Economic Impact Payment 3 vs EPI1 and EPI2

The third Economic Impact Payment (EIP3) is different from the first and second payments in several ways.

The Third Economic Impact Payment Is an Advance Payment of the 2021 Recovery Rebate Credit

The two earlier payments are advance payments of the 2020 Recovery Rebate Credit. Eligible people who did not get a first and second Economic Impact Payment or got less than the full amounts may be eligible to claim the 2020 Recovery Rebate Credit. If you are one of those eligible individuals, you must file a 2020 tax return even if you don’t usually file a tax return.

The Third Economic Impact Payment Will Be Larger for Most Eligible People

Eligible individuals who filed a joint tax return will receive a third Economic Impact Payment up to $2,800, and all other eligible individuals will receive up to $1,400. If you have qualifying dependents on your tax return, you will receive up to $1,400 per qualifying dependent.

More People Qualify as Dependents

Unlike the first two payments, the third payment is not restricted to children under 17. Eligible families will get a payment for all qualifying dependents claimed on their return. Qualifying dependents may include older relatives like college students, adults with disabilities, parents, and grandparents.

Income Phase-Out Amounts Are Different

You will not receive the third payment if your Adjusted Gross Income exceeds:

$160,000, if married and filing a joint return or filing as a qualifying widow or widower.
$120,000 if filing as head of household.
$80,000 for eligible individuals using other filing statuses, such as single filers and married people filing separate returns.

This means that some people won’t be eligible for the third payment even if they received first or second EIPs or are eligible for a 2020 Recovery Rebate Credit.

Some People May Be Eligible for a Supplemental Payment

The amount of the third payment is based on your latest processed tax return from either 2020 or 2019. If your 2020 return hasn’t been processed, the IRS used 2019 tax return information to calculate the third payment.

If the third payment is based on the 2019 return and is less than the full amount, you may qualify for a supplemental payment. After your 2020 return is processed, the IRS will automatically re-evaluate your eligibility using your 2020 information. If you are entitled to a larger payment, the IRS will issue a supplemental payment for the additional amount.

Changes to Earlier Eligibility Requirements

For taxpayers who file jointly and only one individual has a valid SSN, the spouse with a valid SSN will receive up to a $1,400 third payment and up to $1,400 for each qualifying dependent claimed on their 2020 tax return.

For taxpayers who don’t have a valid SSN but have a qualifying dependent who has an SSN, they will only receive up to $1,400 for a qualifying dependent claimed on their return only if they meet all other eligibility and income requirements.

If either spouse was an active member of the U.S. Armed Forces at any time during the taxable year, only one spouse needs to have a valid SSN for the couple to receive up to $2,800 for themselves plus up to $1,400 for each qualifying dependent.

If married taxpayers filing jointly did not receive one or both of the first two Economic Impact Payments because one spouse did not have a Social Security number valid for employment, they may be eligible to claim a 2020 Recovery Rebate Credit on their 2020 tax return for the spouse with the SSN valid for employment.

A Final Note

The fifth batch of payments began processing on Friday, April 9, with an official payment date of April 14. Some people began receiving direct payments in their accounts earlier as provisional or pending deposits. To verify the status of your payment or deposit, use the Get My Payment tool on IRS.gov.

Stay safe. Stay well.

Economic Impact Payment 3 vs EIP1 and EIP2