The federal government’s American Rescue Plan authorized the third round of Economic Impact Payments (EIPs), better known as stimulus payments, to be issued. By early June, $42 billion was already paid to eligible individuals. There are many people still waiting though. The IRS has cited several reasons for the delay in payments to members of certain groups of recipients.

Those waiting for payments include many Social Security Disability beneficiaries. As experienced Social Security attorneys, we know many SSD recipients don’t regularly file tax returns because their income was below the minimum threshold requiring a return to be filed. Generally, individuals under age 65 whose income is less than $12,000, or couples whose income is less than $24,000, are not required to file a tax return.

Delayed Inter-agency Exchange of Information

Because almost 30 million Americans receive Social Security Disability benefits, the IRS needs to rely on the Social Security Administration to forward the necessary information for SSD recipients to be added to the list for stimulus checks or direct payments to be deposited in your account If you didn’t file a tax return because your income was not high enough to require a filing, the IRS has no immediate record from which to add you to the roll of payees. The SSA’s delay in turning over the information resulted in delayed payments to many SSD recipients.

The IRS is currently processing the payments to SSD recipients and everyone eligible should be receiving the deposits within a couple of weeks.

Recently Started SSD Benefits

If you started receiving SSD benefits after you filed a 2019 tax return showing your earned income exceeded the maximum income eligible for the third-round stimulus payment, but your 2020 tax return reflects your new diminished amount of income, the IRS may still be calculating your payment. The process is being called an “up-adjustment,” meaning your new return demonstrates that you should have received more stimulus money than was the case given your 2019 income.

More Money Coming for Child Tax Credit for SSD Recipients

There are more payments coming for many American families, including those who receive Social Security Disability benefits.

One of the most important provisions in the American Rescue Plan was the addition of advance payments of child tax credits to families with dependent children. The child tax credit is typically claimed when a parent files their tax return. The credit reduces the amount of tax paid based on how many dependent children live with the taxpayer and how old each child is.

Child tax credits are intended to provide tax relief to lower-income working families with young children in recognition of the added financial burden those families face. If a parent is also receiving Social Security Disability benefits, the economic challenges are that much more substantial.

Under the new plan, instead of waiting to receive the child tax credit at the end of the tax year, monthly payments will be made to eligible families amounting to half the annual credit. The idea is to get the money into the hands of those who need it when they need it. The amount of the tax credit has been raised from $2,000 to $3,600 for children under age 6, and $3,000 for children between ages 6 to 18.

While Social Security Disability payments are taxable, many recipients don’t earn enough to owe income tax, meaning the child tax credit is unavailable anyway. For others, though, earned income can bring their taxable income high enough to take advantage of the child tax credit.

SSD recipients who earn income as part of the Trial Work Period can earn substantially more than needed to claim the child tax credit. So too can SSD recipients whose spouse works regularly and whose filing status is married filing jointly.

Reach Out for Information about Your Expected Payments

If you are waiting for your third-round stimulus payment you can contact the IRS through the Get My Payment website. If you are eligible for the new advance payment of the child tax credit, and you did not file a 2019 or 2020 tax return, make sure the IRS has your information by visiting the new Advance Child Tax Credit Payment 2021 website. If you don’t receive the advance monthly payments, you will still be able to claim the child tax credit when you file your 2021 tax return.

Attorney Daniel Berger and NYDisability.com are Here to Help

The Daniel Berger Law Office and NYDisability.com want to ensure that you get every cent of federal benefits you are entitled to receive. We welcome you to contact our office whenever you have questions about your benefits. If you think you are entitled to receive benefits, but you don’t know how to apply, we are always here to help you. We will fight for you from the beginning of your claim through to its final resolution. Contact us today.