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Fourth Stimulus Check Payment

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Fowlerville @aaronburden

Will there be a fourth stimulus payment after stimulus one, two and stimulus three?

In March of 2020, President Trump signed into law stimulus one and, in December 2020, stimulus two. If you did not get stimulus 1 and/or 2, you can claim these missed payments on your 2020 tax return as the Recovery Rebate Credit. These payments are defined as fully refundable tax credits.

In March 2021, President Biden signed into law the American Rescue Plan Act (ARPA) and Stimulus 3. You can check the status of the third stimulus payment online:

Get Your Stimulus Payment Status

Track Stimulus Payment by EIP Card

Note: the current IRS "Get My Payment" tool will only show the most recently issued stimulus payment - in this case, stimulus three.

Now, there is talk about the Build Back Better economic program which includes the American Jobs Plan and the American Families Plan. A 4th stimulus payment could possibly be part of any of the two plans. Additionally, this may include other tax breaks and changes, like the potential extension of the advance Child Tax Credit of 2021. Details of these proposals have not been made public; we will post updates here as they become available. Biden's new tax plan will bring many changes that will be detailed on this page as they are signed into law.

Important: these payments are to be issued on the tax return information the IRS has on record for you. It is best that you file a 2020 tax return as soon as possible to get all of your information so the IRS can issue these payments. The third and potential fourth payments are not included on the 2020 return, but filing one gives the IRS the necessary information to issue these payments. Sign up for a free eFile.com account and get your 2020 return to the IRS so they can issue you any tax payments with the correct amount you are owed. The third and potential fourth stimulus payments are to be advance payments of the 2021 Recovery Rebate Credit similarly to how the first and second are advance payments of the 2020 Recovery Rebate Credit.

See an overview of all stimulus packages and payments.

Do I have to File a 2020 Return for Stimulus?

As part of the 2020 Recovery Rebate Credit, taxpayers were instructed to file a Form 1040 (Income Tax Return, ITR) and claim the stimulus checks on Line 30. This is for 2020 returns and only addresses the first and second stimulus payments. Those who do not normally file were told to do so as well if they did not receive this payment.

Currently, taxpayers will want to file this not only to claim missing payments, but to update their information with the IRS. Why? Because the stimulus payments are based on a few pieces of information. You want the IRS to know your income as there is a certain threshold your Adjusted Gross Income (AGI) has to fall within. To see this amount, view the linked stimulus pages as the amount has been adjusted for the third payment.

In addition to communicating your income, you also want to update your dependents with the IRS. If you have IRS qualifying dependents, they may make you eligible for additional stimulus payments and thus increase your credit. Also, as part of the American Rescue Plan Act, the Child Tax Credit will be receiving an enhancement in 2021. You may be eligible for advance payments of this starting in July 2021; while an online portal will be created for this, it is a good idea to get your dependent information to the IRS via a 2020 tax return.

Most importantly, if you changed your address or bank account, the IRS will have no way to issue your stimulus checks. If your bank account was recently closed or you moved to a new home, the IRS needs to have this on record to send payments. The only way to update your direct deposit information is by filing a 2020 return AND have a tax balance (refund or taxes owed). If you do not normally file, but want to in order to update your information, contact us and we will help you with this.

Update your bank account, dependents, income, and other information with the IRS by filing a 2020 return now or by the new 2020 deadline: May 17, 2021.

Review the most recent news regarding stimulus packages, unemployment changes, and the Child Tax Credit. If or when the next stimulus package is furthered into law, this page will have those updates.

2021 Stimulus or American Families Plan, American Jobs Plan

What else is part of the upcoming bill by President Biden? Below, find key points that are part of the current proposal. It is important to know that these are drafts and ideas which have not been written into law. All of the below information is subject to change:

  • Years of free education: the plan is to make pre-K through 12 education more accessible, but also include means to give students two years or free education at a qualifying community college. Additionally, increase aid to students attending a university via Pell Grants. With free education, there may be some tax implications to come. See information on students and taxes.
  • Extend the Child Tax Credit increases from ARPA through 2025; the program currently goes through 2021, but the plan would continue it through 2025, potentially keeping the CTC fully refundable.
  • Make the increases to the Child and Dependent Care Credit (CDCC) and the Earned Income Credit (EIC) for childless workers permanent.
  • Cuts to health insurance costs through the marketplace - this is done by increasing the amount of the Premium Tax Credit as well as widening the requirements to qualify for it.
  • Create a better program for providing paid family and medical leave, largely inspired by the hardships families may have faced due to COVID-19. This aims to be a national program that will ensure workers are given partial wage replacement for life changing events, like newborn children or caring for an ill family member.
  • Reform the unemployment insurance system and offer better, more comprehensive unemployment benefits for American taxpayers who lose their jobs.

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