You could soon receive the third stimulus check in your mail. That is if it has not already been credited to your bank account. And if you happen to be above 65 years, you need to know the rules that affect you. You should be familiar with the rules of qualification, SSDI, SSI, income, and retirement. What should you do if you haven’t received Economic Impact Payment though you qualify for the $1,400 direct cash payment? And finally the steps you have to take to recover the stimulus amount of the two checks that were paid in 2020.
The Third stimulus check is part of a $1.9 T economic package, The American Rescue Plan signed by President Biden on March 11. If you are over 65, are a veteran, or collect Social Security benefits, you have reasons to smile. You can expect a check if you haven’t already done so. And here is how you can track the third stimulus check.
Factors Affecting Your Third Stimulus Check
The amount in the third stimulus check depends on the number of dependents you are claiming for this year. You could also be claimed as dependent as an older adult. The income limits declared by the IRS are also a factor that determines what you get. We are bang in the middle of the tax filing season, so that is also a determining factor.
Factors include the adjusted gross income, your Social Security benefits, and your tax returns. Other determining issues are whether you have a dependent or someone declares you as one. And if you have missed out on the first and second stimulus checks, you can claim it in your 2020 income tax returns under the Recovery Rebate Credit. Here is the latest update.
If you have crossed 65 by 2020, you will be considered as a senior citizen for calculating their taxes. You are 65 a day before you turn 65.
Criteria For Qualification For The Third Stimulus Check
The rules were a bit different from the previous round of the stimulus payments. Your eligibility for the stimulus check, and the size of the payment, rested on if you were a dependent by law. It also hinges on your AGI (Adjusted Gross Income) from the 2019 tax returns.
Your AGI could be affected by your taxable investments or if are a pensioner, thereby affecting the eligibility for the stimulus check. Other factors are interest earned from a bank account, though interest earned from bonds that are tax-exempt will not be calculated. It isn’t part of your AGI. The rules are a bit different for the third stimulus check. Read on.
Amount In The Third Stimulus Check
For the third stimulus check, everyone can be counted as a dependent for the $1,400 payment and that adds to the household total. You could be a college student or an adult dependent. It will only add to the total check amount the household will receive.
This will take care of the 13.5 million elderly dependents, as put out by the People’s Policy Project.
For the first time, you will also be a beneficiary if you qualify as a member of a family having ‘mixed-status citizenship.’ Here members of the same family might have dissimilar immigration status. This group number 16.2 million, but was excluded from the first two stimulus payments. At least one member of a qualified family should have a Social Security number.
But the third stimulus check is also more focused. Individual tax filers earning below $75,000 qualify for the full amount of $1,400. But if you earn more than $80,000 per year, you will not receive any payment. Some other beneficiaries have been added to the list.
If you are over 65 and receive Social Security Disability Insurance or Supplemental Security Income, you are eligible for the third stimulus check-in line with the first two stimulus payments.
How Does One Calculate Adjusted Gross Income?
Your Adjusted Gross Income is the key to determine your third stimulus check. It is calculated based on your latest tax filings. It is the amount from your total income that is taxable by the IRS.
Your income in a year from wages, capital gains, interest income, dividends, alimony, royalties, retirement distributions, and rental income are your gross income.
Your AGI or taxable income is the allowable deductions allowed on your gross income. They may include alimony payments, student loan interest, and retirement contribution. It is the decisive factor for how much the authority owes you, plus the number of your dependents and your filing status, whether joint or single.
What Is The Situation For Senior Dependents?
As an older citizen, you might be claimed as a dependent by a relative in their tax filings. This could happen if you reside with your kids. To claim the third stimulus check, the primary tax filer would have to declare you as a dependant on tax form 1040.
The criteria for qualifying relatives are that they don’t count as child dependent. They should live with their family all year round or should be close relatives, even if they don’t live together (like parents or grandparents). The gross income should be below $4,200, and they should have above 50% of the support come in from their family member. The Form-1040-SR, US Tax Return for seniors was introduced by the IRS for senior citizens.
Is Citizenship A Factor?
In some cases, non-Americans who pay their taxes will qualify for the third stimulus check. Unlike in the initial round, non-US citizens were denied the second stimulus payment of $600. But every non-US citizen was eligible for the stimulus payment if they had a Social Security number under the CARES Act, March 2020. This included resident aliens; people with H-1B and H-2A visas and green cardholders.
Relation With Tax Filing
If you claim stimulus payments from the first two rounds, you will have to file your 2020 taxes along with a Recovery Rebate Credit.
If you are above 65, you have to file returns if your gross income is above $13,850 as an individual ($20,000 in case of a family).
if you are married, one of you is over 65 and filing jointly, you will need to file returns if your gross income is above $25,700 and above. If both are above 65, you have to file if your gross income is above $27,000. Qualifying widow or widower earning $25,700 or more and aged 65 or above must file returns.
If you are 65 or more with a dependent child and qualified for $500 more under the CARES Act, or received $600 as part of the second stimulus bill, you will need to claim the stimulus check for dependents by filing an RRC.
Which Seniors Received The Previous Checks?
Retired railroad employees and recipients of Social Security qualified for the initial two rounds of payments; so did SSI and SSDI recipients who received the benefits automatically. Included are also those who receive payments from the Veteran Affairs department.
Those citizens who are members of the SSDI scheme must also have qualified for the first two rounds of stimulus payments. For those who did not receive their checks, you will have to file returns and claim them as an RRC. However, older adults claimed as dependent weren’t eligible for the first round of payments.
