The IRS has been sending out stimulus checks every week for the past two months. And that includes a plus-up check going out to many who have received their first stimulus payment. Even you could be in for a pleasant surprise if you have recently filed your 2020 tax returns.
Nine rounds of payments have already gone out sending more than 168 million payments totaling $388B. Just this week $1.8 billion was sent out to close to 1 million people. This figure included those who have received a previous third stimulus check.
In fact, the IRS has made around 6 million plus-up payments in the past two months.
Getting The Right Details For The Stimulus Check
One major reason many people have not received their stimulus checks is that they have not given the necessary banking and mailing details to the IRS.
Close to half of the current round of 1 million checks are going out to people whose mailing details were previously not in the IRS records. Their payments were held up because the IRS could not reach out to them. They also did not have the bank details necessary to make a direct transfer.
File Your 2020 Tax Returns To Get Your Full Stimulus Check
The easiest way to update these records is to file the latest tax returns with the IRS. This applies even to those who normally do not need to file their tax returns.
May 17 is the last date for filing your 2020 tax returns. Send in your returns by that date and the IRS will have all the information it needs to send you your stimulus check. And they will have all the details they need to send you the full amount.
Remember, you can file returns even if your income is below taxable limits. You will be entitled to the full stimulus amount. The IRS will have both your bank details and your mailing address to send you the payment. And you will have given the IRS details of all the dependents in your household, including children born in 2020.
Claiming A Plus-Up Payment
The IRS has sent around 460,000 payments totaling payments of $800M as plus-up payments in this round. Also called catch-up or bonus payments, they are payments based on fresh calculations as more people are filing their 2020 tax returns in recent weeks.
The IRS had sent out an initial stimulus check based on their 2019 returns, or old records. The fresh tax returns have given more information, including details of new dependents or the birth in the family. Each member has the potential to add $1,400 to the stimulus amount.
If your stimulus check was based on the 2019 returns, you could be in for a second stimulus check if you have recently filed your 2020 tax returns.
If your payments are lower in 2020, you could be in for a plus-up payment too. Lower earnings in 2020 are common to most Americans who were either laid off or had a lesser number of working days.
Individuals qualified for a full $1,400 only if their earnings are $75,000 or lesser. The amount phases out beyond that and individuals earning $80,000 or more do not get any stimulus check. The same applies to couples who earn $150,000, the upper limit being $160,000.
For Heads of household, the corresponding figures are $112,500 and $120,000.
Boosting Your Stimulus Check
There aren’t any more stimulus checks coming your way, at least not in 2021. There is the child tax credit payment set to start in July. But there are a few steps you can take to make the most of your dollar.
Expand Your Savings
These are tough times and require tough measures to get through difficult times. With earnings getting severely limited across most sectors, you need to make every penny count and concentrate a little more on saving some.
Cut down on services and subscriptions when you can do without them. Resist the urge to order meals online. Home-cooked food costs way less and is healthier to boot.
It is time to browse and avail of every discount and free coupon you can lay your hands on.
Tweak Your Finances
You could save a lot by refinancing your current mortgages. The rates in the US have plunged below 3%. So if you have been paying at a higher rate, you need to wake up immediately.
Mortgage service provider, Black Knight has calculated that 13M Americans could save an average of $283 per month just by refinancing their home loans.
Rejig Your Insurance Policies
The biggest discount in the insurance sector is on car insurance. People are driving less due to the pandemic and car insurance companies are offering generous discounts. Show around for better deals. The same goes for home insurance. You could end up saving hundreds.
It Is Time You Started Investing Again
Things are not going back to normal very soon. So it doesn’t make sense to wait for better times to begin investing again. Restart by making small investments. Do your research and do not lay all your eggs in one basket. Go for a diversified portfolio.
Many stocks are poised to take off as the country returns to a semblance of normalcy. Apps now let you buy even one share at a time.
You might not need every penny of your stimulus check. The priority indeed is to cover the basics. But you might also end up saving a part of your stimulus check. Once you have taken care of your baseline needs and stashed some aside for a rainy day, try to invest the remaining money with an eye on the future.