Second Round of Stimulus Checks: Here’s What You Need to Know
Dec 20 Congress signs new stimulus bill
As of Dec 21, Congress finalized an agreement on COVID-19 relief bill and it is on the way to the President. It means they are also about to approve a second stimulus check for qualified adults and their dependents. Here’s what we know for the moment.
If you want to learn about the first stimulus check, who is eligible for it, and how much it is, check out our federal stimulus FAQ article.
On Dec 22, President Trump posted a video tweet calling for changes to the proposed bill, including higher direct cash payments to taxpayers.
How much is the second stimulus check?
According to the bill that has passed congress, the direct payment is going to be $600 per individual, which is half as much as the first payment authorized earlier this year. However, it is also expected that families with kids will receive an extra check for each child for $600.
Just like the first stimulus checks, income eligibility is expected to be based on adjusted gross income (AGI). The AGI eligibility threshold will depend on filing status (single filers cap at $99,000, joint filers cap at $198,000, and head of household up to $112,000.
This could change as President Trump (and later House Speaker Nancy Pelosi voiced agreement) called for higher payments to taxpayers.
How will I receive the stimulus payment?
Just like the prior stimulus, taxpayers who already provided direct deposit information when receiving a tax refund when filing returns will be the first ones to get the check as the IRS has their information on file.
If you were not eligible for a tax refund, the IRS did not receive your payment information even if it was keyed in on the return.
For those taxpayers who are eligible for the payment but who didn’t share their bank account information, there are two options of getting the stimulus payment: a paper check or a prepaid debit card.
As a reminder, we outline this and more in our Stimulus FAQ (link above). Please refer to our flow chart to understand if the IRS has your direct deposit information below.
Second stimulus check: when will it be sent?
With the first stimulus check, the IRS began sending out the checks nearly in two weeks after the CARES Act went into effect. Taking into account that the IRS may already have your bank account information, you may receive the check faster. However, we shouldn’t expect the payment until January 2021.
College students might be eligible for $1,800+ payment
If an individual provides more than a half of their own support, they are not eligible to be claimed as a dependent on their parents’ return.
However, if you can be considered as a qualifying taxpayer, which means you are not on anyone else’s tax return, you’re also eligible for a stimulus check ($1,200) under the CARES Act. And there is a possibility that you can count on the second stimulus check ($600, possibly more), too.
Second stimulus check & Non-resident aliens
You didn’t have to be a US resident to receive the first payment. According to the CARES act, what you needed was the Social Security Number (SSN) and the fact that you lived and worked in the United States.
Individuals who file jointly (Married Filing Jointly, MFJ) with a spouse who uses an ITIN will be allowed to collect a check (though the person with the ITIN will not).
If you are not sure if you are eligible for the payment, do not hesitate to contact our experts and get help with the COVID-19 tax stimulus.
Until the bill is signed by the president & the IRS makes this information official, there are still a lot of unknowns. Will the individuals who are not required to file tax returns be eligible to receive the second stimulus check like they were eligible for the first payment?
Will the individuals with 2020 income above the established threshold be eligible to keep the payment in full like the first stimulus check?
We will update the information on TFX website once the answers to those questions are official.