Topline

The Internal Revenue Service announced Tuesday that it has now sent out all “legally permitted” stimulus checks from the first and second rounds of coronavirus relief legislation—that means that if you’re eligible for those payments and did not receive them (or received less than you’re due), you’ll need to claim the extra money on your 2020 tax return.

Key Facts

The IRS and Treasury Department began sending out the first round of payments authorized by the CARES Act in April—$1,200 for single individuals ($2,400 for joint filers) and $500 per eligible child.

The second round of payments authorized in December were in the amount of $600 for single individuals ($1,200 for married couples filing jointly), and $600 per eligible child.

The income thresholds for both those payments were the same: up to $75,000 per year for individuals and up to $150,000 for couples filing jointly, with the amount of the payments phasing out slowly above the thresholds.

The IRS said Tuesday that while some payments from the second tranche of aid may still be making their way through the mail, it has now issued and sent out every payment it is legally permitted to send.

Americans who don’t receive the full payments they are eligible for (based on their 2020 income) can claim a Recovery Rebate Credit on their 2020 tax returns (both rounds of stimulus checks have been structured as advance credits for the 2020 tax year).

The IRS also noted that the Get My Payment site, which allows eligible individuals to track the status of their stimulus payments, was updated for the latest time at the end of January.

Big Number

$412 billion. That’s how much money the federal government sent to Americans in the first and second rounds of stimulus checks, the IRS said. Those payments reached 160 million people in the first round and 147 million people in the second round.

Key Background

Despite objections from Republicans, Democrats in the House of Representatives are moving ahead with President Biden’s $1.9 trillion American Rescue Plan. That plan includes a third round of stimulus checks in the amount of $1,400 for individuals earning less than $75,000 per year and $2,800 for joint filers earning less than $150,000 per year, plus up to $1,400 per eligible dependent. Those payments would phase out faster than they did in the CARES Act to address lawmakers’ concerns that too many high-earning families received stimulus checks they didn’t need or spend in 2020.

What To Watch For

The first two rounds of stimulus checks were sent out based on 2019 or 2018 income, depending on when taxpayers filed their 2019 returns. Technically, those checks were an advance payment of a 2020 credit. The third round of checks is likely to be an advance payment of a 2021 credit and will be based on taxpayers’ 2020 or 2019 tax return, depending on when they file.  Taxpayers whose income rose in 2020 could receive a smaller third payment if they file taxes early, before the next stimulus bill passes, than they would if they waited. Those whose income was down substantially in 2020 from 2019, may want to file more quickly—-it could mean they’ll receive a bigger round three stimulus check.

Further Reading

With Congress Still Debating Stimulus, Should You Rush To File Your 2020 Tax Return Or Wait? (Forbes)

IRS Warns Of Delays And Challenging 2021 Tax Season: 10 Tax Tips For Filing Your 2020 Tax Return (Forbes)

Here’s Where $1,400 Stimulus Checks, $15 Minimum Wage And The Rest Of Biden’s $1.9 Trillion Rescue Plan Stand Today (Forbes)