AMERICAN RESCUE PLAN DETAILS
May 26, 2021 - Douglas Myser
American rescue plan details. The American Rescue Plan Act of 2021 was signed by President Biden on March 11, 2021. The Act has unemployment benefits, vaccination programs and additional unemployment benefits meant to get people through the COVID-19 crisis. More funding for state and local governments was included, assistance to schools to help them open up safely and a number of tax provisions were also included. Recovery rebates to individuals under Section 9601 were added to the bill. The Act provides for stimulus payment of $1400 per person which includes, the taxpayer, spouse, and any dependents, regardless of age. The payment amount phases out for single filers with an adjusted gross income over $75,000 and is not available for adjusted gross income over $80,000, the phase out amount for joint returns starts at $150,000 and is not available for adjusted gross income over $160,000, and the phase out starts at $112,500 for head of household and is not available for adjusted gross income over $120,000. American rescue plan details.
As with the prior two stimulus payments, the amount received will be reconciled on the 2021 return when prepared in 2022. The amount received is based on the 2020 income tax number such as the returns otherwise the adjusted gross income from the 2019 return will be used to determine eligibility. The stimulus payment is only available to those with a valid identification number such as the Social Security number or the adoption identification number. There is a special rule for members of the Armed Services where at least one spouse is a member of the Armed Forces and has a valid identification number then the spouse with the ITIN will qualify for the stimulus payment. An amendment by the Senate modified the offset provision so that both the advance and any additional credit on the 2021 tax return will not be retained for any outstanding tax liability. The provisions in the bill give tax relief to a wide range of Americans.
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