HERE are simplified Questions & Answers about the freshly minted third round of stimulus payments under the new American Rescue Plan Act of March 2021.
1. How much is the third Economic Impact Payment?
$1,400 for individuals, $2,800 for married couples plus $1,400 for each dependent. You will get a payment for all your dependents claimed on a tax return (not just their qualifying children under 17).
2. Who are eligible for the third Stimulus Payments?
U.S. citizen and resident aliens who are not a dependent of another taxpayer and have a valid Social Security number with adjusted gross income (AGI) that does not exceed:
• $150,000 if married and filing a joint return or if filing as a qualifying widow or widower.
• $112,500 if filing as head of household.
• $75,000 if single or married people filing separate returns.
3. Payments will be phased out or reduced above those AGI amounts:
• $160,000 if married and filing a joint return or if filing as a qualifying widow or widower.
• $120,000 if filing as head of household.
• $80,000 if single filers and married people filing separate returns.
4. How will IRS determine who are eligible?
The IRS will use information of people who:
• Filed a 2020 tax return.
• Filed a 2019 tax return if the 2020 return has not been processed yet.
• Did not file a 2020 or 2019 tax return but registered for the first Economic Impact Payment.
• Received Social Security and Railroad Retirement Board benefits, Supplemental Security Income (SSI) or Veteran benefits in 2020.
5. How do I find out if the IRS is sending me a payment?
Check the status of your third payment at “Get My Payment” tool on IRS.gov.
6. How will the IRS know where to send my payment or if I changed bank accounts?
• Taxpayers with direct deposit information on file will receive the payment via direct deposit.
• Those without current direct deposit will receive the payment as a check or debit card in the mail.
7. Active Military:
If you or your spouse is an active member of the U.S. Armed Forces at any time during the taxable year, you will receive up to $2,800 (even if only one spouse has a valid SSN).
8. Is any action needed by those who don’t typically file tax returns?
Most people who receive Social Security retirement, disability, railroad retirement, and veterans’ benefits in 2020 need not take any action to receive a payment.
9. Will I receive the 3rd stimulus if I didn’t file a 2019 or 2020 tax return and didn’t register with the IRS.gov non-filers tool last year?
Yes, if you meet the eligibility requirements. You won’t receive an automatic payment now but can get it when you file a 2020 return and claim the Recovery Rebate Credit.
10. Will people who receive a payment get a notice from the IRS?
Yes, you will receive an IRS notice.
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Victor Santos Sy graduated Cum Laude from UE with a BBA and from Indiana State University with an MBA. Vic worked with SyCip, Gorres, Velayo (SGV – Andersen Consulting) and Ernst & Young before establishing Sy Accountancy Corporation.
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He retired after 50 years of defending taxpayers audited by the IRS, EDD, BOE and other governmental agencies. He published a book on “How to Avoid or Survive IRS Audits” that’s available at Amazon. Readers may email tax questions to [email protected].
