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The stimulus check formula might change, and with it, the sum of money you possibly can obtain in a 3rd check.


Sarah Tew/CNET

When it comes to the $1,400 stimulus check, it appears everybody in Washington is doing the math. Whether you get the third stimulus check that’s at the moment underneath negotiation in the Capitol or not might come down to the precise formula utilized in the remaining laws. The equation for calculating how a lot cash every particular person and family might get might be perplexing, and for the third iteration of stimulus funds, Congress might change the calculation it used for the first two stimulus checks.

This week, 10 Republican senators proposed sending $1,000 funds that may change the most check quantity, plus two extra variables in the stimulus check formula: the higher restrict and the “reduction rate,” which is the share per $1,000 of adjusted gross earnings {that a} check is decreased by. Taken collectively, it could imply far fewer folks would qualify for a 3rd check if this $600 billion proposal have been hypothetically adopted with none extra adjustments.

While Biden has rejected the $600 billion proposal and renewed his dedication to a $1,400 check, he has additionally thought of utilizing the decrease earnings restricted wanted to qualify. We’ll share some examples of how issues might change in the third formula and why that issues. Here are the high issues to find out about stimulus funds proper now, together with when a 3rd check might arrive.

How the IRS calculates your stimulus check quantity

You can qualify for a stimulus check in the event you’re a nonfiler who would not pay taxes, however normally, your tax return is certainly one of the most necessary components in figuring out your stimulus check complete. The others embrace your AGI and the stimulus check formula.

The main variables being plugged into the formula’s equation are:

  • Your adjusted gross earnings you placed on your 2019 or 2020 federal tax returns.
  • Upper limits for single taxpayers, heads of family (e.g., a single individual with a minimum of one youngster) and married {couples} submitting collectively.
  • Number of eligible dependents you declare.
  • Reduction fee per $1,000 of earnings.

Assuming you qualify, the result’s underneath a most restrict, you’ll obtain a minimum of some stimulus check cash. If the quantity is above it, you will not obtain any. (If you do not sometimes file taxes, this is what it’s best to know.)

There’s a sliding scale concerned. For the first two checks, if your AGI was lower than $75,000 as a single taxpayer (meaning no youngsters), you’ll obtain the complete second stimulus check complete of $600. If you made greater than that, the dimension of your check would diminish till it hits the earnings restrict, after which level you would be ineligible.

For the $600 billion proposal and its $1,000 check, you possibly can obtain the full $1,000 quantity in the event you earn $40,000 a 12 months or much less (your AGI as a single taxpayer), however $50,000 or above can be the vanishing level. If you make greater than that, you would be out of luck — no check. Double that to $100,000 for married {couples}. The $600 billion proposal would additionally enhance the discount fee, which signifies that you’d get much less cash per $1,000 you make, till you hit that $50,000 vanishing level the place you would not get any cash in any respect. Children change the equation, however extra on that under — it will get complicated.


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Stimulus check No. 3: What you need to know



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$600 vs. $1,400: What the differences can tell us

Biden’s third stimulus check proposal — for $1,400 — isn’t settled on how it could change any variables other than the maximum amount. Based on that, we’ve used our stimulus calculator tools to tabulate differences in the income limit (the absolute AGI cutoff) between the second stimulus check for $600 and a potential third check for $1,400, if the formulas are otherwise the same.

The results below demonstrate that more people would be eligible for a check — and a larger check at that — when the maximum limit goes up (but nothing else changes). The $600 billion GOP proposal is one example of how some would seek to target the third stimulus check, to make it possible for people who make less than a set amount to get more money.

$600 vs. $1,400 stimulus check income limits

AGI to receive full amount (Both stimulus checks) Second stimulus check upper income limit (AGI) $1,400 stimulus check upper income limit (AGI) Difference between upper limits Percentage difference between upper limits
Single tax filer Under $75,000 $87,000 $103,000 $16,000 18%
Head of household Under $112,500 $124,500 $140,500 $16,000 13%
Married, filing jointly Under $150,00 $174,000 $206,000 $32,000 18%

How does adding money for each dependent work?

This is where the calculations get really interesting. The numbers in the chart above don’t include the $600 flat rate for child dependents in the second stimulus check, or the $500 for dependents of any age that’s proposed in the $600 billion framework. There’s no stated cap on the number of dependents that count toward your total check. 

Regardless, the way the equation breaks down would be the same as far as we can tell right now. Let’s use the second stimulus check as the main example. The equation — which is written into the stimulus bill, by the way — 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 our second stimulus check calculator and third stimulus check calculator, and see below for more sums.

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A third stimulus check could be dramatically different from the first two.


Angela Lang/CNET

The stimulus payment formula

We want to show you the calculation at work and how the math changes for people who claim dependents. 

Let’s use the two third stimulus check proposals as our guidelines. With Biden’s $1,400 plan, an individual can qualify for a stimulus check of up to $1,400, a married couple who file taxes jointly can get up to $2,800 — and there could be an extra $600 per qualified dependent. Note that a head of household 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. 

For the $600 billion proposal from the group of 10 Republican senators, you see a $1,000 stimulus check maximum per single taxpayer, and $2,000 per married couple, but with a much lower income limit. There’s also a $500 bonus for each dependent, regardless of age.

These figures have been worked out using CNET’s third stimulus check calculator. They’re best considered estimates only, since secondary qualifications other than income could influence your final sum.

$1,400 vs. $1,000 stimulus check (Biden vs. $600B GOP proposal)

Head of household Married couple, filing jointly
Estimated total with:
$40,000 and no dependents [$1,400 Biden] $1,400 (single taxpayer) $2,800
$40,000 and no dependents [$1,000 GOP] $1,000 (single taxpayer) $2,000
$80,000 and no dependents [$1,400 Biden] $1,150 (single taxpayer) $2,800
$80,000 and no dependents [$1,000 GOP] Not certified Not certified
$40,000 and 1 dependent [$1,400 Biden] $2,000 $3,000
$40,000 and 1 dependent [$1,000 GOP] $1,500 $2,500
$80,000 and 1 dependent [$1,400 Biden] $1,750 $3,400
$80,000 and 1 dependent [$1,000 GOP] Not certified $2,500
$40,000 and a pair of dependents [$1,400 Biden] $2,600 $4,000
$40,000 and a pair of dependents [$1,000 GOP] $2,000 $3,000
$80,000 and a pair of dependents [$1,400 Biden] $2,600 $4,000
$80,000 and a pair of dependents [$1,000 GOP] Not certified $3,000

Which different methods might a 3rd stimulus check change?

If the third stimulus check did not change the formula from the first two funds, however the complete per individual did rise, this is what you possibly can count on:

  • People who bought the first two checks would get more cash (as a result of the $1,400 higher restrict is larger).
  • More folks might qualify as a result of the earnings restrict threshold would rise, which might additionally increase the cutoff level for receiving no payment in any respect. We speak extra about that right here.

Biden’s stimulus plan additionally seeks to change stimulus check {qualifications} that may enhance the household’s total pool for tens of tens of millions of individuals, together with cash for dependents of any age, and for households with “mixed-status” citizenship. Remember, the larger the sum a household begins with, the larger the check they’re possible to obtain after the IRS makes its deductions primarily based on your AGI. 

For extra data, listed below are the high issues to find out about stimulus checks. And see how SSDI recipients and checksolder adults and retirees and individuals who aren’t US residents or Americans who do not dwell in the US may also qualify.

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