[{"@context":"https:\/\/schema.org\/","@type":"Article","@id":"https:\/\/moneydoneright.com\/fast-money\/free-stuff\/coronavirus-stimulus-checks\/#Article","mainEntityOfPage":"https:\/\/moneydoneright.com\/fast-money\/free-stuff\/coronavirus-stimulus-checks\/","headline":"43% of Americans Will Put Their Stimulus Check Toward Debt, Only 20% Toward Spending","name":"43% of Americans Will Put Their Stimulus Check Toward Debt, Only 20% Toward Spending","description":"Not only is COVID-19 a generation-defining public health crisis, but it has also led...","datePublished":"2020-04-02","dateModified":"2021-09-29","author":{"@type":"Person","@id":"https:\/\/moneydoneright.com\/author\/logan-allec\/#Person","name":"Logan Allec, CPA","url":"https:\/\/moneydoneright.com\/author\/logan-allec\/","identifier":4,"image":{"@type":"ImageObject","@id":"https:\/\/secure.gravatar.com\/avatar\/6e74dd0453a5871d1dcfde6d40d9494765ca8bfdb01927cefee4564d4bee9075?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/6e74dd0453a5871d1dcfde6d40d9494765ca8bfdb01927cefee4564d4bee9075?s=96&d=mm&r=g","height":96,"width":96}},"publisher":{"@type":"Organization","name":"Money Done Right","logo":{"@type":"ImageObject","@id":"https:\/\/moneydoneright.com\/wp-content\/uploads\/Money-Done-Right-Personal-Finance-and-Investing-Blog.png","url":"https:\/\/moneydoneright.com\/wp-content\/uploads\/Money-Done-Right-Personal-Finance-and-Investing-Blog.png","width":488,"height":60}},"image":{"@type":"ImageObject","@id":"https:\/\/moneydoneright.com\/wp-content\/uploads\/coronavirus-stimulus-checks.jpg","url":"https:\/\/moneydoneright.com\/wp-content\/uploads\/coronavirus-stimulus-checks.jpg","height":460,"width":1900},"url":"https:\/\/moneydoneright.com\/fast-money\/free-stuff\/coronavirus-stimulus-checks\/","video":{"@context":"http:\/\/schema.org\/","@type":"VideoObject","@id":"https:\/\/www.youtube.com\/watch?v=lNX1Ozyx9V8#VideoObject","contentUrl":"https:\/\/www.youtube.com\/watch?v=lNX1Ozyx9V8","name":"STIMULUS UPDATE APRIL 1 (BIG NEWS FOR SOCIAL SECURITY RECIPIENTS)","description":"Well, the IRS changed the rules on the stimulus checks AGAIN!\n\nJust right now, during the evening of April 1,\u00a0the IRS once again updated its stimulus check guidelines for retired individuals who are not required to file a tax return.\n\nJust to back up, last week the CARES Act was signed, approving $1,200 checks for many Americans.\u00a0 Based on explicit language in the bill, everyone thought, OK, if you\u2019re on Social Security, you don\u2019t have to file a tax return because the IRS would make payments based on SSA-1099 information returns that the Social Security Administration already sends to the IRS each year.\u00a0 They already know your numbers.\n\nEarlier this week, however, the IRS, in its infinite wisdom, put out language stating this, word for word: \u201cPeople who typically do not file a tax return will need to file a simple tax return to receive an economic impact payment. Low-income taxpayers, senior citizens, Social Security recipients, some veterans and individuals with disabilities who are otherwise not required to file a tax return will not owe tax.\u201d\n\nThey said that they would soon provide information instructing people in these groups on how to file a 2019 tax return with simple, but necessary, information including their filing status, number of dependents, and direct deposit bank information.\n\nHowever, as of some time in the past hour,  they have now removed that language from their website, and now it reads as follows:\n\nQuestion: I am not typically required to file a tax return. Can I still receive my payment?\n\nYes. The IRS will use the information on the Form SSA-1099 or Form RRB-1099 to generate Economic Impact Payments to recipients of benefits reflected in the Form SSA-1099 or Form RRB-1099 who are not required to file a tax return and did not file a return for 2018 or 2019. This includes senior citizens, Social Security recipients, and railroad retirees who are not otherwise required to file a tax return.\n\nSo as of right now, we have good news: Social Security beneficiaries who are not typically required to file tax returns will not need to file an abbreviated tax return to receive an Economic Impact Payment. Recipients will receive these payments as a direct deposit or by paper check, just as they would normally receive their benefits.