If you’ve never really thought about how the IRS calculates the size of your, now’s the time. Some pretty complicated formulations go into the process, starting with . As long as you’re — and remember, especially because of the , not everyone does — relies on equations that involve and how many .
That may be the “simple” answer to the, but it isn’t the complete picture. Another layer beneath that is a formula that’s actually written into the language of . This equation is what decided the US Treasury will — or has — cut in your name.
What’s interesting and important about thisis that it uses the same equation as the first one, and that as a result, some people won’t be eligible this time around. That’s right, because of the way the formula works. Some may still qualify, but for a than other people who meet the exact same eligibility requirements. (By the way, here’s what’s happening with a .) This story was recently updated.
How the IRS calculates your stimulus check total
The two major variables being plugged into the equation are youryou put on your 2019 federal tax returns into a formula, and the number of you claim. If the result is under a maximum limit, you will receive at least some stimulus check money. If the number is above it, you won’t receive any. ( .)
There’s a sliding scale involved. As with the first check, if, is less than $75,000 as a single taxpayer (that means no kids), you’ll receive the entire . If you made more than that, the size of your check would diminish until it hits the income limit, after which point you’d be ineligible.
This is the same equation that the IRS used for the first, $1,200 stimulus check. But the fact that this check is $600 actually lowers the maximum income limit you could hit, which means that more people will reach that limit sooner. A $600 flat payment for children 16 and younger could help mitigate your overall total (more below, it gets complex).
This chart helps illustrate the income limits and the difference between the first and second stimulus checks.
Stimulus check income limits ($600 and $1,200 checks)
|AGI to receive full amount (Both stimulus checks)||Second stimulus check upper income limit (AGI)||First stimulus check upper income limit (AGI)||Difference between upper limits||Percentage difference between upper limits|
|Single tax filer||Under $75,000||$87,000||$99,000||$12,000||14%|
|Head of household||Under $112,500||$124,500||$146,000||$21,500||17%|
|Married, filing jointly||Under $150,00||$174,000||$198,000||$24,000||14%|
What happens when you add $600 for your kids?
This is where the calculations get really interesting. The numbers in the chart above don’t include the $600 flat rate forin the second stimulus check (this is up from $500 with the first stimulus check). There’s no cap on the number of child dependents that count toward your total check, as long as they’re younger than 17 years old.
The IRS’ equation begins with the largest amount you’d be eligible to receive ($600 per single taxpayer or $1,200 for joint filers), and adds $600 for each qualifying child. Then it reduces the total possible sum according to your AGI.
It’s a little like starting a test with a perfect 100 point score 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 get more than people who don’t have dependents — even if your AGI is above the maximum cap. The more child dependents you have, the higher your starting value, and the higher your ending value, too.
That’s why it’s possible you could be out of range for a payment based on your AGI, but still receive a partial payment on the strength of your eligible dependents. Still confused? We don’t blame you. You can experiment with ranges in ourand see below for more sums.
Here’s the stimulus check formula in action
We want to show you the calculation at work, and how the math changes for people who claim dependents.
Remember that with the second check, an individual can qualify for a stimulus check of up to $600, a married couple who file taxes jointly can get up to $1,200 — and there’s an extra $600 per. Note that 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 explicitly included in the chart below.
These figures are based on the rules set out for the second stimulus check, worked out using. They’re best considered estimates only, since that could determine your final sum. If the amount below looks higher than what you receive, though, you may need to investigate a .
Stimulus check calculations with dependents ($600 second check)
|Head of household||Married couple, filing jointly|
|Estimated total with:|
|AGI of $40,000 and 0 dependents||$600 for single taxpayer with no children||$1,200|
|AGI of $115,000 and 0 dependents||Single filers not eligible||$1,200|
|AGI of $190,000 and 0 dependents||Single filers not eligible||Not eligible|
|AGI of $40,000 and 1 dependent||$1,200||$1,800|
|AGI of $115,000 and 1 dependent||$1,070||$1,800|
|AGI of $190,000 and 1 dependent||Not eligible||Not eligible|
|AGI of $40,000 and 2 dependents||$1,800||$2,400|
|AGI of $115,000 and 2 dependents||$1,675||$2,400|
|AGI of $190,000 and 2 dependents||Not eligible||$400|
What does it mean for a third stimulus check?
There’s already talk ofthat could yield a . Some are calling for it to be . If that were to happen, the pattern of the first two checks indicates that for the sake of simplicity, a future bill could once again direct the IRS to use the same formula.
If a future check were larger than the $1,200 from the first stimulus payment, you could expect the income cap to rise, making more people eligible for a higher sum of money overall.
It’s possible we could also see another bid to expand the definition of a dependent, such as. (This isn’t law.) A move in this direction would also make families eligible to receive money on behalf of college students and older live-in relatives.
Both hypothetical changes would potentially increase the 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.
For more information, here are the top things to. And see how , and people who can also qualify.