5. What is a Stimulus Check?

As part of offering financial help and overcoming the economic meltdown, the US government started the stimulus check program. It is a way the government endeavors to support the Americans by facilitating cash. The government will offer relief to assist US residents facing financial constraints because of economic shifts.

As part of the Stimulus check initiative, the government would also provide a helping hand to cope with issues related to inflation. It is a factor causing an increase in the prices of certain products and services. When the government facilitates financial support, it will benefit the people to manage these issues.  

In a nutshell, the stimulus check refers to a check provided to US taxpayers. It is a method through which the US government tries to drive revenue.

The authorities can facilitate you with the checks in two different ways. They can send it across to your address as a mail. Second, they can provide it as a tax credit, which can be beneficial while filing your tax.

Over the years, there have been different scenarios for which the government offered stimulus checks. Initially, the government provided stimulus checks after the Great Recession of 2008. After that, during the pandemic, the government facilitated financial aid to its taxpayers. There were three rounds between 2020 and 2021.

In 2020, the government furnished it under the Cares Act. When it comes to 2021, the authorities provided stimulus payments as part of the American Rescue Plan 2021.

Based on the conditions, the authorities might offer new stimulus plans in the future. Now, let's look into the eligibility, how much money you can receive, and other necessary details.

Eligibility for Stimulus Check Payment

Depending upon the type of program offered by the US government, the eligibility criteria for stimulus checks can vary. However, most importantly, you should have an American Social Security number for obtaining a stimulus check. Mainly, the US government provides stimulus checks to three categories of individuals, and they are:

1. Single US resident (here, you can be unmarried or divorced)

2. Family Head who files income tax

3. Couples filing joint taxes without children

And for each of these categories, there are different income levels to gain the stimulus check from the government. Generally, the gross income has to be less than $99,000 per annum for a single US resident. For a family head, it has to be less than $146,500 per annum, and for couples filing their taxes together, their income has to be lower than $198,000 per annum. However, these financial requirements can vary based on the stimulus check payment plan created by the government.

For instance, as per the COVID-19 stimulus check plan, single filers' income has to be approximately $75,000 per annum. For heads of households, it is $112,500 per annum, and for married joint filers, it is $150,000 per annum.

However, if the amount is more than the gross income stated by the government, the money you will receive will get reduced by $5 for each $100. For instance, if your income is $76,000, you would lose $50 from the stimulus check you receive from the government.

How Much Money Will You Receive Via Stimulus Check?

As of now, the base amount you can receive as a stimulus check is $1200. However, it can vary depending on the taxes you have to pay. Recently, in May 2022, the Federal Reserve came up with a stimulus check program for California, Delaware, Indiana, and Chicago residents.

For those from California, Delaware, and Indiana, the government offers a certain amount as stimulus checks to help them manage inflation. Each of these places has different criteria and pay ranges as well.

As per this new regulation, Chicago residents will get a prepaid card to help them pay for gasoline and transit. Other than that, from time to time, the government comes up with different stimulus check plans to aid people financially.

 Now, let's delve into how much money you can gain while opting for a stimulus plan.

● If you are a single taxpayer

When you are single, you will receive a stimulus check of approximately $1200. However, it can change based on your gross income.

If your gross income is higher than the amount mentioned in the eligibility criteria, the money received as the stimulus check will decrease. And if your income goes above $99,000, you won't receive a stimulus check.

During the Great Recession in 2008, the government provided $300 to $600 as a stimulus check.

For the first COVID-19 stimulus check round, the authorities provided $1200 per adult. As part of the American Rescue Plan 2021, the US government facilitated $1400 per adult.

● If you are the head of a family

If you are the only tax-paying member in your family, you can receive $1200 when your gross income is $112,000. But, if your gross income exceeds $146,500, you won't get any stimulus check from the government. Therefore, keep track of your finances and taxes to gain clarity on the same before filing your taxes.

● If you are a couple, filing taxes together

Couples filing their taxes jointly can get $1200 if their gross income is less than $150,000. However, if your income is $198,000 and above, you won't get any stimulus checks. If you have children, for each child, you can get $500. But, the child has to be under 17 years for you to gain this benefit.

During the Great Recession, the government offered $600 to $1200 for couples filing joint taxes. Here, for each child, they provided $300. As part of the COVID-19 stimulus programs, married couples received around $2400, and those with two children got $3400 as part of the stimulus programs.

Thus, you have to file your taxes on time by providing the correct information to receive these benefits from the IRS. The IRS will furnish stimulus checks after cross-checking and verifying your tax filings and returns. Besides, there are different policies for senior citizens, SSDI recipients, and railroad retirees who don't have to file tax returns.