While we wait for an official stimulus check update, which will come following the passage by the Senate of President Biden’s $1.9 trillion economic relief legislation and the president signing it into law, here’s a mind-boggling number to keep in mind related to the new federal action that makes the latest round of checks possible.
Once Biden’s massive new relief bill is finally passed by Congress, it will bring the total dollar amount of federal relief approved by Congress in the wake of the coronavirus pandemic to almost $6 trillion (which includes action taken under the Trump administration, as well). Biden’s big rescue package which, of course, added significantly to that total, includes a third round of coronavirus stimulus checks at its core — checks for generally $1,400 that will be sent to millions of Americans. Before they start to be distributed, though, there’s something important about them that you should definitely be aware of.
First of all, now that tax filing season is underway, it’s important to know that there’s an important connection between your next stimulus check and your 2020 tax return that’s due by April 15 (unless you live in Texas).
When you choose to file your taxes might actually end up impacting how much money you get with the new round of stimulus checks from the Biden administration. Here’s why — as we noted in a previous post, your eligibility for the full $1,400 stimulus check amount or even for a phased-out version of it will be dependent on how much money you make.
The IRS is that agency that will be sending out the stimulus checks, and, accordingly, it will be checking your most recent tax return to identify the most recent adjusted gross income (AGI) figure it has on file for you. That suggests the following – for some people, it will probably be ideal to hurry and get your 2020 tax return filed, if your financial situation is better this year.
Why? Well, the 2020 tax return is going to cover last year — a hellish year for many people, when the coronavirus pandemic ravaged people’s lives and incomes.
If you had a child in 2020, if you got married in 2020 (if your incomes combined come in below the $150,000 threshold), or if you could be claimed as a dependent on someone’s 2019 tax return, but not their 2020 tax return, you’ll want to hurry up and file your taxes. But you should probably wait to file your 2020 tax return until the new bill is passed and checks start going out if your income was higher in 2020, if you had a death in the family in 2020, if you got divorced in 2020 (and your individual income takes you over the $75,000 threshold), or if you can’t claim your child as a dependent any longer.
Senate passage of the $1.9 trillion bill that funds the new round of stimulus checks could come later this week, in which case Biden would sign it into law not long after — kick-starting the new check disbursements.
