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The American Rescue Plan Act was one of the first major legislative accomplishments of the Biden administration. The Act was signed into law in March 2021 to provide financial assistance to American families struggling with the ongoing impact of the COVID-19 pandemic.
The American Rescue Plan Act contained many important provisions aimed at providing financial relief for the widespread devastation caused by coronavirus. For many people, the most meaningful help the Act provided was stimulus payments.
Much of the stimulus money the American Rescue Plan Act made available has already been paid. But that's not the case for all of it. And while the Act is nearly one year old, it could still affect stimulus money in 2022.
How the American Rescue Plan Act can impact 2022 stimulus payments
The American Rescue Plan Act will have an ongoing impact on COVID-19 financial relief for a few key reasons.
Some people are still owed money under the American Rescue Plan Act
Although many individuals and families have already received all of the funds the American Rescue Plan Act provided, this is not true in all situations -- and millions are owed more money.
See, the American Rescue Plan Act provided:
- A $1,400 stimulus payment for eligible adults and dependents.
- A fully-refundable boosted Child Tax Credit of up to $3,600 for eligible children under 6 years old and $3,000 for eligible older children. This is up from a $2,000 credit previously available, only $1,400 of which was refundable.
Not everyone received the $1,400 stimulus checks, though.
People who didn't file recent tax returns and who didn't provide the IRS with their financial details may have missed out on getting any payments. Those whose income was too high to qualify for stimulus checks in 2020 but whose income fell below the eligible threshold in 2021 may also have missed payments. These individuals can claim their stimulus money from the American Rescue Plan Act when filing their 2021 tax returns.
Parents who were entitled to the boosted Child Tax Credit typically also didn't get all the payments yet. The American Rescue Plan Act authorized the advanced payment of these tax credits at a rate of $250 or $300 per month from July to December. This resulted in just half the credit being paid out. Parents are owed the other half and can claim it when filing 2021 taxes.
Finally, anyone who added a dependent in 2021 may have been entitled to both the $1,400 stimulus payment for that dependent and for the boosted Child Tax Credit. As a result, these individuals could be owed up to $5,000 per dependent they added last year when factoring in both the $1,400 payment and the $3,600 credit for children under 6 years old.
Some states are using COVID relief money to make stimulus payments
There's also another possible way the American Rescue Plan Act could affect stimulus money in 2022.
The Act provided funding for states to help those who were struggling. Some states have used the federal funds to provide stimulus relief to eligible local residents. It's possible more will do this in 2022 if they have funds left over.
Ultimately, not everyone will get more stimulus money this year because of the American Rescue Plan Act. But a substantial number of Americans will. You should explore both the federal and state rules surrounding stimulus checks to see if you are one of the millions who can expect more money to go into your bank account in 2022.
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