\n\nAnd I hope that this stands because it is absolutely pointless to make people who the IRS already knows how much they make file a tax return.","thumbnailUrl":["https:\/\/i.ytimg.com\/vi\/lNX1Ozyx9V8\/default.jpg","https:\/\/i.ytimg.com\/vi\/lNX1Ozyx9V8\/mqdefault.jpg","https:\/\/i.ytimg.com\/vi\/lNX1Ozyx9V8\/hqdefault.jpg","https:\/\/i.ytimg.com\/vi\/lNX1Ozyx9V8\/sddefault.jpg","https:\/\/i.ytimg.com\/vi\/lNX1Ozyx9V8\/maxresdefault.jpg"],"uploadDate":"2020-04-02T02:33:26+00:00","duration":"PT3M9S","embedUrl":"https:\/\/www.youtube.com\/embed\/lNX1Ozyx9V8","publisher":{"@type":"Organization","@id":"https:\/\/www.youtube.com\/channel\/UCQ9WUXlSuLlbi5BLkgtEUEA#Organization","url":"https:\/\/www.youtube.com\/channel\/UCQ9WUXlSuLlbi5BLkgtEUEA","name":"Logan Allec","description":"Logan Allec is a CPA and the founder of Choice Tax Relief, which specializes in helping people with their IRS and state tax debt.","logo":{"url":"https:\/\/yt3.ggpht.com\/43_VKqrbO06RGMcxfdQbDXosrkVRq1yf5QgSQEiR4ILUGWV9fJtTh0o2ftYMYqVo6PwnEOPRdg=s800-c-k-c0x00ffffff-no-rj","width":800,"height":800,"@type":"ImageObject","@id":"https:\/\/www.youtube.com\/watch?v=lNX1Ozyx9V8#VideoObject_publisher_logo_ImageObject"}},"potentialAction":{"@type":"SeekToAction","@id":"https:\/\/www.youtube.com\/watch?v=lNX1Ozyx9V8#VideoObject_potentialAction","target":"https:\/\/www.youtube.com\/watch?v=lNX1Ozyx9V8&t={seek_to_second_number}","startOffset-input":"required name=seek_to_second_number"},"interactionStatistic":[[{"@type":"InteractionCounter","@id":"https:\/\/www.youtube.com\/watch?v=lNX1Ozyx9V8#VideoObject_interactionStatistic_WatchAction","interactionType":{"@type":"WatchAction"},"userInteractionCount":104905}],{"@type":"InteractionCounter","@id":"https:\/\/www.youtube.com\/watch?v=lNX1Ozyx9V8#VideoObject_interactionStatistic_LikeAction","interactionType":{"@type":"LikeAction"},"userInteractionCount":2166}]},"about":["Free Stuff"],"wordCount":3373,"keywords":["hide on posts list","youtube","podcast","schema"],"articleBody":"Not only is COVID-19 a generation-defining public health crisis, but it has also led to a near shutdown of economies around the world.In an attempt to \u201cflatten the curve\u201d and slow the effects on the healthcare system, many businesses have shuttered, resulting in 3,283,000 Americans filing for their first week of unemployment benefits in the latest report from the Department of Labor.In response to this crisis, last week the president signed into law a bill approving $1,200 stimulus checks for many Americans.In light of this legislation, Money Done Right worked with Google Consumer Surveys to ask over 1,000 Americans if they would use their stimulus check to spend, save, pay off debt, or invest.Key Findings:43% of Americans will put their stimulus check toward debt, and only 20% toward saving. This is contrary to the goal of a stimulus benefit, which is to boost the economy by providing consumers additional money to spend.17% of American men plan on using their stimulus check to invest, compared to 9% of women.47% of American women plan on using their stimulus check to pay off debt, compared to 39% of men.Table of ContentsToggle43% of Americans Will Put Their Stimulus Check Toward DebtGender Differences2020 COVID-19 Stimulus Checks: An Overview6 Things to Do with Your Stimulus CheckCoronavirus Stimulus Check FAQsOther 2020 Coronavirus ResourcesState Resources43% of Americans Will Put Their Stimulus Check Toward Debt\u00a0!function(e,i,n,s){var t=\"InfogramEmbeds\",d=e.getElementsByTagName(\"script\")[0];if(window[t]&&window[t].initialized)window[t].process&&window[t].process();else if(!e.getElementById(n)){var o=e.createElement(\"script\");o.async=1,o.id=n,o.src=\"https:\/\/e.infogram.com\/js\/dist\/embed-loader-min.js\",d.parentNode.insertBefore(o,d)}}(document,0,\"infogram-async\");We found this response interesting given that many creditors — including credit card companies, mortgage companies, and other holders of American consumer debt — are extremely willing to work with their customers during this trying time.Gender DifferencesWhile an approximately equal percentage of men and women plan to spend or save their stimulus checks, the genders are more divided when it comes to investing and paying off debt.Men are twice as likely as women to invest their check, while women are more likely to pay off debt.\u00a0!function(e,i,n,s){var t=\"InfogramEmbeds\",d=e.getElementsByTagName(\"script\")[0];if(window[t]&&window[t].initialized)window[t].process&&window[t].process();else if(!e.getElementById(n)){var o=e.createElement(\"script\");o.async=1,o.id=n,o.src=\"https:\/\/e.infogram.com\/js\/dist\/embed-loader-min.js\",d.parentNode.insertBefore(o,d)}}(document,0,\"infogram-async\");2020 COVID-19 Stimulus Checks: An OverviewThis isn\u2019t the first time stimulus checks have been sent out.In 2001, there was a stimulus in the form of a tax rebate. The tax rebates were part of a 10-year tax cut bill.