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Here are some things that could get in your way of receiving a third direct stimulus payment.
Congress has yet to put the finishing touches on a third direct stimulus payment to the American public, but enough details have leaked to give us a fair idea of what we can expect this time around. If you're one of the millions of Americans who need a fresh influx of cash to pay your bills, this check matters to you. Take a quick look at these four issues that could prevent you from receiving a direct payment and decide what you want to do about anything standing in your way.
1. You've moved
If you haven't filed your 2020 tax return yet, the only address the IRS has for you is the one listed on your 2019 return. If you opted to have a 2019 tax refund direct deposited into your bank account and still have that account, you should be fine. The IRS will make the next direct payment deposit into the same account. However, if the IRS mailed a paper check or debit card to your old address last time, they're going to mail another paper check or debit card this time -- to the old address. You can rectify the situation by:
Filing your 2020 tax return as soon as possible. Your latest return will give the IRS a record of your new address. Also, if you earned less in 2020 than in 2019, it could be easier for you to qualify for this round of direct payments.
Download Form 8822 from the IRS website. Once you fill out the change of address form, mail it to the address listed on the form.
Inform the IRS in writing. If you don't have access to a printer or would rather write a letter, let the IRS know you've moved by providing the following information:
Your full name
Your old address
Your new address
Your Social Security number or Individual Taxpayer Identification Number
Your signature
If you filed a joint return in 2019, provide all required information and signatures for you and your spouse.
2. You've changed banks
Whether you've moved residences or not, you may have changed banks since the last time the IRS deposited a tax refund. If so, the new direct payment will be sent to the last bank on record. By law, banks must return payments sent to closed accounts back to the IRS.
Your best bet may be to get your 2020 tax return filed as quickly as possible (provided you have all the documentation you need to file an accurate return). If that's not possible, file for a Recovery Rebate Credit when you fill out your 2020 return. If you're owed a refund, the IRS will add the amount of the direct stimulus to your refund. If you owe taxes for 2020, the IRS will deduct the amount of the stimulus check from the total taxes due.
3. Your marital status has changed
If you and your spouse have separated or divorced since the last time you filed taxes, and now live in separate residences, the IRS needs to know. If your last direct payment was mailed to your home and one of you still lives in that residence, that's where the stimulus check will be mailed. If that's your ex, quickly let the IRS know that you live somewhere new.
4. You didn't qualify in 2019, but do now
Although it's not written in stone, it looks like this round of direct payments will be similar to the first two rounds. Here's a breakdown of who would receive a full stimulus payment of $1,400 per eligible family member:
Filing Status
Adjusted Gross Income (AGI)
Single tax filer
Up to $75,000
Head of household
Up to $112,500
Married couple filing jointly
Up to $150,000
Let's say you are single and earned $100,000 in 2019, but COVID-19 caused your business to close for a time and you ended up with an AGI of $60,000 in 2020. If you haven't filed your 2020 tax return yet, now is the time to do it. There's no reason to miss out on a direct stimulus payment if you need it but don't qualify because the IRS is using an older tax return to determine eligibility.
Congress is still hammering out the details, like how much Americans earning more than these limits might receive and at what income they are no longer eligible for any funds. We know that the upper limit will likely be lower this time around than it was when the first two stimulus payments went out, but are still waiting for lawmakers to settle on an amount.
In the meantime, if any of these four issues apply to you, take steps to rectify them before Congress passes the stimulus proposals into law and the IRS begins sending checks out the door. And if your finances were hit hard by the pandemic, visit our coronavirus hardship loan guide to learn if you might qualify for a hardship loan.
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Dana has been writing about personal finance for more than 20 years, specializing in loans, debt management, investments, and business.
