Though the details of the relief package are still being hammered out in Washington, D.C., there are some key details available that will help you prepare for the future.
Are stimulus checks taxable?
The stimulus checks from 2020, as well as the one potentially coming your way in 2021, are not taxable. They will not be counted as income, they will not affect your refund either.
Will eligibility change?
The criteria for receiving a check may change, as Democrats have proposed sending $1400 to individuals earning $50,000 or less and $2800 to couples earning $100,00 or less, with an additional $1400 per child. Head of Household earning up to $75,000 would also qualify. Checks will likely be based off of adjusted gross income, as the previous checks were. Lawmakers are exploring basing eligibility for the stimulus on 2020 earnings rather than 2019 earnings, which means more relief for many families that have been economically impacted during 2020.
What about partial payouts?
If you earn slightly above the cap, you can still apply for a partial payment.
Approximately %71 of Americans would get the full benefits and %17 would receive partial benefits.
What about children and dependents?
Democrats are pushing a separate child tax benefit that would provide $3,600 over the course of a year for children under age 6, $3,000 for children age 6-17. Adults who can be claimed as dependents, such as college students were excluded in the last stimulus efforts and may be excluded this time around as well, though it is not a foregone conclusion. Lawmakers are still negotiating the scope of the package.
When will checks be sent out?
Payments will not be released until Congress passes the broad relief package. Democratic leaders have indicated they will move quickly to complete this process and aim to finalize legislation by mid-March, when millions of unemployed Americans would lose unemployment benefits.