After months with little movement in the negotiations for a, three new proposals on Tuesday facing the economy and American citizens, but from .
However, if Congress authorizes athis year or early 2021 – and this is still an open question – the can change to produce larger or smaller checks for tens of millions of people. Some Until qualifying is finalized, there may still be some uncertainty about
It doesn’t matter if you are, you will want a realistic image of . With that in mind, we’ve presented a few scenarios that could result in a smaller second payout. And if you had to wait for the first payment, follow these steps We recently updated this story.
Stimulus money: a key thing to know
in the, the IRS has mostly used your when calculating your total payment (people who were also eligible in many cases). But some people who qualified for a check experienced personal or financial changes after depositing that could affect a future payment in one way or another.
Did you start a new job, get a raise, or get a higher overall income?
Your, is a term normally used for the IRS annual tax return to describe your total income, including assets (such as sales of shares, credits and deductions, or an inheritance, for example) that do not fall under your usual salary. The first stimulus check, and most likely the second, will cut you off if your AGI goes over a certain income limit.
There is a huge correlation between, and any change in your AGI could increase or decrease the size of your check.
For example, if you received all of the $ 1,200with the first stimulus check because your AGI was below the income limit, but then you got a promotion or a new job that pays more (congratulations), then your check may be smaller next time – since the – or you may have exceeded the threshold and . All in all, that’s a “good” problem to have.
Do you have fewer dependent children now than you did earlier this year?
Age is a big factor in how much stimulus money a household receives, but maybe not the way you think. The elderly are in many cases entitled to a stimulus check. In the first round of direct payments, households received an additional $ 500 for each “dependent child.” This is a legal minor aged 16 or under.
Interestingly, the IRS definition of a(23 years or younger and financially dependent on filer) is not the same set of terms used for stimulus checks.
If the rules remain the same (and there is), any older dependent you applied for on the first check may no longer have qualified, which means you could get $ 500 less if the rules stay the same.
Are you behind on child support or have you changed the way you claim your dependent?
In most cases, any stimulus check you receive is free to use as you see fit. However, an exception set out in thewas child support. If you owe child support to your child’s other parent, you may have some or all of your stimulus check garnished. If you received an additional $ 500 for the way you and the other parent filed a dependent claim (it’s complicated), then you changed the way you filed your 2019 tax reserve ( for example, if the other parent got full custody), you can’t get the extra $ 500. Here is .
Do you have debts with creditors or private banks?
Normally, your stimulus money cannot be seized to pay rent or federal tax. There are some exceptions, however, including the child support situation above. If those rules don’t change with the next stimulus bill, then there are two groups –– who could legitimately seize all or part of your money on the first and possibly the second check.
Some stimulus laws could change, which could disqualify you
From the terms of the– and that won’t be the case until the sitting president signs a bill – it’s not clear how or not they can change. There’s also how the IRS can interpret the law and act or withhold stimulus funds. For example, after the CARES Act was signed in March, the IRS first sent , then requested the return and stopped issuing new checks. A recent decision by a federal judge has revived them.
If this law and others concerning, were to change, this could make a person eligible for the first payment disqualified for a second check.
Have you given the IRS your new address if you moved?
If you have moved as a result of the COVID-19 pandemic and you have not(a good action to take), the agency may not know where to send a paper check or . If you received your first delivery of stimulus by direct deposit, the IRS will likely resume that route. If you have changed your bank account, you can or need .
If there is an IRS error or a missing step, you will likely need to file a claim
Theand could easily happen with the next one. Clerical errors and complex rules can cause your household to receive less money on a second stimulus check than you actually get – for you . Or maybe you don’t normally need to file your taxes and might miss a rare extra step you need to take. Perhaps you have moved (see above).
Whatever the reason, if there is an issue preventing you from receiving some or all of your stimulus money, you should be able to request a refund. The IRS is currently sortingfor a wide range of groups, and probably will do so again if .
Has anyone in your family died since your last tax return?
Our condolences. If your household received a stimulus check that included a spouse or dependent child who died between your last tax return and receipt of the second stimulus check, the IRS is likely to send a smaller amount if your status as a amended tax return, deductions, credits or AGI. If the person is recently deceased (by the time the next check arrives), the IRS requests a refund of the payment.
For more on the revival, here’s what President-elect Joe Biden could dowhen he becomes president, and .