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By: Steven Porrello |
Updated
- First published on Sept. 29, 2023
Withdrawing money from your checking or savings account may not seem like a suspicious activity. After all, it's your money. Even if it's a large amount, like $10,000, who's to say withdrawing it would call for an investigation?Turns out, withdrawing $10,000 or more from your checking or savings will prompt your bank to file a report with the Financial Crimes Enforcement Unit (FinCEN). It sounds more serious than it actually is, but if you withdraw $10,000 frequently enough -- or worse: break up $10,000 into smaller withdrawals -- you could find yourself under legal scrutiny. To avoid any problems with FinCEN, here's what you should know.Why banks report withdrawals of $10,000 or moreEver since the Bank Secrecy Act of 1970, banks have been required to report any transaction involving $10,000 or more to the federal government, whether it's a cash deposit or a withdrawal. Often, a bank's software will automatically file a Currency Transaction Report (CTR) electronically for transactions that exceed $10,000, even if you're not aware of it.Though it might seem like a violation of your privacy, the Bank Secrecy Act helps the federal government track and prevent financial crimes, like money laundering. When banks fail to report large cash transactions, criminal and suspicious activities can fly under the radar. For instance, between 2004 and 2007, the bank Wachovia -- now a part of Wells Fargo -- allowed about $400 billion in drug cartel money to flow through its banks largely because it failed to report transactions to the federal government.When a $10,000 withdrawal can become a problemTo be clear, a $10,000 withdrawal isn't a criminal activity per se. In fact, FINCen likely receives so many uninteresting CTRs a day, you won't trigger suspicion through a large withdrawal alone. But there are some activities that will put greater vigilance on your bank account. The most common is called structuring.Structuring involves breaking up a large cash transaction, like a $10,000 withdrawal, into smaller parts specifically to evade the Bank Secrecy Act's reporting requirements. For instance, if you withdraw $12,000 in total from your checking account, but break it into three $4,000 withdrawals, the transaction might be seen as structuring.Of course, you could have good reasons for making a series of withdrawals totaling $10,000 or more. But if you do it frequently enough, your bank could report it as suspicious activity. Once flagged, structuring can embroil you in a legal investigation. At that point, if you're caught intentionally evading a bank's reporting requirements -- even if you're just a private person who doesn't want the government keeping tabs on your life -- you could face criminal or financial charges.How to safely (and legally) withdraw $10,000 or moreThe best way to withdraw $10,000 or more is to simply do it. Don't try to break it into smaller installments, or get smart and Venmo your friend half and have them withdraw it for you. If you don't want your activities tracked, don't do anything suspicious that will make your bank report it to FINCen.Truthfully, unless you are engaging in something illegal, you have nothing to worry about. FINCen knows large withdrawals and deposits happen everyday, and it's not concerned with legal cash flows. It's only when you behave suspiciously that you could find yourself under investigation.If you're concerned, you can always talk to your bank. Otherwise, just keep withdrawing as you normally would, and you won't run into any serious financial problems.
By: Emma Newbery |
Updated
- First published on Aug. 7, 2023
Are SNAP benefits enough?A monthly payment of $973 for a household of four equates to around $8 per person per day. While SNAP benefits aren't designed to cover everything, it isn't easy to feed a family on around $2.66 per person per meal. Indeed, research from the Urban Institute showed that the maximum benefits often don't cover a family's food costs. "Amid inflation, SNAP benefits did not cover the cost of a meal in 99 percent of counties in 2022," said the report.The new benefit amount -- a monthly increase of $34 for a household of four -- is roughly in line with cost-of-living increases measured by the Bureau of Labor Statistics (BLS). Its latest Consumer Price Index figures show that the cost of all items in June, 2023 was up 3% over the year before. However, inflation does not impact all aspects of life equally.The BLS data also shows that food at home increased by 5.7% year over year. The new SNAP benefits do not match this. Hypothetically, a 5.7% increase in benefits for a family of four would mean a new monthly payment of $992, rather than the planned $973.In addition, this year brought the end of the pandemic-era emergency food benefits throughout the country. According to CBPP calculations, this meant the average person received about $90 a month less in SNAP benefits. Even factoring in