12 FAQs About the Second Stimulus Check
Many Americans will say goodbye to 2020 with an extra $600 in their pockets, after Congress rushed to approve a relief package Monday night.
The $900 billion relief bill includes $600 stimulus checks for most adults who aren’t claimed as dependents, plus $600 for children 16 and younger. The bill will also provide a $300 supplement to unemployment benefits for 11 weeks, an additional $284 billion of Paycheck Protection Program (PPP) funds and $25 billion in emergency rental assistance. As of Tuesday morning, President Trump was expected to sign it.
12 FAQs About the Second Stimulus Check
Here’s what we know so far about the second stimulus check. We’ll update this post as we learn more.
1. How much will I get for the second stimulus check?
Individuals making up to $75,000 per year will get $600, and couples making up to $150,000 will get $1,200. People who earn up to $112,500 and file as head of household will also receive the full $600. That’s half the amount of the first round of checks. For each child 16 or younger in the household, you’ll also get the full $600. That means a couple with two children who got $3,400 with the first round will now get $2,400.
For every $1 you earn above the limits, the payments will be reduced by 5 cents until they disappear altogether. Because checks are smaller this time, they’ll phase out at lower levels. For example:
- An individual without dependent children won’t receive a payment if their income was above $87,000 (previously $99,000).
- A couple without dependent children won’t receive a payment if their income was above $174,000 (previously $198,000).
- A couple with one child younger than 16 won’t receive a payment if their income was above $186,000 (previously $208,000).
2. What year’s tax returns are the payments based on?
They’re based on 2019 tax returns, even though they’re technically an advance on a 2020 credit. (No, that doesn’t mean you’ll owe more on your 2020 return, as we’ll discuss in question 8.) If your income dropped in 2020 and made you eligible for a payment or you had a child in 2020, you’ll get your payment as a rebate in 2021 when you file your 2020 tax return.
3. Will college students who are claimed as dependents by their parents get a check?
The rules are the same as they were for the first round: If they’re 17 or older, they won’t qualify. They may be eligible for both the first and second payments (a total of $1,800) if they file their own tax returns for 2020 and they aren’t claimed as a dependent.
4. What about disabled adults who are claimed as dependents by a family member?
Again, if they’re 17 or older, they’re not eligible. They’ll also probably qualify for both payments if they file their own returns and no one claims them as a dependent for 2020.
5. I’m on Social Security. Do I get a stimulus check?
Yes, as long as your income is below the thresholds listed above and no one claims you as a dependent. The same applies to people who receive Railroad Retirement, SSI, SSDI and VA benefits. The IRS will receive your information from Social Security or whatever agency that provides your benefits, so you don’t need to take action.
6. I don’t have a Social Security number. Will I get a stimulus check?
You won’t get a stimulus check, but if you’re married to someone who has a Social Security number, they’ll still get a $600 check. This is a change from the first round of checks. Under the CARES Act, if one spouse had a Social Security number and the other didn’t, both spouses were ineligible.
7. When will I get my check?
Treasury Secretary Steven Mnuchin told CNBC on Monday that the first payments could go out early next week. People who have up-to-date direct deposit information on file with the IRS or who receive government benefits, like Social Security, through direct deposit will get their checks fastest.
8. Are the payments taxable?
No, you won’t owe taxes on stimulus payments because the checks are a special 2020 tax credit that you’re getting early — though they’ve sometimes been described incorrectly as an advance on your 2020 refund. A tax credit reduces your tax liability dollar for dollar. So if you’d normally owe nothing and you got a special $600 credit, you’d get a $600 refund. You’re simply getting that $600 credit that you wouldn’t normally get a couple months early.
9. I didn’t get the first round because I earned too much in 2019, but I lost my job in 2020. Will I qualify for this round?
Yes, as long as your 2020 income falls within the limits specified in Question 1, but you’ll have to wait until you file a 2020 tax return. You can receive both the $1,200 and the $600 payments if you’re eligible for the maximum benefit.
10. What if I had a child in 2020?
You won’t get the $600 credit for your new addition at the same time you get your stimulus payment, but when you file your 2020 tax return, you’ll get $600 on your child’s behalf as a rebate.
11. Will I get a check if I owe back taxes?
Yes. Your check won’t be garnished or reduced if you owe federal or state taxes, or if you’re delinquent on federal student loans.
12. What about child support?
The rules for unpaid child support and stimulus checks are the same as they were for the first payments. If your tax refund is seized by the Treasury Offset program, your stimulus check probably will be as well. If someone owes you child support and you typically receive their tax refund, you’ll probably get their stimulus check as well. However, it will first go to the state agency that handles disbursement of child support payments, so don’t expect their check right away.
Robin Hartill is a certified financial planner and a senior editor at The Penny Hoarder. She writes the Dear Penny personal finance advice column. Send your tricky money questions to [email protected].