There are a number of legitimate reasons why money might be deducted from your stimulus payment.
As millions of people get their latest stimulus payment, some are surprised to find they're not getting as much as they expected.
"I got my check today but it was only $1,077. Are others getting shorted also?" 13News viewer Randy asked Verify.
Randy wondered why his stimulus payment was $323 less than anticipated, and he's not alone. Others have contacted 13News Verify to ask why money had been deducted from their third stimulus payment, as well.
Why might you get less than expected, and can the IRS or others seize money from your stimulus payment?
Our sources
The Internal Revenue Service, the National Consumer Law Center, the CARES Act and the American Rescue Plan, which is the legislation Congress passed to create the latest stimulus.
What we found
The IRS could not explain to Verify exactly why Randy’s stimulus check was missing $323, but a spokesman did offer several scenarios in which stimulus payments can be reduced.
INCOME PHASE OUT:First, depending on your income, there is a small phase-out window that could reduce how much you get. As your income goes up, your stimulus payment goes down.
For example, someone making more than $75,000 but less than $80,000 in adjusted gross income will see their payment reduced from the full amount. If your latest stimulus check is $700 – half of the maximum amount eligible residents are entitled to – it is likely due to your income falling within the phase-out window. Individuals earning more than $80,000 in adjusted gross income ($160,000 for couples) do not qualify for the latest stimulus.
PRIVATE DEBT COLLECTION:Congress prohibited debt collectors from seizing last year’s stimulus payments, but they could not do that this time around because the third stimulus bill was passed through a process called budget reconciliation. So, if you owe money for privately held debt, such as private student loans, credit card debt or medical debt, a debt collector can access your stimulus funds through your bank account.
The American Bankers Association, National Consumer Law Center and other consumer and financial groups recently issued an urgent plea to change that.
They sent a letter to Congress and the US Treasury, urging them to enact a stand-alone bill to protect stimulus payments from being seized by debt collectors.
Some states already have laws or Executive Orders to prevent debt collectors from seizing stimulus payments but, so far, Indiana has not enacted such a law.
GOVERNMENT GARNISHMENTS:The government cannot seize money directly from your third stimulus payment to offset state and federal debts – with a notable exception. If you apply to get your stimulus payments as a tax refund through a Recovery Rebate Credit, that refund can be garnished for debts, such as overdue child support and money you owe for state and federal taxes.
So, we can verify: There ARE a number of legitimate reasons why money might be deducted from your stimulus payment. If you think the IRS simply made a mistake, the agency says it will make things right.
“The bottom line is if you’re owed more than you received, there will be a way later this year to work that out," IRS spokesman Luis Garcia told 13News Verify.
He said the IRS will announce how to do that through a series of Frequently Asked Questions on its website in the next few days.
If you have a question for the 13News VERIFY Team, send us an email at VERIFY@wthr.com.
FAQs
The general rule is that the IRS will not use your stimulus check to offset what you owe the government.
Which stimulus check cannot be garnished? ›
Unlike the second stimulus payment, which was protected against garnishment from private debt collectors after the first round of checks lacked protections, the third round of stimulus checks also don't include garnishment prohibitions.
How can I verify my stimulus payment? ›
Check the status of your stimulus check on the IRS Get My Payment website.
Can the bank take my stimulus check if I owe them money? ›
As for upcoming payments, under the terms of the American Rescue Plan, your $1,400 stimulus check cannot be garnished for unpaid federal or state debt. However, the money may be garnished for unpaid private debts, such as medical bills or credit card debts, provided they are subject to a court order.
Can your stimulus check be garnished? ›
If you have unpaid private debts that are subject to a court order, your $1,400 stimulus check could be garnished. The American Rescue Plan Act did not protect the one-time direct payments for people in those circ*mstances. Some states have stepped in to enforce their own rules to make it so the money cannot be taken.
What happens when the stimulus is removed? ›
Negative reinforcement is removing a stimulus as the consequence of behavior but results in a positive outcome for the individual. For example, a fine is dropped, and a person no longer has to go to jail. The removal of the negative stimulus (the fine) results in a positive outcome for the individual, no jail time.
What disqualifies you from the stimulus check? ›
Individual taxpayers with AGI of $80,000 or more aren't eligible. The new stimulus check will begin to phase out after $75,000, per the new "targeted" stimulus plan. If your adjusted gross income, or AGI, is $80,000 or more, you won't be eligible for a third payment of any amount.
What debt collectors can take your stimulus check? ›
Who Can Take Your Stimulus Check?
- Federal or State Tax Debt: No. Your stimulus payment will not be taken to offset past-due federal debts. ...
- Federal Student Loan Debt: No. ...
- Bankruptcy: Probably Not. ...
- Child Support: No. ...
- Credit Card Debt: Yes. ...
- Delinquent Loan Debt: Yes. ...
- Debt Collections: Yes. ...
- Research Laws in Your State.
In other words no you can't sue anyone for the stimulus money.
How do I know if my stimulus check is real or fake? ›
All U.S. Treasury checks are printed on watermarked paper. When held up to the light, the watermark reads “U.S. Treasury” from both the front and the back. Any check should be suspected as counterfeit if the check has no watermark, or the watermark is visible without holding the check up to light.
Many taxpayers never claimed their 2021 stimulus checks, according to an August 2023 report. But there is still time to claim that payment by filing a tax return and claiming the Recovery Rebate Credit.
Is there an app to check on the stimulus check? ›
Stimulus Check Guide app help you to check your IRS stimulus check payment, California stimulus checks and other various other states. Stimulus Check Guide app help you to check your IRS stimulus check payment, California stimulus checks and other various other states.
What happens if my bank account is closed for stimulus check? ›
If the IRS sends your direct deposit to a closed bank account, the payment will be reissued by mail to the address on file with the IRS. That payment will either be a physical check or what's called an EIP Card.
What happens if someone cashes your stimulus check? ›
You either want your money or don't. What happens if someone cashed my stimulus check? Actually it's considered fraud you would have to report that the IRS. They actually stole it from your possession ability to file charges local law enforcement department.
What happens if your stimulus check goes to a closed bank account? ›
If a stimulus payment is made to a closed account, the bank will refuse the funds. Also, if IRS attempted to transfer your payment to a now-closed bank account or a temporary prepaid debit card set up for you by a tax preparer, your check may bounce.
Why is IRS asking for stimulus money back? ›
You earned too much money
Each of the three stimulus checks were tied to an income threshold. Once that threshold was met, the amount of their stimulus check was reduced.
Can I still receive my stimulus checks? ›
It's not too late to get any missed stimulus checks! You will need to file a 2020 tax return to get the first and second stimulus checks and a 2021 tax return to get the third stimulus check. You must file a 2020 tax return by May 17, 2024.
Can I still get a stimulus check if I haven't done my taxes? ›
Yes, you can still get your stimulus checks if you haven't filed your 2020 and 2021 tax returns and didn't receive the stimulus money. To claim your stimulus payment, file your 2020 and 2021 tax returns and apply for the Recovery Rebate Credit on these returns.
Can the third stimulus check be offset? ›
I owe delinquent debt. Will my 3rd Economic Impact Payment under American Rescue Plan Act of 2021 be offset through TOP? No, the Economic Impact Payment, authorized by the American Rescue Plan Act of 2021, is not subject to offset for any reason through TOP, when paid as an advance.
