$1400 or $2000 Stimulus checks are the best for the low income and fixed income beneficiaries of Social Security, including retirement, disability, SSDI survivors, SSI, BA and RRB. I have all the details and what you need to know right here in the topic. All right, with everything going on right now, all of us continue to wonder, is Congress finally going to do something in the form of another stimulus check?
Whether it happens to be a lump sum check or some kind of monthly payments or any combination of them, well, that is still to be determined. But in this topic, I want to talk about why stimulus checks, either in the amount of one $1400, $2,000, or any other dollar amount, is by far the best solution to get money into the pockets of the people, and especially for those people who are low income and or fixed income beneficiaries of all those benefits I mentioned at the beginning of the topic. So let’s get into it and discuss why stimulus checks are so incredibly important and by far the best way to get money into the pockets of the people very, very fast.
As I am you’re one and only daily advocate and I am very much dedicated to you and this community to continue doing all the research, breaking it all down into these short topics, which I deliver a couple of times throughout the day so you can stay updated with what is actually going on right now during this very busy time. And as we continue to get all these changes and announcements out of the President, the Administration, Congress, lawmakers, and with all these new bills, packages, proposals, money, benefits, checks, and everything else going on right now, there’s a lot of changes. And I want to be here for you in any way that I possibly can be by keeping you updated and pointing out anything that you can possibly get your hands on right now, as money is very tight for the vast majority of people
All right, thanks again. Let’s jump into it and discuss all the details and why stimulus checks are so incredibly important. In fact, we could almost call them the almighty stimulus check. Here’s why, obviously So over the last couple of years here, we all received those three checks, right? So the $1200 back in early 2020, the $600 in late 2020, and the $1,500 in early 2021. Here’s the difference between all these. Now, the thing is, as well, I want to point this out because I do know that a lot of you here in the community are fixed income beneficiaries, right? Well, check this out.
Let me ask you a quick question. Anytime that you get a raise to your benefit, whether it’s the annual cost of living adjustment or anything else like this, what happens? Yeah, we all know the answer, right? Well, number one, let’s see. First off, Medicare usually takes away just about any kind of raise that you get to your benefit.
And number two, if you’re somebody who receives Snap benefits, otherwise known as food stamps, what happens there? Oh, yeah, you get a little raise on your benefit and what do they do? They reduce your benefit for Snap benefits pretty significantly, right. However, we all recognize this, right? I think all of us are probably thinking, yeah, I know exactly what happens.
It’s not fun. Yeah, I totally agree with you. It’s a tough situation when you go and you get a little raise and then they take a bunch away from another way. It doesn’t really make a whole lot of sense, does it? Well, let me ask you this much.
How much were your benefits reduced when you received a stimulus check? I’m going to go ahead and answer that for you. It wasn’t reduced at all. You should not have received any kind of reduction to your benefits, whether it was your benefit or your Snap benefits or anything else like this. You should not have received any kind of reduction to your benefit in the event when you got your stimulus checks, it should not have happened.
Now, this is one of the cool reasons why stimulus checks are so incredibly important versus an actual raise to monthly benefits. So let me run through some reasons why stimulus checks are so incredibly important and why in the event that Congress wants to get more money into the people in the pockets of the people, they should be implementing through these stimulus check ideas. And the stimulus check actually ways of getting this money out because this is by far the best way to do it. So here’s what it comes down to. Number one, stimulus checks are very fast to get out to the people, right?
If they just wanted to do so, they could distribute these checks out into the bank accounts of people practically immediately. They could do it within 24 to 48 hours, just like we witnessed with stimulus check number two, the $600 in late 2020, that check was hitting bank accounts already 48 hours and 24 hours right after it was signed into law. So we can see in some instances those checks can hit bank accounts very fast. For the most part, they have the information, the banking information between the Social Security Administration and of course, the IRS between these couple of agencies. Here.
They virtually have the banking information for almost every single person in the United States. So, I mean, it’s super fast, right? They have the ability, they have the technology, they have the power to do all of this, and they can get money into the pockets of the people very, very fast, almost instantaneously. Which, by the way, I can talk about this in a separate topic, but they’re talking about creating something right now called CBDC, otherwise known as Central Bank digital currency or Fed Coin, which is basically a digital currency, which would make it immediate, like even faster than what we’re currently dealing with the current stimulus checks. This would make it instant.
They could put money into your bank account, like boom, snap your fingers and it’s in your bank account. That’s how fast it could be with CBDC. So anyway, I can talk about that in a separate topic. But here’s what’s interesting about stimulus checks. We do know that they could be distributed very fast into the bank accounts of the people that need them very quickly.
So that’s reason number one. That it’s a really cool way to get this done is it can all be electronic and it can be in your possession very fast. Next, I want to point out a couple of other key factors that is cool about stimulus checks and why they are the best way to get money into the pockets of people versus some of the other ways that they get money out of the pockets of fixed income beneficiaries, but then at the end of the day, ultimately just resorts in more reductions to your other benefits. So here’s why. When you get stimulus checks, number one, it’s not taxable.
Number two, it is not counted as resources or income. And number three, it does not offset your other benefits. Yes, you heard all that correctly. That is all accurate. That’s the same thing that you experienced over the last three checks that you received in the last couple of years here, from 2020 to early 2021.