\u00a0 Households received rebates that were either $300 or $600.There was also the Economic Stimulus Act of 2008, in which economic stimulus money was sent to help avoid recession and boost the economic conditions at the time. Under this stimulus act, taxpayers below a certain individual income limit received at least $300 per person and $600 for married couples filing jointly. The checks couldn\u2019t exceed $600 for a single person or $1200 for a jointly-filing married couple.In 2009 then-President Obama passed the American Recovery and Reinvestment Act. Under this legislation, there were $14.2 billion sent out as a one-time payment. The payments went to recipients of Social Security, veterans, railroad retirees, and Supplement Security Income recipients.But this most recent legislation is the largest emergency aid package in U.S. history.The plan will provide assistance to the tens of millions of households throughout American impacted by coronavirus.The different components of the bill include stimulus payments to individuals, unemployment coverage for individuals, changes in retirement account rules, and alterations to student loans.How Much Are the Stimulus Checks?If you file as single and your adjusted gross income was $75,000 or less on your 2019 tax return you\u2019re eligible for the full $1,200 payment.If you file jointly with your spouse and your adjusted gross income was $150,000 or less on your 2019 tax return, you\u2019ll receive $2,400.Also, if you have children under the age of 17, you will get an additional $500 check per child if you are single and your adjusted gross income is $99,000 or less or you are married filing jointly and your adjusted gross income is $198,000 or less.So just doing some math here, if you’re a married couple with two children under the age of 17 and your adjusted gross income is $150,000 or less per your 2019 tax return, you’d be looking at a $3,400 check.Now what if you made more than $75,000 and you file single or more than $150,000 and you file married filing jointly.\u00a0 Well, your stimulus check will be reduced by five cents on the dollar\u00a0 in adjusted gross income over those threshold amounts.So if you’re single and make $80,000, that’s $5,000 over the threshold.\u00a0 $5,000 times five cents is a $250 reduction, and $1,200 less $250 is $950, so your check would be for $950.What If You Haven’t Filed Your 2019 Tax Return?They’ll look at your 2018 tax return.But what if your 2018 income was over the threshold, so you wouldn’t be eligible for a check based on your 2018 income, but let’s say your income was less in 2019, but you haven’t filed your tax return?\u00a0 What happens then?In this situation, our understanding is that you wouldn’t get a check now, but you would be receive a credit equal to the stimulus check you would have received had you filed your 2019 tax return.The same is true if your income dropped in 2020; you wouldn’t get a stimulus check now, but you will get a tax credit for the amount you’re entitled to when you file your 2020 tax return next year.What If I’m on Social Security and Don’t File a Tax Return?The IRS went back and forth on this, but as of right now, if you’re on Social Security and aren’t required to file a tax return, you are still eligible if you got a Form SSA-1099 for the year.What If I’m a Dependent?Also, if you can be claimed as a dependent on someone else’s tax return, you are not eligible for a stimulus check.What If I’m Not a U.S. Citizen?If you aren\u2019t an American citizen, but you live and work in the U.S. with a valid Social Security number, you also qualify.However, you don\u2019t qualify if you are a visitor or are in the U.S. illegally.How to Get a Coronavirus Stimulus Check (What You Need to Do)If in the past two years, you\u2019ve received your tax return by direct deposit, your money will be sent to that account, and Treasury Secretary Steve Mnuchin has said that payments could be sent in as early as three weeks.Will that happen?I don’t know, but don’t hold your breath.And what if your bank account has changed?Well, the IRS has stated that they are working on a portal where you can update your bank account information.6 Things to Do with Your Stimulus CheckThere are different options you have available to you as far as how you spend or save your stimulus check. In some ways, the government usually encourages the idea of spending the money because that\u2019s