A Stimulus Check is a one-time payment from the government meant to stimulate consumer spending in times of economic crisis. These payments are typically aimed at increasing confidence among consumers while encouraging consumption, which helps boost growth and increase the value of the dollar.
The first stimulus checks were distributed in March 2020 as part of the Coronavirus Aid, Relief and Economic Security (CARES) Act. The second set was distributed on Dec. 29 in response to the COVID-19 pandemic. In both cases, the checks were direct deposited or mailed to taxpayers. For those who already filed their taxes in 2019, the payment was automatically processed through the IRS and sent via direct deposit or a paper check to the same address that was on the 2019 return.
Demystifying Stimulus Checks: What You Need to Know
To qualify for a Stimulus Check, you must have a Social Security number or Individual Taxpayer Identification Number (ITIN). Your spouse and children also need to have SSNs or ITINs in order to receive the payment. In addition, the income requirements are different for the third stimulus check compared to the first and second. Those earning more than $75,000 (or $150,000 for married filers or $112,500 for head of household) are ineligible to receive the full amount.
The goal of the program is to increase consumption, which leads to more investment and employment in the economy. However, there are concerns that consumers will spend the money on non-essential items that don’t stimulate growth or help with job creation. Additionally, the government is taking on a huge sum of debt to distribute the stimulus checks, which may be risky for future generations.