Stimulus Package Law: When Can Americans Expect It?

The American Rescue Plan Act of 2021, also known as the COVID-19 Stimulus Package, was passed by the 117th United States Congress and signed into law by President Joe Biden on March 11, 2021. The $1.9 trillion economic stimulus bill aimed to speed up the country's recovery from the economic and health effects of the COVID-19 pandemic and recession. The Act provided for direct economic stimulus payments to individual taxpayers, allocated funds for vaccine distribution, and extended unemployment benefits, among other initiatives.

In December 2024, the IRS announced plans to send a total of $2.4 billion in special payments of up to $1,400 to approximately 1 million taxpayers. These payments were intended for those who did not receive the full amount of their pandemic stimulus payments, known as Economic Impact Payments (EIPs). The IRS stated that eligible taxpayers would receive a letter of notification and that the payments would be automatically deposited or sent by check.

Stimulus checks from the federal government

The IRS plans to send separate letters to eligible taxpayers notifying them of the special payment. The payments will be automatically deposited into eligible people's bank accounts or sent by paper check. The IRS said the payments will start going out this month and be issued to most recipients by late January 2025.

In addition to the federal government, several states have stepped in to provide financial relief to their residents through tax rebates and inflation relief payments. These include Alabama, Arizona, California, Colorado, Georgia, Maine, Massachusetts, Michigan, Minnesota, Montana, New Mexico, New York, Pennsylvania, South Carolina, and Virginia.

State stimulus checks

Alabama

Alabama's one-time tax rebate program for 2023 offered $300 for joint filers and $150 for single filers, based on previous tax year filings. The rebate program has concluded, and Alabama has not announced a new rebate initiative for 2024.

Arizona

Arizona's Families Tax Rebate program offered a rebate for up to three dependents. Qualifying taxpayers could receive the rebate for up to three dependents, with a maximum rebate of $750. The program is now completed. Arizona residents must report their 2023 Arizona Families Tax Rebate as federal taxable income.

California

California's Middle Class Tax Refunds (MCTR) program offered payments ranging from $200 to $41050. The program has concluded, but California has announced a new round of payments of up to $725 for eligible residents. The Golden State Stimulus Check program, also known as the California Earned Income Tax Credit (CalEITC), was initially launched during the COVID-19 pandemic to aid low-income families and people in California. Eligible beneficiaries may get up to $1,200, depending on their income and tax filing status.

Colorado

Colorado TABOR refunds, also known as "Cash Back" payments, are being sent to eligible Coloradans who meet age and residency requirements and have filed a Colorado income tax return for a specified year or applied for a property tax/rent/heat credit rebate. This year's TABOR refund is worth $1.7 billion, with individual refunds ranging from $177 to $1,130 per taxpayer, depending on income and filing status.

Georgia

Georgia offered tax rebates of up to $500 last year due to House Bill 162. The bill provided a one-time tax credit, or surplus tax refund, for Georgia taxpayers who filed state income tax returns for the 2021 and 2022 tax years and had a tax liability for the 2021 tax year. The refund program has ended, and Georgia has not announced a similar measure for 2024.

Maine

Maine offered Winter Energy Relief Payments of $450 for eligible residents ($900 for married couples) who filed a 2021 Maine personal income tax return as full-time residents by October 31, 2022, and did not have any dependents claimed on another person's tax return. The program has concluded, and it is unclear if Maine will offer similar payments in 2024.

Massachusetts

Massachusetts' 62F tax refund program, which returned about 14% of 2021 state income tax liability to eligible taxpayers, has ended. No new refunds have been announced for 2024.

Michigan

Michigan has expanded its earned income tax credit, known as the Working Families Tax Credit, and has been sending tax credit checks to eligible families since February 2024. The rebate checks are based on previous state tax returns and differ from any Michigan state tax refund eligible residents may receive for the 2023 tax year. The payments are expected to average $550 per family.

Minnesota

Minnesota sent rebate checks of up to $1,300 (also known as "Walz checks") to about 2.5 million households beginning in mid-August of last year. The rebates were made possible by a $3 billion tax relief bill signed by Governor Tim Walz. The rebates were sent automatically to eligible residents based on information from their previous state income tax returns. While the rebate program has concluded, Minnesota has not announced any new rebate programs for 2024.

Montana

Montana offered one-time income tax rebate checks of up to $2,500 and property tax rebates of up to $675 last year. The actual amount received depended on the details of taxpayers' 2021 tax returns. The program has concluded, and Montana has not announced any new rebate programs for 2024.

New Mexico

New Mexico rebate checks of up to $1,000 were sent to eligible residents last summer due to a fiscal year surplus from high oil prices. The amount of the rebate depended on the recipient's filing status for the 2021 tax year. The rebate program has ended, and New Mexico has not announced any new rebate initiatives for 2024.

New York

New York's School Tax Relief Program (STAR) is currently in progress. The program provides property tax relief to eligible homeowners in the form of a tax exemption or tax credit. New York state officials estimate the tax reduction per household will be about $290 for Basic STAR and $650 for Enhanced STAR (E-STAR).

