American Rescue Plan Act Economic Payment Information for Consumers
On March 12, 2021, Congress passed and the President signed legislation for the American Rescue Plan Act of 2021 that authorized the IRS to distribute Economic Impact Payments (EIP) to eligible individuals. The relief package is intended to provide assistance to American consumers and businesses struggling as a result of the Coronavirus Pandemic. The IRS has begun sending payments via automated clearing house (ACH) payments and many consumers are seeing them deposited into their accounts. If you filed taxes in 2019 or 2020 and included your bank routing and account numbers for payments or refunds, and this information has not changed, the IRS has the information it needs to send your payment electronically. Recipients will be mailed a check if the IRS does not have your information on file. Check payments will follow weeks or possibly months after the direct deposits are sent.
With the third round of stimulus payments, adults and dependents may receive up to $1,400 each. The payments begin to phase out at $75,000 for single filers, $112,500 for head of household filers, and $150,000 for married filing jointly. Households earning more than $80,000 for single filers, $120,000 for head of household filers, and $160,000 for married filing jointly will not receive any payment. For complete eligibility information please visit the IRS website.
Some college students may be eligible to receive an Economic Impact Payment. Dependent college students who can be claimed on someone else’s tax return as a dependent will not receive the payment directly, rather the person claiming them on their tax return will receive the payment. College students who are financially independent and provide more than half of their own financial support, may qualify for a payment depending on where they fall in the income thresholds established by the IRS.
Those who did not file a 2019 or 2020 tax return and did not register with the IRS.gov non-filers tool last year may still be eligible for a payment if they meet all of the eligibility requirements outlined by the IRS. It is recommended that they file a 2020 tax return and claim the Recovery Rebate Credit. People who typically do not file a tax return and are not Social Security beneficiaries will need to file a simple tax return to receive an economic impact payment.
If you have not received your payment by the time you file your 2020 tax return, you can claim the Recovery Rebate Credit on your tax return. Most online tax software will also help you to calculate and claim any previous stimulus payments you may not have received.
For more information about Economic Impact Payments and the 2020 Recovery Rebate Credit, visit IRS.gov/eip or consult a tax advisor.Back to Blog >