Will College Students Get Stimulus Checks?

Will college students get second stimulus checks?

Here’s what you need to know — and how it can affect you.

$1,200 Second stimulus checks

Senate Majority Leader Mitch McConnell (R-KY), joined by several Senate Republicans, released on the Senate Floor yesterday their proposal for the new stimulus package. As expected, Senate Republicans propose a one-time, $1,200 stimulus check. Under the Republican plan, which is called the Heals Act, the eligibility criteria to receive a second stimulus check, or Economic Impact Payment, is largely the same as the first stimulus check — with one important difference. To recap:

Who is eligible for a second stimulus check? How much is the second stimulus check?

Based on the first stimulus check, the second stimulus would check would look like this:

• $1,200 for each individual;
• $2,400 for married/joint filers;
• $500 for dependents
• If you earned less than $75,000 (individuals) or $150,000 (married/joint filers), you would receive a $1,200 second stimulus check.
• The second stimulus check would be reduced by $5 for every $100 of adjusted gross income above those income limits until $99,000 of adjusted gross income for individuals and $198,000 for married/joint filers.

Will college students get stimulus checks?

The answer is: it depends. There are two basic ways that college students could qualify for a second stimulus check. The answer depends on whether a college student can be claimed as a dependent on someone else’s federal tax return, such as a parent, for example. Let’s examine two basic examples:

A college student earns income and can’t be claimed as a dependent

For example, if a college student earned income in 2019 and filed a federal tax return, that college student may qualify for a stimulus check. Of course, the college student could not be claimed as a dependent on anyone else’s tax return. The college student also would need to meet the other requirements under the proposed legislation. For example, a college student could receive up to $1,200 if the college student meets the income requirements.

A college student can be claimed as a dependent

For example, if a college student can be claimed as a dependent on someone else’s federal tax return, then the college student would not be eligible for a second stimulus check. That said, the person who claims the college student as a dependent could receive a dependent payment for that college student. Why? For the first stimulus check, the Cares Act — the $2.2 trillion stimulus package that Congress passed in March — permitted up to $500 for a dependent payment for dependents younger than age 17. In contrast, the Heals Act has no age limit, which means that dependent college students would qualify for a dependent payment under this proposal. Of course, this person claiming a college student as a dependent would need to meet the requirements of the proposed legislation to receive the dependent stimulus payment.

Will high school students receive a stimulus check?

High school students also may qualify for dependent stimulus payments. The Cares Act did not provide dependent stimulus payments for high school students who were age 17 or 18, for example. However, under the Heals Act, like college students, high school students who are dependents claimed on a federal tax return can qualify.

Final Thoughts

College students have been particularly impacted by Covid-19. Many have significant student loan debt, so it’s important to understand what the stimulus package means for your student loans. College classes at many colleges and universities have been shifted online, while college campuses have closed temporarily due to Covid-19. So, for many college students, it’s important to understand whether they can get a stimulus check. The good news for those hoping for second stimulus checks is that Republicans and Democrats largely agree — through their respective proposed legislation, the Heroes Act and the Heals Act, that there should be a second stimulus check and that a second stimulus check should be up to $1,200. However, Democrats wants second stimulus check payments of $1,200 for each dependent, whereas Republicans want $500 per dependent. Some Democrats also want $2,000 a month second stimulus checks, which Senators Kamala Harris (D-CA), Edward Markey (D-MA) and Bernie Sanders (I-VT) proposed in Senate legislation. However, Democrats likely will compromise on a one-time stimulus check, rather than monthly stimulus checks.

With all the excitement surrounding a second stimulus check, it’s important to remember that the Heals Act is a proposal and not legislation. This means a second stimulus check has not been approved and may not be approved. There is also no guarantee that there will not be an age cap for dependent payments in the final stimulus bill. There is also no guarantee that Congress will pass a final stimulus bill. There is certainly an expectation that Congress will pass a fifth stimulus bill, but proposals and dollar amounts can change.

Source: forbes.com