the increased SNAP benefit amount, many households have seen a significant drop in their food benefit amount, and the revised 2024 payments will do little to close this gap.How to make your SNAP benefits go furtherIt can take time and energy to provide healthy food for your family on a strict budget. The challenge is that in a busy household, time and energy are also limited resources. Even so, if you can carve out some time to plan your grocery-shopping trip, it can make a big difference.Here are some ways you might stretch your SNAP benefits a little:Use cash back apps and coupons: Look for cash back apps that work in stores that take your EBT card. You'll usually need to download an app and then scan your receipt after you've been to the store. Pay attention to coupons, whether in store or online as these can often carry hefty discounts.Always shop with a list: Planning your food shopping is one of the best ways to reduce costs. Even more so if you use a cash back app or coupons. Check what offers are available on items you normally buy before you go shopping. Mark the items that qualify for rewards or discounts on your list, so you don't miss them when you're shopping.Look for double up programs: There are Double Up Food Bucks or other programs in various states that essentially give you two for one on all produce at participating farmers markets and stores. It's a great way to get more fruit and vegetables for your SNAP dollars.Buy in bulk and batch cook: It isn't always easy to find the extra cash for bulk buying when you're eking out every cent. However, if you can manage it, you may be able to save both money and time. You might, for example, batch cook a stew and freeze portions for future meals.Unfortunately, food insecurity still impacts many American households. If you don't have enough money to feed your family this month, look for additional help. Find out what food pantries and soup kitchens are operating in your area on which days, and whether you'll need to present any documents. Call United Way at 211 for information about assistance programs in your area.
By: Maurie Backman |
Updated
- First published on Sept. 13, 2023
At some point in 2022, I discovered Aldi and began shopping there weekly. I found that I was able to save money on my grocery bill by purchasing certain produce items there. And since I happen to have an Aldi adjacent to my local Costco, it wasn't particularly out of my way.But over the past few months, I've become less enamored with Aldi. Here's why.1. The selection is just too limitedAldi -- at least near me -- is a minimally stocked grocery store. The shelves aren't loaded the way they are at my nearby ShopRite and Stop & Shop.To be fair, this was the case when I first started shopping there. But because there's just not a lot of selection, I'm generally limited to only buying a few items when I pop into Aldi.Not so long ago, I was running into Aldi for some fruit, which I usually buy there, and I needed to grab shredded cheddar cheese. Normally, I get that at Costco, but I didn't want to run next door to Costco and wait in a line for cheese alone. Unfortunately, though, Aldi didn't have the cheese I needed, so I had to make an extra stop anyway.2. The inventory is too inconsistentNot only is there a limited selection of food items I can buy at Aldi, but sometimes, I can't even find the five or six things I'm looking for. Aldi was once my go-to source for avocados, since it's an expensive purchase and Aldi tends to sell them for less than Costco (at least in my area). But the last few times I stopped at Aldi, avocados weren't in stock.And that's happened to me with other things, too. Over the past several months, I've struggled to find everything from cucumbers to strawberries at Aldi as well.3. What the store saves me on groceries, I lose via lost working hoursShopping at Aldi still has the potential to save me a little money on groceries. At a time when supermarket prices are up 3.6% on an annual basis, that helps.The problem, however, is that even though Aldi is right near Costco in my neighborhood, thereby allowing me to combine those trips, it still takes time to visit an extra supermarket. I have to find parking, wait in a checkout line, and spend time searching the shelves.While it's nice to save $2 here and $3 there, the reality is that a stop at Aldi might cost me 20 or more minutes of work -- especially when I don't manage to find the things I need. And losing out on that work time often means forgoing more than $2 or $3 of income. So from a time perspective, it's just not worth it.Shopping at Aldi could make sense for a lot of people. If you're someone with flexibility in your schedule and grocery list, and you're not so picky about the brands you bring home, then it could pay to spend the time visiting Aldi, even if you don't always manage to find all the things you need. But I've reached the point where shopping at Aldi makes less and less sense for me, so I'll most likely stop going there unless it's a one-off basis.
