When the CARES Act became law back in March, it flooded the economy with critical economic relief checks. The COVID-19 pandemic caused many people to lose their jobs, which created housing, healthcare and economic crises. The short-term financial solution helped the country initially, but it became clear that the public needed more assistance.
The pandemic will be the most pressing issue for some time, so the federal government is negotiating to pass the second round of stimulus checks. The news left a number of people with questions, so here are five things you must know about your stimulus check. They may answer a few of your questions and make your life a bit easier once negotiations end, and the final bill passes.
1. Direct Deposit Is Faster
Legislators designed the CARES Act to send Americans financial relief as quickly as possible. The IRS implemented direct deposit to make this happen nearly overnight, but officials estimated a five-month wait period for anyone who had to get a paper check.
You can avoid waiting that long for your next stimulus check by filling out your IRS profile. After you link your checking or savings account, the IRS can deposit your check as soon as it’s available. If you already filed your 2019 return, this information is likely already filled out.
2. Payout May Differ Per Person
The max payout for single filers is $1,200, which is the same amount as the last round of checks. Couples may get $2,400 maximum, depending on their income. The CARES Act paid $500 for each dependent under 16 years old, but that may change.
If the Republican HEALS Act becomes law, dependents of any age will receive $500 even if they’re elderly, but the Democrat’s HEROES Act would pay up to $1,200 for three dependents at a maximum. Houses with more than three dependents wouldn’t get additional funding.
3. Seized Checks Won’t Happen
Back in April, some debt collectors seized certain stimulus checks before the recipients ever saw them. Because debt payment wasn’t the intended purpose, the courts ruled that the CARES Act forbids state and federal debt collectors from seizing the checks.
Anyone who defaulted on their student loans or owes back taxes won’t have to worry about those factors interfering with their checks. Instead, you can use your economic impact payment responsibly, such as by setting it aside for emergency savings.
4. Checks Are Tax Credits
You might also worry about accepting the stimulus checks because you don’t want to pay more taxes next spring. Officials have stated that the checks won’t count towards your taxable income for 2020, so you’ll get to keep all of it without worrying about paying the government back.
5. Online Tracking Is Available
Once the next bill passes, you can check the status of your payment through the IRS website. The same link offers information for providing bank account details so that everything is in one place. You can also download the Get My Payment app to track your physical check if direct deposit isn’t an option for you.
Watch for Updates
The next round of stimulus checks is an ever-evolving situation, so watch the news for updates for more information as time progresses.