When the IRS grants the claim, they won't offset the couple's refund to pay those debts.
The IRS said that like the first batch of 90 million payments, this disbursement was primarily sent to those who filed 2019 or 2020 tax returns, or those who typically don't file a tax return but previous used the IRS' non-filer tool. It may indicate the tax agency either hasn't processed a person's payment or that people aren't eligible for a stimulus payment, the IRS has noted.
The Internal Revenue Service will issue another batch of $1,400 stimulus payments this week, the agency announced.
A large number of the latest batch of payments will be mailed for those who do not receive a direct deposit. "As of today, SSA still has not provided the IRS with the payment files that are needed to issue EIPs to these struggling Americans". But given that many get their federal payments through direct deposit to their bank account, they are perplexed over why it's taking the tax agency more time to deliver the checks to them than to others.
The agency is now in the midst of delivering a second batch of checks: Checks being delivered via direct deposit started processing on Friday and will be available by Wednesday, according to a joint news release from the Treasury Department, IRS and Bureau of the Fiscal Service. Those making over $80,000 ($160,000 for couples) will not receive a check.
The $1.9 trillion American Rescue Plan, signed by President Joe Biden on March 11, authorizes direct payments of up to $1,400 for individuals and $2,800 for couples, plus $1,400 for dependents.
On what year are the income limits based?
The IRS has prioritized delivering the checks to people who have either filed their 2020 or 2019 tax returns, as well as those who used the "Non-Filers" website that the agency operated past year. "We demand that you immediately provide the IRS this information by tomorrow, March 25, 2021".
If your 2019 income was less than your pay in 2020, you will not owe back any money.
People who receive Social Security retirement benefits, survivor or disability benefits (SSDI), Railroad Retirement benefits, Supplemental Security Income (SSI), or Veterans Affairs benefits are eligible for the payments that were authorized as part of the American Rescue Plan Act, even if they don't file a tax return. Recipients with unpaid credit card or medical bills for which a company has obtained a judgment against the debtor could see the fresh infusion taken from their bank accounts, potentially preventing those in need from getting the emergency cash.
Democrat Sen. Sherrod Brown of OH introduced a bill last week that would fix the problem, but it has yet to be taken up for a vote.