By: Steven Porrello |
Updated
- First published on Sept. 20, 2023
Again, if you buy the laptop in-store at a Costco warehouse, you might get a lower price than from its online store. This is especially true as holiday sales approach, like Black Friday, which might see electronics and laptops discounted.2. Generous return policy and two-year warrantyCostco will let me return a new Macbook Pro for a full refund within 90 days after I purchase it. Even better, Costco will accept my return even if I don't have the original box. For comparison, Best Buy will give you 15 days to return a MacBook (60 days if you're a My Best Buy Plus member), while Amazon will also give you 15 days.Not only that but Costco will extend the manufacturer's warranty to two years, giving me two years of coverage for mechanical or electrical failures. And if that wasn't enough, it also sells AppleCare+ at a slightly cheaper price than other retailers: $319 for a three-year insurance policy. In contrast, Apple, Amazon, and Best Buy all sell the same policy for $399.3. Free technical and troubleshooting supportLastly, buying a MacBook through Costco means getting free technical support through its Concierge Service. This could really come in handy if you're working on a deadline, your Macbook suddenly stops working properly, and you don't have time or energy to figure out a solution on your own.Even better is that you get technical support indefinitely, whereas other retailers, like Apple, will give you support for a set amount of time, like 90 days.Low prices + support + 2% back = why I'm buying my Mac at CostcoAll in all, I'll buy my 16-inch Macbook Pro from a Costco warehouse when I can get it for a discounted price. Cost is a major factor in my decision (I can't blow my personal finance goals for a new laptop). But so is the return policy, technical support, and one-year extension on the manufacturer's one-year warranty. Plus, I get 2% back with my Costco Executive membership, which is about $50 back on a $2,249 Macbook Pro.True, it's important to compare that with other retailers to see who has the best deal, but if you're a Costco member, you might not find a better value when in-store laptops are discounted.
By: Maurie Backman |
Updated
- First published on Sept. 20, 2023
Many people flock to Costco to load up on low-cost groceries and household essentials. But the warehouse club giant sells a lot more than just bulk breakfast cereal and paper towels. You can find everything from apparel to electronics to furniture at Costco. And it could also be a good source for buying gift cards.That said, Costco's gift card offerings may not meet your needs. So it's important to be mindful of these points if you're looking to purchase gift cards at Costco.1. Event gift cards might come with restrictionsCostco sells gift cards to different events. Right now, for example, you can buy gift cards to cover tickets to NASCAR races and NCAA games. And in the summer months, you can often find tickets to Major League Baseball games.But when you buy event gift cards, you're often limited to specific dates. And those may not align well with your schedule. Always read the fine print before buying a Costco gift card that you're going to redeem for event tickets.2. The selection may be limitedThe selection of gift cards you'll find at Costco can be hit or miss, depending on your local store. If there's a specific gift card you're looking for, don't bank on getting it at Costco -- even if you've seen it there before. You may have better luck at your local pharmacy or supermarket.That said, you'll generally find more options for gift cards on Costco.com than in stores. And in many cases, when you buy your gift card online, you'll get it emailed to you so you have access to it right away.3. You may not find the denomination you want One major benefit of buying gift cards at Costco is that you'll often find them priced below face value. For example, you might spend less than $100 for $100 worth of gift cards to a certain restaurant. But one hiccup you might run into is struggling to find a gift card in the exact denomination you want.Let's say you want to give your child's teacher a $35 gift card to IHOP during the holidays. Costco sells a four-pack of $25 IHOP gift cards for $79.99, which is a great deal since that would normally cost you $100. But it also leaves you in a jam if you want to give a $35 gift card and you don't want to go under or over. A $25 gift card may not be enough for that teacher and a friend or partner to share a meal. But $50 (two $25 gift cards) may be more than what you're looking to spend.Buying your gift cards at Costco could result in a lot of savings. But before you gear up to buy gift cards at Costco, be mindful of these potential issues. Also, have a back-up plan if you're buying a gift card to hand over as an immediate gift. That way, you're not left in the lurch.
