The third round of stimulus checks is on its way! If you’re expecting a stimulus check, it’s time to talk game plans. Whether you use it to pay down some debt or add toward your next big purchase, a clear idea will help you make the most of this upcoming relief bill.
What’s in the bill for me?
Parents! Look forward to an increased 2021 child tax credit of $3,000 per kiddo aged 17 and under. Plus, $600 on top of that for kiddos under 6. Half of what you qualify for will advance in the form of monthly payments from July to December. The rest will come when you file next year’s tax return.
Does that include me?
If you earn up to $75K (or $150K for couples filing jointly), yes. If you make more than $80K as a single filer (or $160K for joint filers), no. Somewhere in between, you may get a lower amount. This calculator can help you figure out what you’ll get.
How does the gov know how much I make?
Your most recent tax returns have the clues! If you haven’t submitted your 2020 return yet, they’ll use the income on your 2019 return. If you had a pay cut, added a dependent, or changed anything else last year that could get you a bigger stimulus check, file this year’s taxes ASAP. If the IRS starts giving out stimulus money before you file, they can send you the difference later.
Will I have to pay this money back?
Nope! And you won’t owe taxes on it.
What should I do with any money I get?
If you’ve got immediate needs to fulfill, start there. Groceries, bills, medications: make sure those fundamental needs are taken care of. After that, give your emergency fund some love. Because if 2020 taught us anything, it’s that we have no idea what the future holds.
Paying down credit card debt is another great move to make. A smaller balance = less to pay interest on.
And if I’m good in those areas?
Stimulus checks not only do good for you, but they also do great things for your local economy! Save it for another special goal of yours! Or, treat yourself to a local shopping trip around your town. Supporting local restaurants, artisans or donating it to your local nonprofits is cool any day of the year. Don’t have anything you need right away? Buy gift cards to your local shops. Gift them to your friends or save them for when the perfect item finds you unexpectedly!
If you’ve got goals, let’s meet! We’re here to support you and answer any questions.