how it can ultimately stimulate the economy, but what you do is up to you.The BasicsIf you\u2019ve already lost your job or you have a business that\u2019s been very impacted, you will probably need to use your check on the basics such as food, housing costs, utilities, and gas.Be aware that many banks and lenders are being flexible with people right now and putting a hold on their monthly payments.Emergency SavingsYour stimulus check can go into emergency savings, which can be comforting the level of uncertainty going on right now. An emergency savings account doesn\u2019t necessarily mean that you put cash under your mattress.Instead, you might want to put it into a liquid savings account that earns a bit of interest. Liquid means it\u2019s a way to access your money quickly and without penalties, if you need to.Interest rates are low right now, so it\u2019s not ideal, but a money market account, a CD or a high-yield savings account does give you liquidity if you need to access your money quickly and you earn a bit more than you would with your money sitting in a checking account which earns little to no interest.Pay Off Costly DebtIf you have high-interest debt, like credit card debt, and you\u2019re not in a situation where you need emergency cash right away, consider paying some of it down.If you pay some of your debt off, or even better all of it, it can help you cut out a monthly expense later on.Add to Your Retirement FundIf you have a traditional IRA or Roth account, you can still contribute to your account, and the upside in addition to the savings component is the fact you can then use your contribution to reduce your tax liability for 2019.The IRS extended the tax filing deadline to July 15, and with that came an extension on the deadline to contribute to your traditional or Roth IRA.Invest in the Stock MarketThe stock market has undoubtedly been on a roller coaster in recent weeks, but if you have the stomach for that, you can put your stimulus check into the market. You can still find good deals, although most analysts aren\u2019t sure when the market will fully reach its bottom, so this is risky.Make a DonationIf you can afford to, consider donating your stimulus check or some of it. Many charitable organizations and food banks are seeing a rise in demand.Coronavirus Stimulus Check FAQsThe following are answers to some of the most common questions you might ask about coronavirus stimulus checks.Do I qualify for a stimulus check?If you are a U.S. resident and you have a valid Social Security number, and meet income requirements, you qualify for a coronavirus stimulus check. If your income comes completely from means-tested programs and is nontaxable, as is the case with Supplement Security Income as a result, then you are also eligible.If you are a dependent on another person\u2019s tax return, you don\u2019t get a payment, however dependent children under the age of 16 qualify for an additional $500.Also, if you’re behind on child support, you are likely ineligible for a stimulus check.When will I get my stimulus check?According to Treasury Secretary Steve Mnuchin, people could begin receiving direct payments from the IRS within three weeks. For people without direct deposit, it can take weeks or months for checks to be sent out.Where will I receive my check?If you don\u2019t receive a direct deposit, you will receive a check to the last known address the IRS has for you.What if I moved since I filed my return?If you\u2019ve moved since you last filed your taxes, you might need to contact the IRS and tell them your new address. You can use a Change of Address Form, send your new address when you file or send a written statement. You can also call the IRS and tell them.Will there be more stimulus checks?Currently, the plan is to send out a one-time payment, but lawmakers and the Treasury Secretary have said they may need to revisit that in the future.Are the stimulus checks taxed?While it\u2019s not entirely certain right now, the indications are that the money isn\u2019t taxable.What is adjusted gross income?The income the government is using for their payment calculations is based on your adjusted gross income. Adjusted gross income is your wages, dividends, capital gains, and other income minus student loan interest, 401(k) payments and other deductions.How do I tell the IRS my direct deposit information if it wasn’t on my tax return?OK, so the IRS has said that in the coming weeks they are developing a web-based portal where you can provide your banking information to the IRS so that you can receive your payments “immediately” — yes, they use the word “immediately” as opposed to checks in the mail.I would highly recommend that you do this, especially if you need this stimulus money pronto.