During that roughly one year period of time when we got those three checks, that’s all that happened. When you get the checks, it is not taxable because it is in advance on a refundable tax credit. In other words, if you were to go and file a tax return, this is what would happen. Basically, if you were to go file a tax return for 2021, for example, on there on the 1040, you could see something called the recovery rebate credit. That’s just a really fancy way of saying a one $400 stimulus check.
That is what that is. So in the event that you got your stimulus check in 2021, well then obviously you can’t claim the recovery rebate credit on a tax return. And again, I’m just giving you this as an example. By the way, this is not tax advice in any way, shape or form. I don’t know your situation so I can’t give you tax advice, but this is one way that you could do it.
But rather than making people wait until 2022 to actually claim their recovery rebate credits, otherwise known as stimulus check on their 2021 tax return that was filed in early 2022, they said, we’re going to send it to you in advance. We’re going to advance you the cash, a cash advance. Just like when you go to an ATM machine, you slide your card in and you want a cash advance, right? So maybe you have a credit line of, say, $5,000 on a credit card, and they give you $1,000 of ability to withdraw with a cash advance. It’s the exact same thing.
The IRS gave you a cash advance on a refundable tax credit that you were going to get on your tax return anyway. Rather than waiting until next year or 2022 this year to get it. They actually said, we’re going to give you an advance on that cash and we’re going to give it to you right away. That’s exactly what they did with these last couple of stimulus checks. So the reason for that is it’s not taxable because it’s a refundable tax credit that’s going to show up on your tax return anyway.
So the best of all the worlds, you get the money, but you don’t pay taxes on it. Why? Because it’s a refundable tax credit. It’s a credit that they’re giving you on your tax return in the event that you are going to be filing where you could just take that credit anyway to offset your income and or liability that you would have owed the IRS. Kind of makes sense now we’re getting deep on tax stuff.
Not really, but I’m just saying it’s actually not deep at all. It’s super basic stuff. But the fact of the matter is I won’t go into any more detail on that simply because it doesn’t really matter all the details behind the tax return and stuff like that. But I’m just kind of explaining that situation well, as a result of that, because of it being a refundable tax credit, that also means that it does not offset your other income because it’s not income. Right.
It does not offset your other benefits because it’s not income. Kind of makes sense here. It’s confusing. I know the money comes into you, but yet it’s not counted as all of that stuff because it’s that tax credit. But they’re just advancing it to you right away is what they did in early 2021 when we got all those checks, because they didn’t want everybody to wait until 2022 to get the money, but rather they wanted everybody to get it right away and that’s why they advanced it to us, right? Well, since it’s not counted as income, it doesn’t offset other resources or other benefits, then.
Therefore it would also not offset maybe other assistance that you’re getting, like utility assistance, rental assistance, housing assistance, food assistance, Snap benefits, all of these other things. None of these are going to be offset as a result of stimulus checks. Can you kind of see here the power behind stimulus checks versus the annual cost of living adjustment. Don’t get me wrong, the annual cost of living adjustments for fixed income benefits like Social Security, SSDI, retirement survivors, SSI and VA benefits is also very important. But at the end of the day, when you get your annual cost of living adjustment, what happens first?
Well, you probably start dreading the letter you’re going to receive in the mail from about your Snap benefits saying that, oh, hey, we’re going to reduce your benefit by say, 10% or $25 or whatever it happens to be because now your income has gone up, therefore we’re going to reduce your benefit. Or how about the Medicare for B premium increase every time the annual cost of living adjustment comes out and the Medicare Part B premium takes away almost all of it? What about that, right? We all know that these things happen. Well then what about all the other assistance as well?
Maybe that you’re right on the cusp of where your income could be for assistance, for utility assistance or rental assistance or the free Internet program or all these other programs out there, and now your income is bumped up just enough because of the annual cost of living adjustment that now you’re no longer eligible. That’s not good either. Well, how about this as well? Let’s just say that your income is bumped up just enough over the threshold where now you owe taxes on your actual income because you’re bumped up just over the threshold where now your fixed income benefits are taxable again. Can you see all the differences here?
There’s a big difference between non taxable income in the form of a stimulus check that is not taxable. It’s not counted as income and it will not offset other resources. Meanwhile, a cost of living adjustment is good. But at the end of the day, there’s a lot of embedded consequences with getting that money as well, because it reduces so many other benefits out there right now that fixed income and the low income are actually getting. Makes sense.
Yeah. So you can see here, stimulus checks are powerful. That’s why I said earlier, the almighty stimulus check, because realistically, that’s what it really comes down to. It is the best of all the worlds. It is straight up $1,400, no questions about it.
That’s what it is. No reductions anywhere else, just plain old money that you don’t have to worry about anything else being reduced as a result of getting that money in your pocket. So you can see here, stimulus checks are very important and of course, they can get these things out as quickly as they ever so wanted to do so if they wanted to get them out today. Well, maybe not today specifically. I mean, give them 24 hours.
I mean, seriously, if they wanted to do it in 24 to 48 hours, by all means they could do it if they just wanted to do so. Anyway, I want to leave this out for you because I don’t think a lot of us understand sometimes how important these checks really are. They’re very important and ultimately the best ways to get money into the pockets of the people. Anyway, kind of a little interesting kind of side note on stimulus checks and why they are the preferred method to get money into the pockets of the people, versus some of these other methods that are out there right now which are still good. But at the end of the day, there’s a lot of other things that are not so good about it.