Everything You Need To Know About Plus-Up Stimulus Payments – Forbes

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Did you get a surprise payment from the government?

Many Americans are receiving unexpected payments from the IRS in their bank accounts. If you’re a lucky recipient, you may be wondering why you’re receiving extra cash—and the short answer is you’re receiving money that you’re entitled to, called a ‘plus-up’ stimulus payment.  

Calculator: Estimate Your Third Stimulus Payment

These plus-up payments started being processed on March 26. Here’s how they work and who qualifies.

How Plus-Up Stimulus Payments Work

When the first stimulus payments were sent, the amount you received was determined by the most recent tax information the IRS had on file for you. For many Americans, that was their 2019 tax return, as they hadn’t yet filed their 2020 taxes. 

Millions of Americans received partial—or no—stimulus payments based on their 2019 income. The maximum third stimulus payment amount for an individual is $1,400.

The income thresholds are:

  • Single filers see payments reduced for adjusted gross incomes (AGI) is above $75,000. Those making $80,000 and over do not qualify for a payment.
  • For married couples filing jointly, the phaseout begins at an AGI of $150,000. Those making $160,000 and over do not qualify for a payment. 
  • Heads of households see reductions at $112,500. Those making $120,000 and over do not qualify for a payment.

But the IRS is aware that many Americans saw their incomes drop in 2020 during the pandemic. Those who received the most recent stimulus payment based on their 2019 tax return, but then filed their 2020 tax returns which showed a lower AGI, may receive a plus-up payment. This payment is the difference between what they initially received based on their 2019 income, and what they were entitled to based on their 2020 income. 

For example: If an individual with no dependents made $76,000 in 2019, they would have received $1,120 as their most recent stimulus payment, since their AGI was above the $75,000 maximum for the full $1,400 stimulus payment.

If their AGI dropped to $50,000 based on their 2020 filing, the IRS would send them a ‘plus-up’ payment of $280 for them to receive the maximum stimulus amount of $1,400, since they now qualify based on their 2020 return.

Additionally, if you didn’t report a dependent on your 2019 tax return, but now do on your 2020 return, the IRS will send a plus-up payment for the new dependent, if your household AGI is below $80,000 as a single filer or $160,000 if married filing jointly. 

Read More: Third Stimulus Check FAQs

The IRS started processing plus-up payments on March 26 with an official payment date of March 31. The IRS says over 1 million plus-up payments have been made, totaling more than $2 billion.

The good news: If you qualify for a plus-up payment, you don’t need to do anything to receive the additional amount aside from filing your 2020 tax return, according to the IRS. If you haven’t filed your 2020 tax return yet, and believe you’ll be eligible for a plus-up payment, you should file your tax return as soon as possible. The IRS says it will continue to send out plus-up payments “on a weekly basis going forward” as it continues to process tax returns from 2020.

The IRS is sending the plus-up payments according to the most recent information on file, which means a direct deposit to a bank account or by paper check to a direct mailing address, if a bank account isn’t on file or failed the IRS test of validity.

Haven’t received your third stimulus check yet? Check the IRS Get My Payment tool to track your stimulus payment. 

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