What you need to know about the second round of stimulus payments.
On December 27, 2020, the Coronavirus Response and Relief Supplemental Appropriations Act of 2021 was signed into law. As authorized by the act, the United States government is sending economic impact payments (EIP) to individuals to help lessen the impact of the COVID-19 crisis.
Since many stimulus payments were delivered via direct deposit on December 29, 2020, you may already see your EIP posted to your account. You can use online or mobile banking to check your account deposits. You may also find out if a payment has been posted by calling ART at (319) 393-2266 or contacting our member services team during regular business hours. According to the IRS, the mailing of paper checks began on December 30, 2020.
If you’re not sure if the stimulus payment is coming to your Linn Area account, please visit the IRS’ Get My Payment portal to check on the status of your economic impact payment.
Who receives the stimulus payments?
The IRS indicates that individuals with adjusted gross income (AGI) up to $75,000 for single filers, $112,500 for head of household filers and $150,000 for married filing jointly are eligible for the full $600 for individuals and $1,200 for married filing jointly. If your income is above these amounts, your EIP will be reduced by 5% of the amount by which your AGI exceeds the applicable threshold. If you’re a parent, you’ll receive up to an additional $600 for each qualifying child.
You also might be eligible for the economic impact payment if you’re a:
- Recipient of Social Security, Railroad Retirement, disability or veterans’ benefits
- Taxpayer who doesn’t normally have to file a tax return
Payments are automatic for eligible taxpayers. Payments are also automatic for anyone who successfully registered for the first payment using the now-defunct IRS’ Non-Filers tool by November 21, 2020, or who submitted a simplified tax return that has been processed by the IRS. The IRS emphasizes that there is no action required by eligible individuals to receive this second payment.
Who is not eligible for the payment?
According to the IRS, you likely won’t qualify for a stimulus payment if you:
- Were claimed as a dependent on another taxpayer’s 2019 tax return (for example, a child or student who may be claimed on a parent’s tax return or a dependent parent who may be claimed on an adult child’s tax return)
- Don’t have a Social Security number that is valid for employment issued before the due date of your 2019 tax return (including any extensions)
- Are a non-resident alien
- Are an estate or trust
When will the payment arrive?
Most payments will be distributed automatically over the course of three weeks beginning on December 29, 2020. The Treasury has indicated that this round of payments will conclude at the end of January. The IRS plans to mail an informational letter about your payment to your last known address.
How the IRS determines where to send your payment
The IRS will use the data already in their system to send the new payments. Taxpayers with direct deposit information on file will receive the payment that way.
If you don’t receive a direct deposit by early January, you should watch your mail for either a paper check or a debit card. The type of payment for this mailed stimulus payment may be different than the one you received by mail the first time. Some people who received a paper check last time might receive a debit card this time, and some people who received a debit card last time may receive a paper check.
The IRS states that if you’re a retiree who receives either Social Security retirement or Railroad Retirement benefits, you’ll automatically receive your payment the same way you normally receive your benefits.
How to check the status of your payment
Access the IRS’ Get My Payment portal to check on the status of your Economic Impact payment. The tool allows you to review the status of all stimulus payments made so far, along with the method of delivery.
If you have questions, the IRS has answers!
What happens if you’ve closed the Linn Area account you used for your tax refund deposit
If you’ve totally closed all your accounts with Linn Area Credit Union, then we must return the deposit to the U.S. Treasury Department. (Sorry, we don’t make the rules.)
If the account that the stimulus deposit is coming into has been closed, but you have other open accounts with us, we intend to post the deposit to the open account and NOT return it to the U.S. Treasury. (So, yes, in this case, you’ll get your stimulus money on the first go!)
Please understand that we don’t have the inside scoop on the IRS, so we don’t know your specific situation. If you think your payment may have been deposited directly into your account, please access the IRS’ Get My Payment portal to check on the status of your payment.
What’s a good way to use the money?
Great question! If you’re struggling and need the money for necessities, by all means use it to get what you need for your household. (That’s what it’s meant for!) If you’re in a better position financially, here are a few other good ideas:
- Pay down any high-interest debt
- Pop it into your Linn Area savings account to have it available for when you need it. (Plus, it’ll earn interest!)
- Save for retirement using an IRA or other investment strategy
- Use the 50-30-20 strategy
- Use 50% for your needs, such as household utilities, food, car payment, etc.
- Spend 30% on your wants, such as takeout dinners or fun gadgets
- Apply the remaining 20% toward your financial future, such as paying down debt or putting it toward your savings or investments
- Support local businesses, local nonprofits, or people you know who may need a little help. (Here are just a few ideas to get you thinkin’!)
- Order takeout from your favorite local restaurant and leave an oversized tip for the waitstaff
- Donate to a nonprofit organization that is close to your heart or one that provides food, clothing, and/or housing assistance for those affected by the derecho.
- Gift it to a family member or friend who may be going through a difficult time right now. (With the combined economic impact of the pandemic and the derecho, odds are you know someone who could use a boost.)
Beware of COVID-19 scams
Whenever something new comes up, scammers will take advantage of the situation to try to trick you into giving them personal financial information. Unfortunately, the COVID-19 pandemic is no different. Learn more about how to avoid Coronavirus scams.
And here’s a tip directly from the the U.S. Department of the Treasury specifically about the stimulus payments: If you receive calls, emails, or other communications claiming to be from the Treasury Department and offering COVID-19-related grants or stimulus payments in exchange for personal financial information, or an advance fee or charge of any kind, including the purchase of gift cards, please do not respond. These are scams.
Financial assistance for small business owners
If you’re a small business owner, Linn Area Credit Union is committed to helping you navigate the COVID-19 relief options. Learn more about the resources available to small business owners.
We are here for you!
We recognize that this is a crazy time for all of us! If you have questions that we didn’t cover, please contact our member services team during regular business hours, and we’ll do our best to help you.