Do you know how your stimulus check money really works out? It isn't easy.
Angela Lang/CNETIf you care about the size of your next stimulus check, or wonder how the IRS calculated the first one, you're in the right place. Knowing how the IRS determines how much money you get is important for understanding the cloudy brew of working out how much each household gets in a payment.
For the majority of people, the first round of checks appeared out of thin air, without them having to apply or do a thing to receive them. Convenient, but that also means there was little clarity about why some people got the total they did, and few ways to appeal if you feel there may have been a calculation error.
As negotiations for a second stimulus check reach high drama, we wanted to demystify the stimulus payment process, from figuring out which priority group you might be in to explaining the nuances of qualifications and how they could change.
Here, we'll help explain how the IRS works out totals that can be far greater or far less than $1,200 per individual. For example, did you know it's possible for a married couple who maxes out the income limit to still receive a $400 check? We'll explain it all. You can also try CNET's stimulus check calculator for an estimate of what your payment could be, assuming one is eventually authorized in a new stimulus bill. This story was recently updated.
Watch this: Next stimulus checks: What to expect
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Stimulus check totals: More or less than you expect?
Before we unwrap the details of what the IRS is doing when it determines your share of the stimulus check money, we wanted to give you some real-world examples of how the checks could pan out for people who claim dependents, in different scenarios.
Remember that an individual can qualify for a stimulus check of up to $1,200, a married couple who files taxes jointly can get up to $2,400, and the first check threw in an extra $500 per qualified child dependent. Note that a head of household is someone who files taxes individually and has at least one dependent. People who are considered single filers claim no dependents on their taxes, only themselves, which is why this group isn't included in the chart below.
These figures are based on the rules set out for the first check, worked out using CNET's stimulus check calculator -- they don't include variables for a second check and are estimates only. There are a lot of secondary qualifications that could determine your final sum. If the amount below looks higher than what you received though, you may need to investigate a catch-up payment from the IRS for dependents who were skipped in the first check.
Stimulus check calculations with dependents (First check)
| Head of household | Married couple, filing jointly | |
| Estimated total with: | ||
| AGI of $40,000 and no dependents | $1,200 | $2,400 |
| AGI of $115,000 and no dependents | $1,075 | $2,400 |
| AGI of $200,000 and no dependents | Not eligible | Not eligible |
| AGI of $40,000 and 1 dependent | $1,700 | $2,900 |
| AGI of $115,000 and 1 dependent | $1,575 | $2,900 |
| AGI of $200,000 and 1 dependent | Not eligible | $400 |
| AGI of $40,000 and 2 dependents | $2,200 | $3,400 |
| AGI of $115,000 and 2 dependents | $2,075 | $3,400 |
| AGI of $200,000 and 2 dependents | Not eligible | $900 |
How does the IRS decide your stimulus check allowance?
For most people, the answer is "taxes." Specifically, the IRS starts with the adjusted gross income you put on your 2019 federal tax returns if you filed them or otherwise your 2018 returns. (If you don't typically file taxes, here's what you need to know.)
If you're an individual US citizen, head of a household or part of a married couple filing jointly, the most money you could make in a year (your AGI) and still get a check looked something like this, according to the CARES Act:
- $99,000 for eligible individuals (up to $1,200)
- $136,500 for head of household filers (up to $1,200)
- $198,000 for married couples filing joint returns (up to $2,400)
But there are two important facts you also need to know: First, at a certain "income cap," the IRS reduces the total you can get by $1 for each $20 of income you have over the cap. So if you're a single person filing alone and your AGI is less than $75,000, you'd likely get the full $1,200. As your AGI goes up, your check would get smaller.
Second, these numbers don't factor in children. The IRS would include a $500 payment for each qualifying child 16 years or younger that you claimed on your tax return, which means you could still get more -- or less -- than the per-person or per-couple limit depending on your income.
When the IRS put it all together for the first payment, the agency started with the largest amount you'd be eligible to receive ($1,200 per single taxpayer or $2,400 for joint), added $500 for each qualifying child and then reduced the total possible sum according to your AGI.
Washington continues to work on the details or a new stimulus package.
Angela Lang/CNETIt's a little like starting a test with a perfect 100 points and subtracting every point you "miss," rather than starting with zero points and adding them all up at the end of the test.
But in this case, the dependents you name can start you at a higher value, say 110 points in our classroom example. So by the time you subtract "points," you may still have more than people who don't have dependents, even if your AGI is high.
That's why it's possible you could be out of range for a payment based on your AGI and still receive a check for eligible dependents. Still confused? We don't blame you. Maybe these other scenarios we looked at will help ballpark how much you could get.
What does this mean for your second payment?
If and when Congress does approve a new economic stimulus package with a second round of checks, the size of your payment could largely depend on any new rules that affect dependents, even if the $1,200 and $2,400 caps stay the same.
Right now there are two proposals to cast a wider net for dependents. One would allot more money for children (e.g., $1,000 instead of $500), and the other would include more dependents (e.g. $500 for college students and older parents who live with you).
Both would potentially increase your family's overall pool. Remember, the bigger the sum a family starts with, the bigger the check they are likely to receive after the IRS makes its deductions based on your AGI.
Again, here's a comparison of what the difference could look like for some families -- with varying AGIs and types of dependents -- if the rules change one of two ways. In that story we also explain different ways you could see more, or even less, money on a second check.
For now we keep our eyes on Washington. For more, see our guides to the first round of checks, SSDI recipients and checks and how older Americans can also qualify.
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