Everything important you need to know about stimulus checks today

Congress is rushing to approve President Joe Biden’s $1.9 trillion COVID-relief proposal, laying the groundwork on Friday to speed up passage of the bill using a legislative tool called budget reconciliation. The maneuver could remove barriers to approving the bill, speeding up the timeline to send a third stimulus check.

Since proposing the $1,400 check amount in January, Biden hasn’t wavered his support for the dollar amount, despite a pitch this week by Senate Republicans on a bipartisan deal for a $1,000 payment. “I’m not cutting the size of the checks” Biden said Friday. “They will be $1,400, period. That’s what the American people were promised.” Biden may take a page from the Republican plan, however, that could limit who would get the new, more “targeted” stimulus check.

While a third stimulus check is under debate, some are still waiting for money from the first or second payments — we’ll explain how to claim that as a tax credit. We’ll also tell you what you need to know about how some rules have changed (around garnishment, for example) and when it’s time to file a payment trace for your missing money. Below, we’ve broken down the most important stimulus check facts and developments right now. This story was recently updated. 

Republican $1,000 checks are dead, but Biden’s $1,400 check could borrow some ideas

Ten moderate Senate Republicans on Monday pitched a bipartisan plan (PDF) on COVID-19 relief. But after the two-hour meeting, the White House later released a statement saying, “While there were areas of agreement, the President also reiterated his view that Congress must respond boldly and urgently, and noted many areas which the Republican senators’ proposal does not address.” 

The GOP plan proposed dropping some of Biden’s funding projects to hit the $600 billion budget goal, and that included reducing the amount of stimulus checks to $1,000 and lowering the upper income limit to receive a payment.

The Washington Post reported, however, that administration officials are considering applying the Republican idea of a lower income limit in their proposal to “target” the payments to middle- and lower-income individuals and families, which means the checks would go out to fewer people overall than if Congress did nothing to change the current stimulus check formula.

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Stimulus check No. 3: What you need to know

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Here’s how Democrats would approve checks faster

On Monday, House Speaker Nancy Pelosi and Senate Majority Leader Chuck Schumer filed for a joint budget resolution, which is a first step toward using budget reconciliation, a tool used to speed up legislation by bypassing objections in both the House and Senate. And on Friday, both houses approved the budget framework for the bill. This would make it possible to pass Biden’s stimulus package in both chambers with just a simple majority of votes. 

Tax season 2020 is big for stimulus checks, even if you don’t usually have to file

February also marks the start of tax-filing season, which carries extra weight for those who qualify for the first, second or potentially third stimulus checks — and that’s whether you are required to file taxes or not. The IRS uses the federal tax system to decide things like how much money you should get in your stimulus checks (based on your AGI), how quickly it can send your next payment and even if you should get a catch-up payment (it’ll be faster if you set up direct deposit with the IRS and do your taxes soon).

If your first or second payment haven’t arrived, or if any amount is missing, the IRS will use your 2020 taxes to reconcile the difference — but only if you file for a Recovery Rebate Credit as part of a tax return. Again, that even applies to non-filers, people who aren’t typically required to file income tax. Here’s our primer on everything stimulus check and taxes. 

One more thing: If you got a letter from the IRS saying the money was sent, but you never got your funds, you may need to set up a payment trace rather than use the IRS’ rebate credit.

A third stimulus check could get sent out quickly

It took exactly nine months to get from the signing of the CARES Act (March 27, 2020) to the December stimulus bill (Dec. 27, 2020). Even before taking office, Biden has been bullish about Congress passing another COVID-19 relief package — one that includes a third stimulus check for up to $1,400. Biden and congressional Democrats want to see the third injection of funds sooner rather than later. 

With passage of the funding framework on Friday, House and Senate committees are working together to build out the bill. But before it goes to the floor, lawmakers will have to make sure the bill meets the strict rules of what can be allowed through budget reconciliation — for example, while a third stimulus check would likely be allowed, raising the minimum wage could be outside the requirements. 

Once an agreement on a bill is reached, checks could be sent out quickly, now that the IRS has its system in place after the first and second checks. Here’s the current stimulus check timeline as we know it now.

More people could qualify for a third stimulus check, but fewer could, too

Whether the third stimulus check winds up having a per-person maximum of $1,400 or some other amount, as long as it’s more than $600 and uses the same income limits (and that could change), more people could qualify (handy chart here) if Congress doesn’t alter any eligibility requirements. 

That’s because there’s an income limit that’s part of a mathematical formula used by the IRS after which point you can’t get any money. That some-money threshold goes up when the per-person maximum goes up. So, more people are eligible for some stimulus money with a $1,200 check than with $600, and so on.

However, if Congress lowers the income cap to qualify for a payment, checks could go out to fewer people who are over the lower threshold.

In addition to setting up a larger check with a possible lower income cap, Biden’s stimulus proposal also seeks to include two more groups of people: dependents of any age and families with mixed-status citizenship (that means some members are not US citizens).

Will any amount of the payment be retroactive for mixed-status families who were barred from claiming the first and second check? That’s one question of many that isn’t determined.

Your stimulus check rights improved with the second round — for the most part

Usually, stimulus dollars are yours to spend or save as you please. You can’t be compelled to spend your proceeds on rent, car payments, back taxes or debt — or even unpaid child support. But the second check that went out last month changed some of the rules.

The government’s Taxpayer Advocate Service, which works with the IRS, has pointed out that anyone claiming a Recovery Rebate Credit for catch-up stimulus money is not automatically protected from garnishment.

It isn’t clear how a third check would play into the mix. And there is still an exception that allows at least one entity to garnish your stimulus money. Make sure you know your stimulus check rights.

The stimulus check rules and exceptions can get very confusing

With stimulus checks, small details and exceptions can be dizzying. While some situations are easy to decipher, others concerning you and your dependents might make it unclear if you’re eligible, how much money you could receive and if there’s anything extra you have to do to claim your money.

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