“I’m not going to cut the size of the checks. They’re going to be $ 1,400. Period. That’s what the American people were promised,” President Joe Biden said at an event at the White House Friday. But he also said this: “We have to use that money. So people make $ 300,000. (Not everyone agrees.)
A higher maximum per person mixed with new qualifications on income that couldthis time can result in a reduction in the total for some people. There may also be additional life changes that can reduce your third check. We’ll explain everything you need to know about what could lead to a smaller one . This story was recently updated.
$ 1,400, but maybe not in the way you’d expect
For the first and second incentive check, Congress used one, with the same income limits and the same rate at which payments are phased out. We have calculators to help you calculate and – and depending on how things are going.
Here are the income limits that Congress has set, using your, to receive the first and second payment in full:
- Single taxpayer earning less than $ 75,000
- Head of household earning less than $ 112,500
- Couple filing jointly that earns less than $ 150,000
For the third check, Biden and Congress are reportedly considering reworking the formula to better target payments to people within a certain salary range, based on their.
According to the Washington Post, here are the income caps Congress is considering receiving a full third payment:
- Single taxpayer earning less than $ 50,000
- Head of household earning less than $ 75,000
- Couple filing jointly that earns less than $ 100,000
What that could mean for you is that while you may qualify for a first or second check, on the same income level, this time around you may receive a much smaller compensation – if you qualify at all. Here’s a graph that looks at the differences that lowering the income threshold can cause.
Upper income limit to receive 1st, 2nd and 3rd payment
|AGI to phase out the $ 1,200 initial payment||AGI will phase out the second $ 600 payment||AGI to phase out the third “targeted” payment of $ 1,400|
|One tax file||
|Head of a household||
|Married, filing jointly||
Congress is also reportedly considering changing the rate you’d get rid of from a payment to exclude higher earners from receiving a payment, tweeted Jeff Stein, a Washington Post reporter. For the first and second checks, Congress set a phase-out rate of $ 50 for every $ 1,000 in income above the baseline.
For example, a change that would phase out the amount you would get at a rate of $ 100 instead of $ 50 for every $ 1,000 in income could quickly put some individuals and families out of reach of a payment. fall.
Was your income higher in 2019 or 2020 than in 2018?
Your, is a term commonly used on the annual federal tax return to describe your total income, including assets (such as stock sales, credits and deductions, or an inheritance) that are beyond your usual salary. You didn’t get the first incentive check, sent after the CARES law was passed in March, if your AGI exceeded a certain income threshold. There was an even lower number with the $ 600 stimulus check, and Congress is weighing in on a limit on a third that could be even lower.
The first stimulus check was based on your 2018 or 2019 taxes, if you had filed them. The second audit, approved by Congress in December, only looked at your 2019 taxes.
Because the third check timing could coincide, Congress is reportedly considering using your 2019 taxes for the third round of stimulus controls as well. That means if you got a new job or made more money between 2018 and 2019 (congratulations), you can race to the upper limit faster and only receive a partial check.
Anyhowever, you could still contribute to the total amount – and the same could be the case with a third check. Again, our and can help estimate the sum. Here’s more about the relationship between .
What if you now have fewer dependents than before?
For the first two checks,has been an important factor in how much stimulus money a household receives. in many cases are entitled to their own stimulus check. In the first round of direct payments, households received an additional $ 500 for each “ , “which Congress defined as a legal minor who is 16 years of age or younger.
The IRS definition of a(Aged 23 or younger, and financially dependent on the tax bearer) is not the same one used for the first two incentive checks.
For the third check, Biden proposed opening the definition toon your taxes. This time, Biden is throwing a payment of $ 1,400 to each eligible dependent. It was $ 600 for the second round.
But if for some reason you don’t have the same number of dependents, you may not get their share of your final check. For example, if someone died, the IRS expected you to.
A calculation error can initially result in a smaller check
Itand . Written mistakes, depositing errors and complex rules can result in your household getting less money on the third stimulus check than you might be entitled to – for you . Or you may not normally need to file taxes and as with the first two checks, you should .
For the first two checks, for any reason, if a problem prevented you from receiving all or part of your incentive money, you can. Without a new law, we don’t know how those who would owe a third payment but did not receive it will claim a missing check.
Has someone in your household passed away recently?
If your household receives a stimulant check that is a spouse or dependent child who died between your last tax return and the receipt of the incentive check, the IRS may have sent you a smaller amount than your tax filing status, deductions, credits, or. In some cases it is .
Congress has not said how it will deal with this if it approves the third payment.
Do you owe money on your taxes?
If so, the protections under the Consolidated Appropriations Act that prevented the IRS from clearing your unpaid tax incentive check don’t apply to people whoon their . “If you are an eligible person who has not yet received your full EIP and you have certain outstanding debts, some or all of your unpaid incentive payments will be withheld to offset those debts,” the Taxpayer Advocate Service said in a blog post .
However, the government agency says the IRS is investigating this issue to help taxpayers get their. Congress and the IRS have not discussed how they will address this situation with a third party audit.
For more information about incentive money, click hereand what else could be in it .