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15 Things You Need to Know About the Third Round of Stimulus Checks

By Christy Bieber - Mar 19, 2021 at 8:00AM
Coronavirus stimulus checks with hundred dollar bills and U.S. flag background.

15 Things You Need to Know About the Third Round of Stimulus Checks

Congress came through with a third stimulus check

For many Americans, the past year has been difficult financially due to the impact of COVID-19. Lawmakers have worked to provide relief, authorizing two separate stimulus payments in 2020.

A third payment was also recently approved, and many Americans have already received their funds from it -- or are expected to get their money very soon. Here's what you need to know about the third coronavirus stimulus check.

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The White House.

1. The third stimulus check was authorized on March 11, 2021

On March 11, 2021, President Joe Biden signed the American Rescue Plan Act into law. The $1.9 trillion COVID-19 relief bill authorized the third stimulus check.

It also expanded unemployment benefits, provided billions to states to cope with falling revenues due to the coronavirus, and provided funds for school reopening and vaccines.

For most people, however, the third check will be the most direct form of relief and will have the most immediate impact.

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ATM cash withdrawal of hundred dollar bills.

2. The stimulus checks are for a larger amount this time

The third stimulus check is the largest to date. Eligible adults will receive $1,400, as will eligible dependents. This is a substantial increase compared with the first two checks.

The first payment, authorized in March 2020 by the CARES Act, was for $1,200 per eligible adult and $500 per eligible dependent. The second, signed into law in December 2020, was for $600 per eligible adult and dependent.

ALSO READ: 5 Signs You Can Afford to Invest Your $1,400 Stimulus Check

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Parents with female college student at graduation in cap and gown

3. More dependents are eligible for a payment this time around

The first two stimulus checks made money available only for dependents who were under the age of 17. This left out millions of college students, as well as other adult dependents.

The third stimulus check is much more broadly available. If you claim dependents of any age, including elderly relatives, you should be entitled to the $1,400 per dependent payment for them.

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Hands pulling a paycheck out of an envelope.

4. Income limits for full eligibility remain unchanged

All three of the stimulus checks have been subject to an income limit.

The maximum income to retain full eligibility for payments is the same for all three checks. Single tax filers with incomes up to $75,000 are eligible for the full amount of the money, as are married joint filers with incomes up to $150,000.

ALSO READ: Could You Get a Coronavirus Stimulus Check if Your Income Is Over the Limit?

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Close-up of the salary line on a paycheck.

5. The phaseout rules for high earners are very different

The phaseout rules for eligibility work very differently for the third check than for the first two checks.

For both of the first two payments, individuals with incomes above the $75,000 and $150,000 threshold saw their stimulus payments reduced by $5 per each $100 in earnings above these limits.

For the first check, that meant a single tax filer could still get paid with income up to $99,000 and a married couple would get some money with an income up to $198,000. What's more, people with dependents could get payments at even higher income levels.

Lawmakers didn't want very wealthy people getting a payment from the third check, so the rules are different. Single filers with incomes topping $80,000 and married joint filers with incomes above $160,000 aren't eligible for a payment at all in the third round, no matter how many dependents they may have.

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Person smiling while holding cash and a piggy bank.

6. If your bank account is on file with the IRS, you’ll be the first to get paid

The IRS has once again been tasked with distributing stimulus payments. As with the first two checks, money will be sent via direct deposit first, before any checks are mailed. The IRS prioritizes making payments to those who have provided bank account details directly to the agency.

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Stimulus check with hundred dollar bills

7. The IRS has already begun distributing payments

The IRS began making direct deposits the weekend of March 13 and began mailing as many as 150,000 paper checks that same week.

That means many Americans have received the third stimulus check already, or will do so soon.

ALSO READ: 3 Great Ways to Invest Your $1,400 Stimulus Check

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Person holding credit card in one hand and typing on laptop in other

8. Some payments will come via prepaid debit card

Although most people will get their stimulus payment via direct deposit or paper check, the IRS also sends out economic impact payments via prepaid debit cards.

