Here's What You Need to Know About Stimulus Debit Cards

Some people will get their $600 stimulus in debit card form. Here are the details.

After months of fruitless negotiations, lawmakers finally settled on a $900 coronavirus relief bill to follow late March's CARES Act. The bill was officially passed into law at the end of last year. It includes, among other provisions, rental assistance, boosted unemployment benefits, and a second round of direct stimulus payments worth $600 apiece.

Most recipients with bank account details on file with the IRS will receive their money via direct deposit, similar to the first round. But others, including those without bank account details on record, will need to either wait for a physical check to arrive in the mail, or wait for a debit card. Here's what you need to know about the latter.

It's not spam

During the first round of payments, some recipients tossed out their stimulus debit cards thinking they were junk mail. If you get a debit card -- also called an Economic Impact Payment Card -- this time around, don't trash it.

Look out for a plain white envelope that says “important information about the Economic Impact Payment." It will have the U.S. Treasury seal and say “Economic Impact Payment Card” in the return address.

That card will contain up to $600 for you to spend however you please. Like other debit cards, you'll need to activate your card before you can use it. You'll probably need to create a pin for your protection as well.

You may get a debit card even if you previously received a check

For some reason, issuing debit cards helps the IRS get stimulus payments out to the public sooner than sending everyone a check. As such, you may receive a debit card this time -- even if you got a check during the first round.

You should have flexibility with your card

The debit card you receive should be accepted anywhere Visa debit cards can be used. For example, if you want to buy groceries, you should be able to swipe that card at checkout. Similarly, that debit card should work online or to make purchases by phone. You'll also be able to use your debit card to withdraw cash for free at an in-network ATM (look for the AllPoint logo), or transfer the money to a bank account. However, if you attempt to withdraw cash from an out-of-network ATM, you may incur fees. The same holds true if you attempt to use your debit card outside the U.S.

Your card might expire

The stimulus funds on your debit card will never expire, but your card itself might. If that happens, you'll need to call the IRS to either transfer the funds to a new card or get a check. That said, since so many Americans desperately need their stimulus cash, you'll likely spend yours well before the card becomes invalid.

Read the agreement

Your new debit card will come with instructions and an agreement spelling out the rules involved. Read through that information so you know what to expect and how to make the best use of your stimulus cash.

We don't know if another round of direct stimulus payments will be on the table later in 2021, so it pays to spend your current stimulus carefully. That means using your funds for food and essentials before blowing that money on things you don't need. Of course, if you're in a great spot financially and your stimulus is really just bonus money, you could always sock it away for retirement or invest it. But unfortunately, a large number of people will need that money just to get by.