As of 2020, there have been three rounds of Economic Impact Payments (aka Stimulus Checks) issued due to the public health crisis and resulting economic dilemma.
The three different direct relief payments were authorized by:
- The (Coronavirus Aid, Relief, and Economic Security) CARES Act: Passed by Congress on March 25, 2020, and signed into law on March 27, 2020.
- The Coronavirus Response and Consolidated Appropriations Act: Passed by Congress on December 21, 2020, and signed into law on December 27, 2020.
- The American Rescue Plan: Passed by Congress on March 10, 2021, and signed into law on March 11, 2021.
Most people are receiving the money through direct deposit or paper checks. If you have not received anything, you can check your status on the IRS’ Where’s My Refund? Page. If you are a nonfiler eligible for payments, you must file a tax return in order to receive the stimulus payment. For more information, go to the 2020 Recovery Rebate Credit page.
How much was each stimulus check?
Each stimulus check ranged from $600 to $1,400 per adult and $500 to $1,400 per child.
Stimulus check eligibility: In order to receive the full amount of the payments, your adjusted gross income (AGI) cannot be more than:
- $150,000 for a joint return,
- $112,500 for head of household
- $75,000 for single and other eligible individuals
How much was the first stimulus check?
The first stimulus check was $1,200 per adult and $500 per child.
‘‘(1) $1,200 ($2,400 in the case of eligible individuals filing a joint return), plus
(2) an amount equal to the product of $500 multiplied by the number of qualifying children (within the meaning of section 24(c)) of the taxpayer.”-SEC. 6428. 2020 RECOVERY REBATES FOR INDIVIDUALS (CARES Act)
The first stimulus check was sent out starting around April 11th, 2020.
How much was the second stimulus check?
The second stimulus check was $600 per adult and $600 per child.
‘‘(1) $600 ( $1,200 in the case of eligible individuals filing a joint return), plus
(2) an amount equal to the product of $600 multiplied by the number of qualifying children (within the meaning of section 24(c)) of the taxpayer.”-SEC. 6428A. ADDITIONAL 2020 RECOVERY REBATES FOR INDIVIDUALS. (Consolidated Appropriations Act)
The second stimulus checks got sent out starting around December 29th, 2020.
How much was the third stimulus check?
The third stimulus check was $1,400 per adult and $1,400 per child.
“(1) $1,400 ($2,800 in the case of a joint return), plus
(2) $1,400 multiplied by the number of dependents of the taxpayer for such taxable year.”-SEC. 6428B. 2021 RECOVERY REBATES TO INDIVIDUALS. (American Rescue Plan)
Individuals and families that made less than but not over the following amounts could receive a partial stimulus check:
- $160,000 for joint filing
- $120,000 for head of household
- $80,000 for single and other eligible individuals
The third stimulus check got sent out hours after it was signed with an official payment date of March 17th; however, some individuals received it earlier from their bank.
How should I spend my stimulus check?
Millions of people all over the world were affected by this health crisis. It came out of seemingly nowhere and lasted far longer than anyone could have expected. Though things are slowly getting better, we are not completely out of the woods yet.
The economic relief payments received so far have been a help to some struggling families and a bonus to others who managed to get by easier. So… what should you do with the stimulus check?
There are various smart things to do with the stimulus checks. Use them to:
- Help buy necessities: It may be smart to also start buying these essentials (like toilet paper) in bulk. Just be considerate and don’t hoard.
- Build an emergency fund: Use the checks to build, rebuild, or increase your emergency fund. As we’ve seen, you never know what can happen and it’s best to be prepared.
- Pay off debt: Lower your monthly bills and free up available cash by paying off debt. Using either the snowball or avalanche method is effective.
- Support local businesses: Many businesses have shut down or been on the verge of it due to the public health crisis. If you have the money to spare, it would be generous to support them by shopping locally.
- Invest: Use the money to invest in yourself whether it’s starting your own business venture or saving towards retirement.
- Donate: Another great option is to donate part or all of your stimulus money to local charitable organizations and food banks.