of payments. The tracking tool is already up and running, the system is in place and it’s likely that the majority of people who qualified for a first check will also receive another. 

The timeline is constantly changing, but we’ve mapped out potential dates a check could be sent if approved before — or after — the election.

8. There are plenty of confusing exceptions and rules

If and when a second stimulus check is approved, there will be lots of small details, rules and exceptions that can get confusing. While some situations will be easy to understand, others around you and your dependents might make it unclear if you’re eligible, and for how much money. The fringe cases are many. 

For example:

9. The IRS still owes some people money from the first round

If you’re still waiting for your first stimulus payment, there are several ways to hunt it down. As many as 9 million people were estimated to be eligible for a first check but didn’t receive it, because it requires registering with the IRS — an extra step most people didn’t have to take. The deadline is Nov. 21 and we show you how to do it. Some people with dependents received only a partial payment and are still owed money. The deadline to get that in 2020 passed Sept. 30, but we explain how you can claim it with next year’s taxes. 

10. You won’t have to pay taxes on any stimulus money

The IRS doesn’t consider stimulus money to be income. That means a payment you get this year won’t reduce your refund in 2021 or increase the amount you owe when you file your 2020 tax return. You also won’t have to repay part of your stimulus check if you qualify for a lower amount in 2021. The IRS said if you didn’t receive everything you were owed this year, you can claim it as a credit on your 2020 federal income tax return by filing in 2021. Here’s everything to know about stimulus checks and taxes.

There’s much more to know about other government payments during the pandemic, including a possible interest check from the IRS and where the $300 federal unemployment benefit is now.