Those who receive their payments via debit card typically must wait longer than individuals who get their money via other methods. The money on the debit card can be transferred to a personal bank account, obtained from an ATM, or used to make purchases wherever Visa is accepted.

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Tax forms with calculator.

9. Your check amount will be based on 2019 or 2020 tax return information

The IRS will use your 2020 tax return to determine eligibility for the check if you've filed your return and it's been processed. Your 2020 return will also be used to assess how much you're owed, based on your income last year and the number of dependents you claimed.

If you haven't yet filed your 2020 return, the IRS will use your 2019 return instead.

You may want to make a strategic choice about when to file your returns if your income has changed from 2019 to 2020 and the change impacts eligibility for the third stimulus check.

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Woman in glasses is looking at laptop.

10. The IRS is using information that nonfilers provided for the first two checks

If you don't file a tax return but you used the IRS form for nonfilers to claim either your first or your second check, the IRS can use information you already provided in order to determine eligibility and deliver your third payment..

That means you will not have to take any extra steps, in most cases, to claim your money this time.

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11. Most people don't have to do anything to get their money -- but some do

Because this is the third payment the IRS has delivered, the agency has information about most eligible Americans. That means the payment should be delivered seamlessly without any action required on the part of most recipients.

However, there are a few exceptions.

If your income was too high in 2019 for you to be eligible for a payment but you qualify based on your 2020 income, you'll want to file a 2020 tax return as soon as possible so the IRS knows you're entitled to receive the third check.

If you have a new dependent in 2020 that wasn't declared in 2019, you'll also want to submit your return quickly to avoid missing out on the $1,400 for that dependent.

ALSO READ: How to File Your Taxes: A Beginner's Guide

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Person sitting at table with laptop while smiling and looking at phone.

12. You can check the status of your check online

If you want to find out where your third stimulus payment is, the IRS has made that easy. Visit the IRS Get My Payment tool and provide your Social Security number, date of birth, street address, and ZIP code.

If your payment has been processed, you'll see its status including when and how it was (or will be) delivered. If you see Need More Information, then your payment was returned to the IRS so you must provide bank details so they can resend it. And if you see Payment Not Available, either you aren't eligible for one or the IRS hasn't begun processing it yet.

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Two adult hands cupping two tiny baby feet.

13. If you have a baby this year, you'll be eligible for another check

If you have a new baby this year, that child will count as a qualifying dependent and you will be entitled to another $1,400 payment for that baby. However, you most likely will need to wait until you file your 2021 tax return and declare your new dependent in order to get the funds.

ALSO READ: If You're Expecting a Baby This Year, You Could Get Another Stimulus Check

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Rising stacks of coins with blocks atop spelling out Debt.

14. It’s possible you could lose your check to debt collectors

The second stimulus check was shielded from private debt collectors, but the third payment is not.

Lawmakers wanted to provide protection for it but couldn't do so due to the process used to pass the bill. This could mean you're at risk of losing your money if it's deposited to your bank account and a collector has a garnishment order.

Some lawmakers are working to pass legislation to stop this at the federal level, and some states have put protections in place already. But as of right now, many people do face this risk since there aren't uniform protections nationwide.

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U.S. Capitol Building

15. The third stimulus payment will most likely be the last one

It's likely the third stimulus payment will be the final one that Americans receive. While the first two coronavirus stimulus bills received bipartisan support, the legislation authorizing the latest check received only Democratic votes.

Since Republicans weren't on board with the American Rescue Plan Act, they most likely wouldn't vote for a fourth check unless there's a dramatic change in economic conditions.

Without their support, Democrats would need to use the same process -- called reconciliation -- that was used to authorize the third check. That process can be used only a limited number of times, though, and most likely will now be used for other Democratic priorities instead of a fourth check.

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A gift box wrapped in money and a bow.

Make sure you understand the details of the third check

It's important to understand when and how the third stimulus check will be delivered, the rules for eligibility, and the steps (if any) that you need to take to claim your money.

Now you know the details, you're better prepared to ensure you get the full amount you're due and use it wisely.

The Motley Fool has a disclosure policy.

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