\u00a0 Direct deposit will come so much faster than a paper check, it’s just like your tax refunds, direct deposit comes faster.What do I do if I didn’t have to file a 2018 or 2019 tax return?The answer is yes.\u00a0 This is different than what we thought last week because the IRS said, “Most people don’t have to do anything.”\u00a0 But in their new guidance, they say, “People who typically do not file a tax return will need to file a simple tax return to receive an economic impact payment.”This won’t be a full-blown tax return, but it will indicate things like their filing status, number of dependents, and of course their direct deposit bank account information.How do you file this “simple tax return”?The IRS doesn’t know yet.\u00a0 They haven’t put it together yet, but the minute it comes out, I will let you all know, and I will walk you through it right here on the channel, so be sure to subscribe so you get that notification.What if I should have filed a 2018 or 2019 tax return but I just didn’t?Do it ASAP.\u00a0 It’s not clear if that simple tax return that I just talked about — which is for people who didn’t have a filing obligation — will cover you.\u00a0 So you want to file ASAP.How long are these economic impact payments available?The IRS said these payments are available throughout the rest of 2020.Other 2020 Coronavirus ResourcesThe following are some of the other elements that are part of coronavirus legislation.Families First Coronavirus Response Act (FFCRA)Under the Families First Coronavirus Response Act, there are outlines for employer-paid leave requirements. Details of what employers have to provide employees include:Up to two weeks or 80 hours of paid sick leave at the regular rate of pay if the employee isn\u2019t able to work because of being quarantined or is experiencing COVID-19 symptomsTwo weeks or up to 80 hours of paid sick leave at a rate of two-thirds of the normal rate of pay if the employee can\u2019t work because of the need to care for someone subject to quarantine or to care for a child under the age of 19 whose child care provider or school is closed or not availableIf an employee has been employed for at least 30 days, their employer also has to provide up to 10 weeks of paid expanded family and medical leave at a pay rate of two-thirds of the employee\u2019s regular rate if they can\u2019t work because their child\u2019s school is closed or because of reasons related to COVID-19It\u2019s important to note with this that these things don\u2019t automatically apply across the board. For example, the paid sick leave and expanded family leave apply to public employers and private employers with fewer than 500 employees.Small businesses with fewer than 50 employees may qualify for an exemption.Student Loan ReliefFederal student loan borrowers won\u2019t be penalized for making any late payments through September 30, under the coronavirus legislation.If a federal student loan qualifies, there is an automatic zero-interest deferment option.Private student loan borrowers don\u2019t get relief from the bill. Only those borrowers with public-backed loans qualify.Unemployment InsuranceThere are expansions of unemployment insurance. When you\u2019re on unemployment insurance in your state, you are eligible for an extra $600 a week in federal emergency compensation. That additional $600 a week is added to what you get in state benefits.You also receive the $600 if you were receiving unemployment benefits before the COVID-19 outbreak.If you work from home and you\u2019re employed, you\u2019re not eligible.There is also a new program called Pandemic Unemployment Insurance. This offers benefits to freelancers, contractors, people who are self-employed, and gig workers who wouldn\u2019t otherwise be able to qualify for emergency compensation.Retirement AccountsFor the calendar year 2020, under the legislation, no one has to take a required minimum distribution from their workplace retirement savings plan or their retirement account. An example of this type of account is a 401(K).The reason this was included in the bill is that it helps people avoid being forced to sell their investments that have gone down in value, so they don\u2019t have to take a loss right now.If you need to take money out of your retirement account, you can withdraw up to $100,000 without the usual 10% penalty if you\u2019re taking it out because