First and second stimulus checks made simple-ish: 9 things everyone should know

What do you know about stimulus checks, other than that a second payment hasn’t been announced yet? Many unanswered questions remain about what’s happening with negotiations (we’ll update you daily), when a second check could realistically come  (we mapped out when it could arrive depending on who you are) and how eligibility could change with a second check (we have some clues).

We’ve sifted through the stimulus bill proposals, the IRS websites and watched a whole lot of C-Span seeking answers to pressing questions about the first stimulus payment… and the second check that’s been under debate almost since the moment the first checks started being delivered in mid-April.

While we don’t have every answer for you, we can help explain in broad strokes what you might not know about how the IRS calculates your total sum and everything the payment has to do with your taxes, your kids — even if you’d receive your check weeks before or after your extended family and friends. Read on! (We frequently update this story with new information.)

1. The status of negotiations changes day by day

House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin continue to talk this week on the White House’s Oct. 9 $1.8 trillion offer, which includes another direct payment for up to $1,200 for individuals, as well as a change in the status of dependents (more below). In parallel, Senate Republicans are prepping to vote on a new standalone bill to refund the Paycheck Protection Program on Oct. 19 — it would not include a stimulus check.

While Mnuchin said Wednesday he isn’t confident that a larger stimulus bill will pass before the Nov. 3 election, talks have been considered “productive.” Here’s more about the state of negotiations.

2. How the IRS calculates your stimulus payment

Did you know that in some cases you can still get stimulus money if you have kids, even if your family’s yearly earnings exceed the income limit? 

The language of the CARES Act isn’t particularly easy to follow, but to calculate your total, the IRS essentially lumps together your household’s total adjusted gross income and adds on the money allotted to qualifying dependents and then starts deducting from the total, based on your income bracket as defined by the CARES Act.

You can calculate your estimated stimulus check total now (including for a second check), but the bottom line is that even if your family income exceeds the limit — let’s say you’re married, filing jointly and have a $200,000 AGI, with one qualifying child you can still see a $400 check. Without children, you wouldn’t be eligible for a check at all.

3. Competing eligibility changes could bring more money in different ways

While we expect a second stimulus check to largely follow the same guidelines as the first, the requirements are subject to change. That might even benefit your family. One approach redefines who counts as a qualifying dependent and would give your family $500 for each dependent you identify on your taxes, regardless of age. 

The current $1.8 trillion proposal from the White House offers a $1,000 payment per child dependent. We’ve broken down how some families would benefit more from one approach versus the other when it comes to your total payment. (Here’s how young people would qualify for their own $1,200 check.)

4. The stimulus check is supported by both parties, but…

Democrats want it. Republicans want it. And Trump also wants to send another round of checks out to Americans. In fact, every stimulus proposal since the first check began going out in April has included a second direct payment. 

Though a new payment is wrapped up in a bill of one form or another that has to pass both chambers of Congress and get the president’s signature, this is one element on which they all agree. 

However, a standalone bill like the one now being floated in the Senate will not include another check (see the negotiations section above). This proposal expected to pass the House, but the passage of any standalone aid would not necessarily preclude a second stimulus check from happening — it would shift the timeline, though. 

5. The IRS might deliver stimulus money to you faster

The IRS has already gone through the growing pains of figuring out how to mobilize and deliver one round of stimulus money. In theory, the agency could speed up the process of sending the first batch of payments, when and if they’re approved. The tracking tool is already up and running, the system is in place and it’s likely that the majority of people who qualified for a first check will also receive another.

The timeline is constantly shifting, but we mapped out potential dates a check could be sent if approved before — and after — the election.

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Next stimulus checks: What to expect

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6. There are different priority groups for sending payments

Not everyone gets their checks at the same time and some of that comes down to how you’re getting paid. For example, direct deposit — an electronic transfer of funds into your bank account — could happen weeks before people start to receive a paper check or prepaid EIP card in the mail. We identified five priority groups based on the first stimulus checks.

7. The IRS may still owe you a check

If you’re still waiting for your first payment, there are several ways to hunt it down. As many as 9 million people still need to register with the IRS to receive the first check — the deadline is Nov. 21 and we show you how to do it. Some people with dependents received only a partial payment and are still owed money. The deadline to get that in 2020 passed Sept. 30, but we explain how you can claim it with next year’s taxes.

8. The rules and exceptions can get complicated, fast

When and if a second stimulus check does get approved, the details will require some unraveling. While some situations are straightforward, other complications about you and your dependents may make it unclear if you’re eligible and for how much. Fringe cases abound. 

For example:

9. You don’t owe taxes on stimulus money

The IRS doesn’t consider stimulus money to be income, and a payment you get this year won’t reduce your refund in 2021 or increase the amount you owe when you file your 2020 tax return. You also won’t have to repay part of your check if you qualify for a lower amount in 2021. The IRS said if you didn’t receive everything you were owed this year, you can claim it as a credit on your 2020 federal income tax return by filing in 2021. Here’s everything to know about stimulus checks and taxes.

There’s much more to know about other government payments during the pandemic, including a possible interest check from the IRS and where the $300 federal unemployment benefit is now.