Podcasts Business Retirement Starts Today The American Rescue Plan Act Of 2021, Ep # 184

The American Rescue Plan Act Of 2021, Ep # 184

Published: March 22, 2021, 8 a.m.

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If you have listened to the news at all lately, you probably know what our Retirement Headlines segment will cover. The American Rescue Plan is all any financial news is talking about these days, so in today\\u2019s episode, we\\u2019ll explore what you need to know about this recent piece of legislation.\\xa0

Then in the Listener Questions segment, I answer the question: should having a pension change the way we invest the rest of our portfolio? Press play to find out.\\xa0

Outline of This Episode

  • [1:22] Eligibility has been expanded in this new round of stimulus checks
  • [5:36] What does this mean for you?
  • [9:22] What wasn\\u2019t included in the American Rescue Plan?
  • [12:10] How to invest if you are in line to receive a pension?

Eligibility for stimulus checks has changed

The American Rescue Plan is all over the news lately, but the article that I am referencing is written by Jeffrey Levine from Kitces.com titled\\xa0The American Rescue Plan Act Of 2021: Tax Credits, Stimulus Checks, And More That Advisors Need To Know!\\xa0

The most talked-about part of this tax legislation is, of course, the $1400 stimulus checks which will be soon sent to eligible Americans to provide economic relief from the ongoing pandemic.

Not only are the checks more generous, but there are also key eligibility changes from the previous rounds of stimulus checks. Eligibility in this cycle has been expanded from including only children under the age of 17 to include all dependents in the household.

However, just because you got a stimulus check last time does not mean you will receive one this time. The income limitations of this package mean that there is a narrower margin of income eligibility. While the beginning of the phaseout starts at the same level of income, $75,000 for individuals and $150,000 for married couples, it phases out much more quickly. The cap for individuals is $80,000 and couples is $160,000.

What does this mean for you?

If your income is close to that income cap and went down this year then you\\u2019ll want to file your taxes as soon as you can. However, if you are one of the lucky few whose income rose in 2020 compared to 2019 and are near or above the phaseout range then hold off on filing your income taxes until after you receive your stimulus payment.\\xa0

What else is in the stimulus package?

The stimulus checks weren\\u2019t the only thing included in this $1.9 trillion bill. Another significant change included is a significant increase in the child tax credit. This credit has been increased from $2000 to $3000 and $3600 for children under the age of 6.

It is important to note that not everyone with children age 17 and under will qualify to receive the enhanced 2021 child tax credit amount since the phase-out ranges will be at significantly lower income amounts than the standard child tax credit.

Listen in to find out what else was included and what wasn\\u2019t included in the American Rescue Plan and stick around to hear the listener question.

Resources & People Mentioned

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