IRS starts depositing third round of stimulus payments

The Internal Revenue Service said Friday that the third round of Economic Impact Payments will begin hitting taxpayers’ bank accounts as early as this weekend.

After President Biden signed the American Rescue Plan Act into law on Thursday, the first batch of $1,400 payments will be submitted by direct deposit this weekend, with more arriving in the week ahead. More batches of payments will be sent in the forthcoming weeks via direct deposit and through the mail as a check or debit card. Most of the payments will be issued by direct deposit. No action will be needed by most taxpayers, but in some cases taxpayers will need to go online and enter or update their information on the IRS website.

The $1,400 Economic Impact Payments come after the $600 payments that were sent earlier this year after passage of the Consolidated Appropriations Act in December and the $1,200 payments last year under the CARES Act last March. Together they represent an unprecedented amount of aid distributed by the federal government to help Americans cope with the economic crisis from the COVID-19 pandemic. Each time, however, many taxpayers have experienced problems getting the payments and many are still waiting for the first payment to arrive.

Taxpayers can access the IRS's “Get My Payment” tool on Monday to see the payment status of the third stimulus payment. “Even though the tax season is in full swing, IRS employees again worked around the clock to quickly deliver help to millions of Americans struggling to cope with this historic pandemic,” said IRS Commissioner Chuck Rettig in a statement. “The payments will be delivered automatically to taxpayers even as the IRS continues delivering regular tax refunds. We urge people to visit IRS.gov for the latest details on the stimulus payments, other new tax law provisions and tax season updates.”

The IRS plans to automatically calculate the amounts of the payment based on tax information from prior years. In general, most people will get $1,400 for themselves and $1,400 for each of their qualifying dependents claimed on their tax return. As with the first two Economic Impact Payments in 2020, most taxpayers will get the money without having to take any action. Some taxpayers may see the direct deposit payments showing up as pending or as provisional payments in their bank accounts before the official payment date of March 17. Because these payments are automatic for most eligible people, contacting either financial institutions or the IRS on payment timing won’t hasten their arrival.

The IRS has already gotten plenty of experience in delivering Economic Impact Payments after delivering the first two rounds in the past year, but the work is certain to delay the IRS’s work on tax season. The agency had to push back the opening of tax season by about two weeks this year to deliver the second round of payments, and some lawmakers and accounting groups are urging the IRS to extend tax season by another two or three months. “Amid the many pressing priorities at hand, I’m heartened by Treasury Secretary [Janet] Yellen’s leadership in directing the IRS to start depositing payments this weekend,” said House Ways and Means Committee chairman Richard Neal, D-Massachusetts, in a statement. “The American people are counting on this support and it has always been the intent of the Ways and Means Democrats that these would be distributed as soon as possible. While I am impressed with this phenomenal turnaround, taxpayers will have questions for the IRS about their stimulus payments, on top of questions related to the filing season and other provisions in the American Rescue Plan. As the pandemic continues to impact IRS operations, the end of the filing season must be delayed.”