The new coronavirus relief package signed into law by President Biden last week includes some important tax provisions.
Economic impact payments of up to $1,400 per person started being deposited on Monday March 14th. If your income is less than $75,000 as a single person or less than $150,000 as a married couple you should receive a full payment. The payment amount is phased out for income levels between $75,000 and $80,000 for singles and between $150,000 and $160,000 for married couples. If you do not receive the full payment due to you, you can apply for the payment on your 2021 tax return.
If you received unemployment benefits in 2020, the first $10,200 in benefits are tax free. If you filed you tax return before the new relief package was law, the IRS will credit you for the overpaid tax and, in most cases, send you the payment.
The relief bill also increased the child tax credit for children under 17 of qualified taxpayers from $2,000 to $3,000. This provision does not become effective until 2021.