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Stimulus/Unemployment Update

March 21st, 2021 at 12:06 pm

Final shake out of how the latest stimulus bill benefits us in direct payments and tax savings.

Stimulus (x4):


First $10,200 $20,400? of unemployment will be tax free for 2020:  

Tax savings 2020:  +$2,200

{I edited this part because of some tax loophole in community property states.  We probably get the full $20K and will save an extra $555 I was not anticipating.}

Child Tax Credit changes:

Tax savings 2021: +$1,000

$1,000 tax savings for DL (increased child tax credit)

I decided to just file taxes on time and not play the game with getting extra child credit for MM(17).  The more extra income we have, the less benefit we will get from playing the game.  Will opt for simplicity for over a (big maybe) few dollars.

I will check if our tax software has been updated yet for retroactive tax changes, and might just file our taxes this weekend if we can.  I already did our taxes a while ago, but then they changed 2020 tax laws.  (The work is done, but hadn't filed).

Unemployment extension:


MH just got renewed for another $5,000 of benefits.

Because of this, I think I am just going to bite the bullet and do ROTH IRA contributions for 2020.  I was initially hoping they'd extend IRA due dates and that I would have more time to decide.  But...  lots of college news this week and I think it's safe at this point to voluntarily pay an additional $1,500 in taxes.


Will use $1,500 of this money to fund ROTH IRAs. Basically, swapping Traiditional IRA deductions out for tax-free unemployment.  

Total unexpected monies:  +$12,300

$11,300 of this should be received this year (within the next month or two).

The rest will sort out when we file taxes next year.

A lot of college stuff is shaking out and I will do a separate post for that.  But it sounds like we will most likely use this money to cover college costs this year.  As of today, it looks likely that we will just stick with sidebar goals, and that college won't change anything.  Plan A was always to stick to inexpensive public colleges and to cash flow with current income.  This plan is shaping up pretty well.   


1 Responses to “Stimulus/Unemployment Update”

  1. rob62521 Says:

    Sounds like a good plan to use the money for college. That's great that Plan A seems to be working well.

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