As a response to the continuing COVID-19 pandemic and economic impact, Congress passed H.R. 1319, the American Rescue Plan of 2021, which President Biden signed into law on March 11. The $1.9 trillion COVID-19 stimulus bill includes direct payments of up to $1,400 for individuals, billions to help schools and colleges re-open, and funding for vaccine distribution.
Part of the relief provides a third round of Economic Impact Payments (EIPs) for individuals. These direct cash payments are intended to provide a boost to the struggling economy by giving money to those who are in most need of additional support.
Who is eligible for the third round of Economic Impact Payments, and how much will they receive?
U.S. citizens and resident aliens who are not eligible to be claimed as a dependent on someone else’s income tax return are eligible for the third payment. Eligible individuals will automatically receive an EIP of up to $1,400 for individuals, or $2,800 for married couples, and up to $1,400 for each qualifying child. Generally, recipients with adjusted gross income for 2019 (2020 if they have filed their 2020 tax returns already) up to $75,000 for individuals, and up to $150,000 for married couples filing joint returns and surviving spouses, they will receive the full amount of the third payment. For filers with income above those amounts, the payment amount is reduced.
What will people need to do in order to receive the rebate?
Payments are automatic for eligible taxpayers who filed a 2019 (or 2020) tax return; those who receive Social Security retirement, survivor, or disability benefits (SSDI), Railroad Retirement benefits, or Supplemental Security Income (SSI); and Veterans Affairs beneficiaries who didn’t file a tax return. Payments are also automatic for anyone who successfully registered for the first payment online at IRS.gov using the agency’s Non-Filers tool, or anyone who submitted a simplified tax return that has been processed by the IRS.
Will the IRS notify recipients after the rebates have been sent?
In previous rounds, people received an IRS notice, or letter, after they received a payment with the amount of their payment. Recipients should keep this for their tax records.
When will the third round of EIPs be sent?
According to the White House press secretary, the IRS and Treasury are working hard to get the payments out as soon as possible. The direct deposits could potentially begin being sent to accounts as soon as this weekend.
The direct deposits will then be followed by checks, and finally prepaid cards.
How are the EIPs going to be identified?
The third round of EIPs made by ACH Direct Deposit will be identified with the following information:
Company Name: “IRS TREAS 310”
Company Entry Description: “ TAX REF ” OR “ TAXEIP3 “
Company Identification (Field 5, Positions 41-50):
ICD + ‘111036170’
‘111736946’
‘111736959’
‘111736043’
‘111736056’
‘111736069’
‘111736072’
‘111736085’
‘111736098’
‘111736108’
‘111736205’
‘111736218’
‘111736221’
‘111736234’
‘111736247’
‘111736250’
‘111736263’
‘111736276’
Question may be directed to the U.S. Treasury’s Bureau of the Fiscal Service Payment Center at (855) 868-0151, option 2, option 0.
What if the member is deceased?
Under H.R. 1319, deceased individuals that died on or after January 1, 2021 are eligible for EIPs (but may be subject to other eligibility criteria). RDFIs may post received EIPs with the assumption that the recipient has been screened for eligibility
Are third round of EIPs taxable?
The EIPs will not be counted as taxable income for recipients, as the rebates are a credit against tax liability and are refundable for taxpayers with no liability to offset.
Are the third round of EIPs subject to garnishments?
H.R. 1319 did not provide the clear exemption from garnishments that the previous two rounds did, but there may be state laws that prohibit garnishment of these funds.
Are the third round of EIPs subject to reclamation?
The payments have the status of a tax rebate and should not be subject to reclamation.
Where can I view the American Rescue Plan for myself?
You can view the American Rescue Plan of 2021 online here.
Information from: Northwest Credit Union Association
www.nwcua.org