of the pandemic outbreak.You can also borrow twice the usual amount from your workplace retirement plan or 401(k).Contributions to CharityThere is a new charitable deduction available under the bill for up to $300 annually in contributions. It\u2019s available if you don\u2019t itemize deductions.Protection for RentersIn the bill, there is a national, temporary moratorium on evictions for renters whose landlords have mortgages that are either owned or backed by federal entities like Fannie Mae or Freddie Mac. This lasts for 120 days after the passage of the bill, and it also says landlords in these situations can\u2019t charge penalties or fees for not paying your rent.Small BusinessesBecause of COVID-19, the federal government is putting in place expanded options for small businesses to access funding. For example, small business owners in all states and territories can apply for a low-interest loan due to COVID-19.The SBA is going to be working with state governors to provide targeted loans to eligible small businesses severely impacted by COVID-19.The Express Bridge Loan Pilot Program will offer help to small businesses that currently have an SBA Express Lender relationship. They may be eligible for up to $25,000 and they are loans meant to bridge the gap while applying for an SBA Economic Injury Disaster Loan.State ResourcesStates are setting up their own plans to help residents impacted by COVID-19, in addition to the federal measures.CaliforniaCalifornia is suspending the 60-day notice requirement for employers to give written notice to employees if they\u2019re closing their business.If your business is directly affected by COVID-19, you can request an extension up to 60 days to file state payroll reports without penalty or interest.If you can\u2019t work because you are exposed to COVID-19, and a medical professional certifies it, you can file a Disability Insurance Claim. Disability Insurance in California offers short-term payments to eligible workers who have a partial or full loss of wages.\u00a0If you can\u2019t work because you\u2019re caring for a family member who is sick or quarantined, you can file a Paid Family Leave claim. Paid Family Leave provides up to six weeks of benefit payments to workers who have a full or partial wage loss.If your child\u2019s school is closed requiring you to miss work to care for them, you might be eligible for Unemployment Insurance benefits, and you may also be eligible if you have reduced work hours.New YorkAll New York City students can get three free meals a day from the NY Department of EducationNYC Department of Education for the Aging is providing delivered meals to eligible seniors and people with disabilities.\u00a0New York State is dropping the 7-day waiting period on Unemployment Insurance benefitsWashingtonWashington has changed requirements to help more people in the state get access to unemployment, and the one-week waiting period for benefit eligibility is being waived.There are programs being made available to employers to help them keep their employees. For example, there is something called SharedWork. Under this program, employers can reduce their employees\u2019 hours by as much as 50%, and employees can get partial unemployment benefits.Under the Industrial Insurance Act, workers\u2019 may have expanded ways to apply for workers\u2019 compensation if they were exposed to coronavirus during their job.PennsylvaniaThe Pennsylvania governor announced new funding to help small businesses affected by the COVID-19 outbreak through something called the Pennsylvania Industrial Development Authority\u2019s Small Business First Fund.The required Waiting Week for unemployment claims has been suspended.Work search and work registration requirements are temporarily suspended for all unemployment claimants.As the days and weeks go on, we may learn more about different programs and options available federally and on a state-by-state basis to help people and businesses affected by the COVID-19 pandemic."},{"@context":"https:\/\/schema.org\/","@type":"BreadcrumbList","itemListElement":[{"@type":"ListItem","position":1,"name":"Fast Money","item":"https:\/\/moneydoneright.com\/fast-money\/#breadcrumbitem"},{"@type":"ListItem","position":2,"name":"Free Stuff","item":"https:\/\/moneydoneright.com\/fast-money\/\/free-stuff\/#breadcrumbitem"},{"@type":"ListItem","position":3,"name":"43% of Americans Will Put Their Stimulus Check Toward Debt, Only 20% Toward Spending","item":"https:\/\/moneydoneright.com\/fast-money\/free-stuff\/coronavirus-stimulus-checks\/#breadcrumbitem"}]}]