President Biden signed a third round of pandemic relief, including a new stimulus package, into law as of March 12, 2021.
How much can my clients expect to receive on their third stimulus check?
The bill states that individuals who make $75,000 or less can expect to receive $1,400. That means that married couples filing jointly who make $150,000 or less will receive $2,800. Dependents under age 17 who meet the requirements for a qualifying dependent may also receive $1,400, meaning a family of four could receive $5,600.
The stimulus check phases out completely for individuals who make $80,000 or more and couples who make $160,000 or more.
Will college aged or adult dependents receive the third stimulus check?
Dependents over the age of 17 did not receive the first two stimulus checks. However, this bill does include dependents ages 18-24 who are attending college as well as other adult or elderly dependents. This means all dependents, no matter the age, will be eligible for the $1,400 stimulus check.
When will the third stimulus get approved?
President Biden signed the bill into law on March 12, 2021.
Will my client need to file their 2020 taxes before they can receive their stimulus check?
As with the first two checks, your client’s AGI will be used to calculate how much they will receive for the third stimulus. The IRS will look at 2019 and 2020 tax returns to determine eligibility.
If your client had a child in 2020 or experienced another major life change that affected their tax return, you should encourage them to schedule an appointment with you as soon as possible. They may be eligible for more stimulus money if they file their 2020 tax return before they receive their third check.
Will my client owe taxes on this third stimulus check?
No. Stimulus payments are not subject to federal taxes.
What if my client is still waiting for the first stimulus check?
If your client never received their first or second payment, you can help them claim them on their 2020 tax return. Fill out line 30 on Form 1040 to claim the Recovery Rebate Credit.
Does this bill include provisions for my clients who are on unemployment?
Yes, this bill will extend the existing $300 weekly unemployment benefit from the second stimulus bill through September 6, 2021. It will also provide a tax break on the first $10,000 in unemployment benefits.