Fourth Stimulus Check Payment
Fowlerville @aaronburden
Was there a fourth stimulus payment after Stimulus One, Economic Impact Payment Two, and Stimulus Three?
In March of 2020, President Trump signed into law Stimulus One and, in December 2020, Stimulus Two; in Spring 2021, Stimulus 3 was passed by President Biden. 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; for Stimulus 3, claim this on your 2021 Return. These payments are defined as fully refundable tax credits. The time to e-file a 2020 and 2021 Return has passed; see how to prepare a previous year return to claim your payments if you never received them. e-File your current year return on eFile.com, however there is no Recovery Rebate Credit or Stimulus 4 payment on any return after 2021 returns. In other words, you cannot claim any stimulus payments by e-filing the current year return.
Note: The IRS "Get My Payment" tool is no longer relevant as the IRS stopped issuing stimulus checks on December 31, 2021.
What Is Stimulus Four?
In summer of 2021, President Biden introduced the Build Back Better economic program which included the American Jobs Plan and the American Families Plan. A 4th stimulus payment was rumored to potentially be part of one of the plans - see other tax rumors. The Build Back Better plan failed and was not brought back and there were different spending plans discussed in congress that failed as well. These bills may have included other tax breaks and changes, like the extension or revival of the advance Child Tax Credit of 2021. However, none of these bills ever passed and stimulus payments are no longer being issued by law as of December 31, 2021.
These payments were to be issued based on the tax return information the IRS had on record for you. It is best that you had filed your 2020 and 2021 Tax Returns to get all of your information so the IRS could have issued these payments. The third stimulus payment was an advance payment of the 2021 Recovery Rebate Credit similarly to how the first and second were advance payments of the 2020 Recovery Rebate Credit.
See an overview of all stimulus packages and payments.
How to Claim Stimulus Payments
As part of the 2020 Recovery Rebate Credit, taxpayers and non-filers were instructed to file a Form 1040 (Income Tax Return, ITR) and claim the stimulus checks on Line 30. This was for 2020 Returns and only addressed 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.
Additionally, taxpayers should have filed a 2021 Return not only to claim missing payments for Stimulus 3 only, but to update their information with the IRS 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 was adjusted for the third payment.
Claim the third stimulus on your 2021 Tax Return as part of the 2021 Recovery Rebate Credit. Additionally, claim the remainder of your 2021 Child Tax Credit. If your 2021 tax information changed, this will be reported on the 2021 Return and your credit amounts will be adjusted accordingly.
Most importantly, if you changed your address or bank account, i.e. you recently closed your bank account or you moved to a new home, the IRS needs to have this on record to send payments, refunds, and notices. The only way to update your direct deposit information is by filing a tax return. To update your bank information on a return, you also need to 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 the current year return now or by the Tax Day deadline.
Get the details on the expired stimulus packages, unemployment changes, and the Child Tax Credit.
2021 Stimulus or American Families Plan, American Jobs Plan
What else was part of the proposed bill by President Biden and the democrats? Below, find key points that were part of the proposal. It is important to know that these were drafts and ideas which were not written into law.
- Years of free education: this would make preschool through grade 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 enhanced program was only for 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.
Additional Resources:
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