Pennsylvania

Pennsylvania's "Property Tax/Rent Rebate" program offers rebates to eligible residents who are at least 65 years old, widows or widowers at least 50 years old, or people with disabilities who are at least 18 years old. There is also an annual income limit of $45,000 for homeowners and renters. The standard rebate amount depends on income and housing status, with a maximum rebate of $1,000 for eligible homeowners.

South Carolina

South Carolina offered tax rebates of up to $800 based on the previous year's tax liability. The program has concluded, and no similar rebate program has been announced for 2024.

Virginia

Virginia offered tax rebates of up to $400 for eligible joint filers and $200 for eligible single filers in 2023 due to a surplus in the state's finances. The program has concluded, and

IRS special payments

On December 20, 2024, the Internal Revenue Service (IRS) announced plans to send a total of $2.4 billion in "special payments" to approximately 1 million taxpayers. These payments are intended for eligible taxpayers who did not claim the Recovery Rebate Credit on their 2021 tax returns. The credit was designed for people who did not receive the full amount of their pandemic stimulus payments, known as Economic Impact Payments (EIPs).

The IRS special payments will be automatically deposited into the bank accounts of eligible individuals or sent by paper check. The payments will vary, with a maximum of $1,400 per recipient. The IRS has stated that these payments will start going out in January 2025 and will be issued to most recipients by late January 2025. The value of the credit will depend on various factors, including income, filing status, and the number of dependents.

For those who have not yet filed their 2021 tax returns, it is still possible to receive the special payment. However, taxpayers must file a tax return and claim the Recovery Rebate Credit by the deadline of April 15, 2025, even if their income was minimal or nonexistent.

It is important to note that these IRS special payments are separate from state-level "stimulus checks" or tax rebates being offered by certain states. These state-level payments may have different eligibility criteria, payment amounts, and delivery timelines.

Disaster relief

The bill aims to provide crucial support to Americans recovering from these disasters, with a focus on rural communities, farmers, and ranchers facing economic challenges and the aftermath of multiple disasters. It is designed to help rebuild and restore communities left in ruins, demonstrating resilience and unity in the face of tragedy.

Additionally, the American Rescue Plan Act of 2021, also known as the COVID-19 Stimulus Package, allocated funds for various forms of disaster relief. The Act provided $50 billion to the Federal Emergency Management Agency (FEMA) for vaccine distribution and assistance, with FEMA reimbursing up to $9,000 for funerals for COVID-19 victims. Furthermore, $47.8 billion was designated for COVID-19 testing, mitigation, and transmission prevention, including diagnosis, tracing, and monitoring.

The stimulus package also included funding for state and local governments, with $350 billion aimed at helping them bridge budget shortfalls and mitigate fiscal shocks. This funding was distributed among states, the District of Columbia, tribes, and territories, providing much-needed financial support to these entities.

The stimulus package also addressed disaster relief in the form of tax credits and grants to small businesses. The Paycheck Protection Program, for instance, received additional funding to support small businesses impacted by the pandemic. Furthermore, the Low-Income Home Energy Assistance Program received $4.5 billion to assist homeowners with heating and cooling costs.

Overall, the stimulus package incorporated a comprehensive approach to disaster relief, addressing both immediate needs, such as COVID-19 response and funeral assistance, as well as long-term recovery efforts for communities affected by natural disasters.

Tax rebates

Federal Level

The American Rescue Plan Act of 2021, also known as the COVID-19 Stimulus Package, was a $1.9 trillion economic stimulus bill passed by Congress and signed into law by President Joe Biden in March 2021. It provided for direct economic stimulus payments of up to $1,400 to individual taxpayers with incomes of $75,000 or less.

State Level

Several states have also provided financial relief to their residents through tax rebates and inflation relief payments. For example:

• Alabama offered a one-time tax rebate of $300 for joint filers and $150 for single filers, based on previous tax year filings.
• Arizona offered rebates to year-round residents who claimed the state's tax credit for dependents on their 2021 tax return.
• California's Middle Class Tax Refunds offered payments ranging from $200 to $41050.
• Colorado has been issuing TABOR refunds (also known as "Cash Back" payments) to eligible Coloradans who filed a Colorado income tax return for a specified year or applied for a property tax/rent/heat credit rebate.
• Georgia offered tax rebates of up to $500 in 2023 due to legislation known as House Bill 162.
• Maine offered Winter Energy Relief Payments of $450 to eligible full-time residents who filed a 2021 Maine personal income tax return.
• Michigan has been sending tax credit checks to families based on previous state tax returns.
• Minnesota sent rebate checks of up to $1,300 to about 2.5 million households in mid-August 2024.
• Montana offered one-time income tax rebate checks of up to $2,500 and property tax rebates of up to $675 in 2024.
• New Mexico offered rebate checks of up to $1,000 to eligible residents in summer 2024.

Frequently asked questions