Lawmakers in Washington, D.C. are negotiating what your second stimulus payment is going to look like.
The Senate unveiled its plan on Monday, while the House of Representatives passed its plan two months ago.
Both proposals are similar to the first stimulus payment with one big difference: how they handle payments for dependents.
The original stimulus plan from the CARES Act coronavirus relief bill paid $500 per child under age 17. That left out many people, including older children, college students and older family members who are someone else’s dependents. They would be included as dependents in both of the new stimulus proposals.
We don’t yet know if either of these plans — or a compromise version — will ultimately be passed by Congress.
Except for the dependent payment, both plans would act very much like the first stimulus payment from the CARES Act, giving $1,200 to singles earning up to $75,000 and $2,400 to couples who file a joint tax return and earn up to $150,000. Those who file as head of household — a common filing status for single parents — get $1,200 if they have income up to $112,500.
Singles who earn up to $99,000 and couples who earn up to $198,000 would get a partial benefit.
While the CARES Act allowed taxpayers to get an additional $500 benefit for each dependent child under 17, it left out older children and older family members who are claimed as dependents on a person’s tax return.
The Senate plan would pay $500 for every dependent, regardless of age.
The House plan offers larger benefits for dependents. It would give $1,200 for every dependent with a maximum benefit of $6,000 per family, without any age cutoff.
The benefits for dependents will also gradually go down as your income level rises.
This calculator shows what your benefit could be under the Senate and House of Representative proposals, but note that lawmakers will negotiate before we know the final plan.
Now, it’s up to parties from both houses to negotiate a deal that can be passed into law.
With the last stimulus payment, it took a while for the IRS to get some kinks out of the system. This time it should be easier because while not everyone has been paid from the first round, the agency has learned some lessons that should help it get payments out more efficiently this time, officials say.
For most Americans, the IRS will use data from your 2019 tax return to determine the size of your benefit. If it doesn’t have your 2019 data, it will use your 2018 return.
The agency also has already collected information on those who receive Social Security, Supplemental Security Income (SSI) and veterans benefits — data the IRS did not have when the first stimulus plan was passed.
The IRS created a tool to help low-income people who don’t file tax returns — the “Non-Filers: Enter Payment Info Here” tool — so people could file a simple tax return and get into the system for a stimulus payment. It also allowed people who don’t normally file tax returns to claim dependents to get the extra per child benefit. That tool was shut down in May, but it may eventually be reopened so people can make sure the IRS has their information.
NJ Advance Media Staff Writers Jonathan D. Salant and Chris Faytok contributed to this report.
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Karin Price Mueller may be reached at KPriceMueller@NJAdvanceMedia.com.
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