Family Matters: Affording Care for a Family Member

Twenty-three year-old Emilie Lima Burke has started to save $20 per day.

It’s not for a vacation or her retirement fund. Instead, she’s preparing for the moment she expects she’ll need to take care of her aging dad and all his expenses.  Burke, who runs the site, a financial, health and career resource for millennial women, says that her parents used to joke that she and her sister would be “their retirement plans.”

But that’s seems no longer a laughing matter.

“My dad has struggled with long bouts of unemployment…He has no money saved at all,” says the 23 year-old. “I know that at some point I will be [his caregiver]. When there is no retirement fund or any assets for aging parents to fall on, you just have to make a plan.”

We’re living longer these days, which means that many of us have the great fortune of growing older with our parents. The number of Americans ages 65 and older expected to nearly double by 2050, according to the U.S. Census.

With longevity, though, comes the increasing responsibility and financial pressure to care after our aging family members, especially, if like Burke, our family doesn’t have a financial plan already in place. The average working household has “virtually no retirement savings.”

It’s no surprise then that about one in four Americans (with parents ages 65 and older) is helping a parent with his or her affairs, offering financial help or caring after them.

And not to cause alarm, but more than half of the country – 29 states – have so-called “filial support” or “filial responsibility” laws that could potentially require adult children to pay for their parents’ care if they don’t have the means to do so for themselves.

If you’re struggling to support a family member or anticipate needing to care after a loved one down the road, here are some ways to help make your efforts more affordable.

Know Their Bottom Line

If a family member is turning to you for help, particularly financial help, then it’s more than appropriate to have a candid money talk – no matter how uncomfortable it may be.  Ask to see how much they have in the bank, as well as what other streams of income they may be receiving (e.g. social security, a pension, insurance payout, a portfolio distribution, etc.). Create a budget to pay for as much as possible with your parent’s income and assets before tapping your own bank account.

“I see people who take on credit card debt or stop paying their own bills to care for their parents, but a much better option is to first exhaust all of the resources that the parents can have access to,” says Belinda Rosenblum, a financial strategist at

Having a paper trail of statements showing income and expenses will also prove helpful if your parent needs to apply for Medicaid, the health insurance program designed to help those with little money. Here’s where you can learn more about Medicaid eligibility.  Care facilities sometimes have a Medicaid expert on staff to assist with your application, too.

Reach Out to Local and National Resources

When business coach Amanda Abella’s grandmother was diagnosed with Alzheimer’s a year ago, her family needed to find a way to pay for her extra care. The adult day care alone, she estimates, would have cost $100 per day.

For guidance, they turned to her grandmother’s doctor and the social worker at the hospital and discovered the Alliance for Aging, a Florida-based private, not-for-profit that provides a range of services to older people, including personal care, legal help, transportation, meals, etc. After several rounds of interviews and almost a year of being on the wait list, Abella’s grandmother succeeded and now receives free nursing care.

The lesson: Never assume that you have to go it alone. Help is out there. Local and national resources offer grants and support to seniors. To start your search for funding visit: Family Caregiver Alliance and Paying For Senior Care.

Also worth mentioning: If your aging parents are veterans look into the Department of Veterans. “Often veterans overlook or are not aware of the benefits they are eligible for such as medical care or prescriptions, especially if they’ve been separated from the military for a long time,” says military money life coach Lacey Langford.

Look Into The Family and Medical Leave Act (FMLA)

If you need to take time off work to care for a family member, be it a parent, child or even yourself, but worried about losing your job in the process, you may benefit from the Family and Medical Leave Act (FMLA).

The federal law grants certain workers up to 12 weeks of unpaid leave per year with the promise of getting their jobs back. You can also keep your company health benefits during your time off. Some states such as California, New Jersey and Rhode Island allow qualified workers to earn at least part of their paycheck during this time.

Remember the Tax Deduction

Track expenses and if you afforded more than half of your parent’s needs during the tax year (including utilities, medical bills, food and general living expenses) and he or she earned less than $4,050 (not counting social security), then you may be able to claim mom or dad (or both) as a dependent on your 2016 tax return. Doing so offers you additional tax benefits. You can find more information on how to claim a parent as a dependent on

Keep in mind that whether or not your parent qualifies as a dependent, you might be able to deduct the medical expenses (including prescriptions and doctor visits) you paid for on his or her behalf from your taxable income. The IRS requires the total of these expenses to be more than 10% of your adjusted gross income in order to claim the deduction.

Consider Long-Term Care Insurance

If your parents have yet to reach the age where they may need some assistance, see if they’ve looked into long-term care insurance. This can come in handy if they think you may need to afford a nursing home or at-home care later down the road. (And about 70% of Americans who reach age 65 will likely need some time of long-term care before as they age). Medicare does not cover these costs and they can be very expensive.

For example, the average cost of a home health aid, which long-term care would cover, can be anywhere from $34,000 to $57,000 a year depending on where you live.  If your parents don’t have enough saved to cover this, it may fall on your shoulders. It’s just as beneficial to you for them to seriously consider long-term care.

