New stimulus check may be on the horizon: 12 things you need to know now

A bipartisan group of senators is expected to release a new economic relief bill early this week, but the fate of a second stimulus check for eligible Americans remains up in the air. 

The House and Senate will consider the $908 billion package aimed at renewing critical programs that are set to expire before the end of the year. However, this bill is not expected to include another stimulus payment at all. It seems more likely that Congress will approve a second stimulus check in early 2021 rather than in the final weeks of 2020. 

“This is not a stimulus bill,” said Sen. Bill Cassidy, a Republican member of the bipartisan group crafting the new bill, on Fox News Sunday. “It is a relief bill. And it is something for the next three or four months to help those in greatest need. There may be a stimulus check, but that would be part of a different piece of legislation.”

However, several members of Congress are still urging their fellow legislators to send a second check this year, either by adding funding for the payments on to the $908 billion package, or by passing a separate piece of legislation. 

“The millions of people who are most desperately impacted need a check,” Rep. Alexandria Ocasio-Cortez, a Democrat from New York, said Nov. 4.

If no second payment is likely to come this year, then when could you expect your next stimulus check to arrive, and would you get your payment before or after your neighbors? How exactly will the IRS decide how much of that $1,200 you get, and how could the stimulus check qualifications change to bring you even more money — or perhaps less cash — the next time around? Do you know the ways you could be disqualified, or how to claim your first stimulus check now that the IRS deadline has passed? 

We break down the important information below so you know what to expect before another payment arrives. (We update this story often.)

A second stimulus check could still happen soon

Members of a bipartisan congressional group are expected to introduce the language of a $908 billion proposal this week that may come up for a vote before the end of the year. 

The framework is not expected to include a second stimulus check, so it can stand a better chance at passing in the Republican-controlled Senate before the year’s end. But opposition from some Democratic lawmakers and at least one vocal Republican senator is stirring up discussion. 

President-elect Joe Biden is in favor of another direct payment, at least at some point. “It would be better if they have the $1,200 and I understand that may be still in play,” he said, while also calling the $908 billion deal “just a start.”

That is how the bipartisan group also sees it. “Those who want the direct stimulus checks, that will be something a President-elect Biden will grapple with,” Sen. Mark Warner, a Democratic member of bipartisan group, said on CNN’s State of the Union on Sunday.

Your check could arrive earlier or later, according to payment group

Eligible Americans got the first stimulus money at different times, based on five de facto priority groups. For example, people who have set up direct deposit with the IRS — an electronic transfer of funds into their bank account — are expected to get their payment weeks before those who receive a paper check or prepaid EIP card in the mail. Here’s a more detailed definition of the payment groups.

Your next payment could be larger or smaller, here’s why

If the eligibility requirements change with a second check, you and your family could find yourself with more money in your payment or less. For example, anew rule could potentially get you a bigger sum. But there may have also been changes to your life circumstances — such as a birth or death in the family, starting a new job or becoming unemployed — that might also make your second stimulus check smaller. Here’s how you can estimate how much you’d probably get. And here’s how the IRS determines how much money you get.

The IRS could send your check faster once it is approved

With the first check, the IRS was tasked to create an online registration and payment tracking tool, as well as a payment schedule for more than 160 million people. It took 19 days before the first wave of payments was delivered. 

The hope is that the process could go smoother and therefore faster with a second check. The tracking tool is already up and running, the system is in place and it’s probable that the majority of people who qualified for a first check would also receive another. 

The timeline is constantly changing, but we’ve mapped out potential dates a check could be sent if approved before — or after — Biden’s Jan. 20 inauguration.

There are things you can do to prepare now to get your second check quicker

If a second stimulus check is approved, it’s expected the IRS will move quickly to send them out. There are steps you can take now to get your payment faster. We’ve identified ways to help make sure you’re in one of the first waves to get your stimulus money, not the last.

Some people won’t be eligible for another stimulus payment

With the first round of checks, Congress set income limits based on your adjusted gross income that set a line separating who did and didn’t qualify for a stimulus check. But that’s just the beginning. Your status as a dependent or adult, and your citizenship status are among the factors that also helped decide if you got all or some of the first check — and those things will likely also affect the second. Read more about stimulus payment qualifications here.

If your first check never arrived, you can still claim it

Guess what? The IRS might still owe you money from the first stimulus check payout. It may be that some money was left out for child dependents, or that an interpretation of a rule changed (this really happened). Or it could be that you fell through the cracks with your personal situation, that you didn’t think you qualified but you actually do and just need to take an extra step, or that some other error kept you from getting the total amount you were entitled to. Since the Nov. 21 deadline to file your claim has passed, you’ll now need to wait until tax season in 2021 to register for a payment from the IRS. Stay tuned for more information as we get closer.

There’s a formula that will determine how much stimulus money you’ll receive

Predicting what your payment could end up being isn’t straightforward. The IRS used a formula to determine how much stimulus money you got for the first check. Something similar for a second payment would determine whether you receive the full amount, a partial payment or far more than $1,200 if you have kids.

It also explains how you might still be able to get some stimulus money even if your family’s yearly income exceeds the limit set out by the CARES Act in March. The calculation starts with your household’s total adjusted gross income, adds on the money allotted to qualifying dependents and then deducts from the total based on your income bracket (as defined by the CARES Act). 

If you don’t typically file taxes, you could get a check anyway

While taxes and stimulus checks are tied together, you don’t need to have filed a tax return to qualify for a check. If you’re over age 65, for example, and receive Supplemental Security Income or Social Security Disability Insurance, you could still qualify for a stimulus check under the CARES Act. You might need to take an extra step to request your payment (you had until Nov. 21 for the first batch) to get your check.

The stimulus payment you received won’t be taxed in 2021

The IRS doesn’t consider stimulus money to be income. That means 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 stimulus 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.

All the rules and exceptions are extremely important

If a second stimulus check is approved, there will be lots of small details, rules and exceptions that may be confusing. While some situations will be easy to understand, others concerning you and your dependents might make it unclear if you’re eligible and how much money you might receive because there are many fringe cases.

For example:

Certain issues could delay your check, such as if you recently moved.

Yes, your money could be seized — here’s who can take it

In most cases, your check is yours to spend or save how you want and it isn’t taxable. But there are a few situations where the federal government or a debt collector can take all or part of your check to cover a debt, such as if you owe child support.

For more information about stimulus payments, you can check in on what’s happening with stimulus negotiations right now,  find out what Biden plans for a stimulus bill and see which federal benefits expire at the end of the year.