A stimulus check is a payment the government makes to taxpayers to increase their purchasing power. When people use this money on various goods and services, it helps sustain the economy. Stimulus checks are usually issued during economic crises, such as a recession. The government may also issue them when the country’s economy is disrupted due to unexpected global events.

Understanding stimulus checks
During economic distress, the government  makes direct payments to  people through stimulus checks. If someone is eligible, they can  choose to  receive a conventional paper check or have the amount directly deposited into their bank account. Stimulus checks aim to boost consumers’ confidence and encourage them to spend. When they use the money to buy something or avail of services, the economy gets a boost, helping the government get out of the crisis as soon as possible.

Now, not  everyone receives these payments. Individuals must meet the stimulus check eligibility criteria to receive federal financial support. For example, citizens and residents who do not depend on another person’s tax returns can qualify to receive these checks. The government can also exclude people from the scheme based on their income. So, if someone’s adjusted gross income (AGI) is quite high, they may not be eligible.

The amount of money a person receives through the stimulus check will vary depending on their tax filing status. For example, if someone has unpaid back taxes, the stimulus checks will be automatically used to pay off the outstanding balance.

History of stimulus checks
Years ago, during the country’s financial crisis related to home mortgage debt, the government introduced a solution to provide stimulus checks. These were given to those eligible to sustain the unemployment rate below 8%. Over the years, the government has sent similar stimulus checks during times of financial crisis. For instance, during the recent health crisis, several economic operations closed down, leading to a loss of livelihood for many people. At this time, several families received stimulus checks, which helped them spend money on necessities and keep the economy running.

Eligibility for stimulus checks
Only those who meet the stimulus check eligibility criteria will receive the payments handed out by the federal government. Since there are no new stimulus check eligibility requirements, one can consider the criteria of the past years to understand if they can expect to relieve stimulus checks in the future. Here’s a stimulus check eligibility calculator from the previous years-

• Citizens or residents
  The first eligibility requirement is to be a permanent resident  or citizen  of the country or a qualifying resident alien.
• Tax filing status and income limits
  A person’s tax filing status and AGI on their tax return also determine their eligibility and the amount they receive through the stimulus checks. To know the correct amount, one can check the official IRS resources. Last time, those who filed their taxes as “single” or “married filing separately” received the entire stimulus check value only if their AGI was below a certain threshold. As one’s AGI increased, the receivable amount decreased. And if one’s income exceeded a specific limit, they did not receive a stimulus check. Similar eligibility criteria were applied to married couples who filed their taxes jointly, but their qualifying AGI threshold was slightly higher than those filing individually.
• Heads of households
  Legal heads of households who did not exceed a certain AGI could receive the stimulus checks.
• Dependents
  In previous years, stimulus checks were also issued to qualified dependents, including certain adult dependents and children.
• Tax return filing
  Only those who filed their tax returns received stimulus checks. That said, there were exceptions for recipients of Social Security coverage and railroad retirees. Individuals in this category qualified for stimulus checks even if they had not filed their tax returns.

Difference between tax credits and stimulus checks
Stimulus checks are direct payments from the government to tax-paying individuals. These payments help immediately boost the country’s financial activity. The goal is to stimulate the economy by boosting consumer confidence and encouraging people to spend more. On the other hand, tax credits are a form of financial relief that aims to lower a person’s annual tax liability. They  bring down the actual amount of tax someone owes at the end of the financial year.

Where to look for stimulus checks?
Individuals can access their Internal Revenue Service (IRS) account to look for the various economic impact payments or stimulus checks issued. This account can be found in the agency’s official portal. People will need their Social Security Number (SSN) and related information to log in and verify their identity. In addition to looking for stimulus checks, one can use this service to view tax history, make tax payments, or make payment arrangements.