You may decide to purchase a policy yourself and have your parent(s) be the beneficiary.

Keep in mind that the ideal time to buy long-term care is when your parents are in their 50’s and 60’s (specifically between 52 and 64). The younger and healthier the beneficiary is, the more likely he or she will qualify (and the lower the monthly premium). For a couple in good health applying for long-term health care in their mid-50s, the average annual cost is about $2,350 (or less than $200 a month).

Create a Family Fund

Finally, like Burke, it pays to start saving early for the financial what-ifs surrounding our family members.

You can hope for the best, but should also prepare for the worst. Tucking away even $10 or $15 a week for the next five or ten years while your parents are still able to take care of themselves could yield an essential nest egg for everybody when life takes a turn.

Have a question for Farnoosh? You can submit your questions via Twitter @Farnoosh, Facebook or email at (please note “Mint Blog” in the subject line).

Farnoosh Torabi is America’s leading personal finance authority hooked on helping Americans live their richest, happiest lives. From her early days reporting for Money Magazine to now hosting a primetime series on CNBC and writing monthly for O, The Oprah Magazine, she’s become our favorite go-to money expert and friend.

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Third Stimulus Check Calculator

President Biden signed the American Rescue Plan Act on March 11. Provisions in the bill authorize another round of $1,400 stimulus checks for each eligible person ($2,800 for couples), plus an additional $1,400 for each dependent. However, as with the first- and second-round payments, the third-round stimulus checks are reduced – or eliminated – for people with an income above a certain amount.

[Stay on Top of Stimulus Check Developments – Sign Up Free for the Kiplinger Today E-Newsletter.]

To see how large your payment should be, answer the three questions in the calculator below and we’ll give you a customized estimate of your third stimulus check amount. (To see how much you should have received for your second stimulus check, see Kiplinger’s Second Stimulus Check Calculator.)

Different Phase-Out Rate

Although the income levels at which third stimulus checks start to be phased out (i.e., reduced) are the same as the amounts used for the first two stimulus payments, the rate at which the phase-out occurs is different. As a result, you might not get a third stimulus check even if you received payments in one or both of the first two rounds.

More Money for Certain Families

One big change with third stimulus checks is that an extra $1,400 is tacked on to your payment for any dependent in the family. For the first- and second-round payments, the additional amount allowed – $500 for first-round payments and $600 in the second round – was only given for dependent children age 16 or younger. As a result, families with older children, including college students age 23 or younger, or with elderly parents living with them, didn’t get the extra money added to their previous stimulus payments. That’s not the case for third-round stimulus checks.

Amount Based on 2019 or 2020 Tax Return

For third-round stimulus payments, eligibility and amounts are based on either your 2019 or 2020 return. If your 2020 tax return isn’t filed and processed by the IRS by the time the tax agency starts processing your third stimulus payment, then the IRS will use information from your 2019 tax return. If your 2020 return is already filed and processed when the IRS is ready to send your payment, then your stimulus check eligibility and amount will be based on the information on your 2020 return. If your 2020 return is filed and/or processed after the IRS sends you a third stimulus check, but before August 16, 2021 (or September 1 if the May 17 filing deadline is pushed back any further), the IRS will send you a supplemental (“plus-up”) payment for the difference between what your payment should have been if based on your 2020 return and the payment actually sent based on your 2019 return. As a result, your third stimulus check may be higher or lower depending on when you file your 2020 tax return.

Learn More About Your Third Stimulus Check

For more information about third-round stimulus checks, see:


Third Stimulus Check Update: Supplemental “Plus-Up” Payments Coming Soon

Did you already get a third stimulus check? If so, would you like the IRS to send you even more money? Well, for some people, that’s exactly what’s going to happen, thanks to a new twist in the recently enacted American Rescue Plan Act that requires the IRS to send a supplemental payment to certain people who already received a third stimulus check. (And we’re not talking about a fourth round of stimulus payments to everyone.) The IRS is calling these extra checks “plus-up” payments, and some lucky Americans could get them as early as next week.

Generally, supplemental payments will go to Americans who received a third stimulus check that was based on information taken from their 2019 federal income tax return or some other source, but who are eligible for a larger payment based on a 2020 return that is filed and/or processed later. This could happen, for example, if you had a new baby last year that is reported as a dependent for the first time on your 2020 return (see below for other possible triggers).

So, if you haven’t already filed your 2020 return, you may have an extra incentive to get it done quickly. Your 2020 return must be filed and processed by the IRS before August 16, 2021 (or September 1 if the May 17 filing deadline is pushed back any further) if you want to get a supplemental payment. That means you still have plenty of time to act – by why wait? The sooner you turn in your return, the sooner you’ll get your “plus-up” payment.

[Stay on top of all the new stimulus bill developments – Sign up for the Kiplinger Today E-Newsletter. It’s FREE!]

