Some people have already received the third economic impact payment (EIP), which is $1,400 per person, as authorized under the just enacted American Rescue Plan.
Of course, we're already hearing some grumbling. That's to be expected any time the Internal Revenue Service, which once again is tasked with distributing the relief money, is involved.
But at least initially the IRS seems to have the system down after having done this two previous times.
So now we wait. Hopefully we don't have to wait too long.
And while we wait, today's Saturday Shout Out goes to the IRS and its online announcements of how it's doing this EIP3, as this latest payment has been dubbed by the IRS, job and what to expect. That info can be found in the agency's:
- Press release IR-2021-54 on IRS begins delivering third round of Economic Impact Payments to Americans;
- Fact Sheet FS-2021-04 on More details about the third round of Economic Impact Payments; and
- Get My Payment online search tool page.
Hurry up and wait: The main thing the IRS is trying to get across to anxious taxpayers eager for their $1,400 (or more if they're married and have families) is that they don't have to do anything but wait.
No action is needed by most of us, says the IRS. If we're eligible, the $1,400 per person payments will be automatic, just like they were for most folks who got the first and second round of 2020's EIPs.
The vast majority of this latest round of EIPs will be by direct deposit, with the first batch, as we've already discovered, arriving this weekend. Additional payments will be sent in the coming weeks by direct deposit and through the mail as a check or debit card.
Filed vs. processed tax returns: Since this weekend feature is designed to let you browse the Shout Out items at your own pace, I'll leave you to it.
But I did want to take a look at one area. Just how will the IRS determine how much EIP3 each of us will (or won't) get?
The amount of EIP3 you get will be based on "the taxpayer's latest processed tax return from either 2020 or 2019. … If the IRS has received and processed a taxpayer's 2020 return, the agency will instead make the calculation based on that return."
Note the phrase "latest process tax return," which I highlighted in the IRS quote above. This means if you just submitted your 2020 Form 1040 and it was accepted, it likely won't be the basis for your EIP3 amount because accepted and processed are two different things. Instead, the agency will use the last completed (i.e., processed) info it has on you from earlier processed return filings.
Or maybe not. Read on.
That statement above about latest processed tax returns was in the IRS' news release. In its separate Fact Sheet, the IRS again says that it will "use available information to determine eligibility and issue the third payment."
And in the Fact Sheet, the IRS says an EIP3 will go to eligible people who —
- Filed a 2020 tax return.
- Filed a 2019 tax return if the 2020 return has not been submitted or processed yet.
- Did not file a 2020 or 2019 tax return but registered for the first Economic Impact Payment using the special Non-Filers portal last year.
- Are federal benefit recipients as of December 31, 2020, who do not usually file a tax return and received Social Security and Railroad Retirement Board benefits, Supplemental Security Income (SSI) and Veteran benefit recipients in 2020. The IRS is working with these agencies to get updated information for 2021 to assist with stimulus payments at a date to be determined.
So maybe filing a 2020 tax return alone is sufficient. But I don't want to get your hopes up, so maybe not.
IRS top off: There's also been discussion among tax folks online, aka #TaxTwitter, that if the IRS does issue an EIP3 amount and then find, based on subsequent (or processed) 2020 return information, that it should have been more, the agency will add the coronavirus relief amount to the taxpayer's filing.
"IRS will automatically top it up."— Adam Markowitz (@adammarkowitzEA) March 12, 2021
This I've gotta see. You wanna talk about problematic? I file a tax return 3/15. IRS gives me my stimulus. Oopsy. Forgot to mention this $5M K-1 that I have. 1040X by 4/15. IRS has no clawback. https://t.co/2DplfuPQ6e
I must admit that I share Adam Markowitz's skepticism about this being done, or at least done without a slew of problems.
But we shall see. And my earlier mention of patience notwithstanding, I hope we all shall see soon.
You also might find these items of interest:
- New COVID relief payment means return of pandemic scams
- Tax-free unemployment change could require amended tax return filings
- The child care tax credit is a good claim on 2020 taxes, even better for 2021 returns
|Coronavirus Caveat & More Information
In 2021, we all still are dealing with extraordinary circumstances,
both in our daily lives and when it comes to our taxes.
The COVID-19 pandemic and efforts to reduce its transmission
and protect ourselves and our families means that,
for the most part, we're focusing on just getting through these trying days.
But life as we knew it before the coronavirus will return,
along with our mundane tax matters.
Here's hoping that happens soon!
In the meantime, you can find more on the virus and its effects on our taxes
by clicking Coronavirus (COVID-19) and Taxes.