How Stimulus Payments Are Calculated

Each eligible American will receive a $1,400 third stimulus check “base amount” ($2,800 for married couples filing a joint tax return). Plus, for each dependent in your family, the IRS will tack on an additional $1,400. Unlike for the previous stimulus payments, the age of the dependent is irrelevant.

However, third-round stimulus checks will then be “phased out” (i.e., reduced) for people with an adjusted gross income (AGI) above a certain amount. If you filed your most recent tax return as a single filer, your payment will be reduced if your AGI is over $75,000. It will be completely phased-out if your AGI is $80,000 or more. For head-of-household filers, the phase-out begins when AGI reaches $112,500 and payments are reduced to zero when AGI hits $120,000. Married couples filing a joint return will see their third stimulus check drop if their AGI exceeds $150,000 and completely disappear when AGI is $160,000 or more.

The IRS will look at your 2019 or 2020 tax return to determine your filing status, AGI, and information about your dependents. If you don’t file a 2019 or 2020 return, the IRS can sometimes get the information it needs from another source. For instance, it can get information from the Social Security Administration, Railroad Retirement Board, or Veterans Administration if you’re currently receiving benefits from one of those federal agencies (although the IRS might not get all the information it needs to send a full payment). If you supplied the IRS information last year through its online Non-Filers tool or by submitting a special simplified tax return, the tax agency can use that information, too.

If your 2020 tax return isn’t filed and processed by the time it starts processing your third stimulus check, the IRS will base your payment on your 2019 return or whatever other information is available. If your 2020 return is already filed and processed, then your stimulus check will be based on that return. If, however, your 2020 return is not filed and/or processed until after the IRS sends your third stimulus check, but before August 16, 2021, that’s when the IRS will send you a supplemental payment for the difference between what your payment should have been if based on your 2020 return and the payment actually sent that was based on your 2019 return or other data.

(Note: The IRS is experiencing tax return processing delays. So, even if you submit your 2020 return before the IRS sends your stimulus check, your payment still might be based on your 2019 return because your 2020 return isn’t processed in time. Returns filed electronically are generally processed faster than paper returns.)

If the American Rescue Plan didn’t authorize supplemental payments, you would still get your money if the payment based on your 2020 tax return is higher than the payment you actually received – but you would have to wait until next year to get it. Without a “pull-up” payment, you would have to claim the difference as a Recovery Rebate credit on your 2021 tax return, which you won’t file until 2022.

[Use our Third Stimulus Check Calculator to compare your payment if it’s based on your 2019 return vs. your 2020 return. Just answer three easy questions to get a customized estimate.]

Who Will Get a Supplemental “Plus-Up” Payment

Again, you’ll only get a supplemental “plus-up” payment if you received a third stimulus check based on your 2019 tax return or other information, but you would have gotten a larger check if the IRS based it on your 2020 return. So, who falls into this category? Of course, it depends on your specific circumstance. However, to give you a general idea, here are a few examples of hypothetical taxpayers who would get a supplemental payment.

You Had Less Income in 2020 Than in 2019: Kay was unemployed for much of 2020. As a result, her AGI dropped from $78,000 in 2019 to $40,000 in 2020. Kay received a $560 third stimulus check that was based on her 2019 return (she is single with no dependents). Since her 2019 AGI was above the phase-out threshold for single filers ($75,000), her payment was reduced. Kay later files her 2020 tax return, which is processed before August 16, 2021. Since Kay’s 2020 AGI is well below the applicable phase-out threshold, her third stimulus check would have been for $1,400 if it were based on her 2020 return. As a result, Kay will receive a $840 supplemental payment ($1,400 – $560 = $840).

You Had a Baby in 2020: Josh and Samantha had their first child in 2020. They’ve been married for five years, and they file a joint return each year. Their AGI was $110,000 in 2019 and $120,000 in 2020, which are both below the phase-out threshold for joint filers ($150,000). The IRS sent Josh and Samantha a $2,800 third stimulus check based on their 2019 return. They filed their 2020 tax return before the IRS sent the payment, but the return was not processed until a week after the payment was sent. That’s why the payment was based on their 2019 return. Since Josh and Samantha claimed their new bundle of joy as a dependent on their 2020 return, their stimulus check would have been for $4,200 if it were based on their 2020 return (i.e., they would have received an additional $1,400 for their baby). As a result, the IRS will send Josh and Samantha a $1,400 supplemental payment ($4,200 – $2,800 = $1,400).

You Got Married in 2020: Patty and Greg were married in 2020. They had a combined AGI of $150,000 in 2020 and have no dependents. In 2019, as separate single filers, Patty had an AGI of $72,000 and Greg had an AGI of $78,000. The IRS sent Patty a $1,400 third stimulus check based on her 2019 return. Since her 2019 AGI was below the phase-out threshold for single filers ($75,000), her payment was not reduced. The IRS sent Greg a $560 third stimulus check based on his 2019 return. Since his 2019 AGI was above the phase-out threshold for single filers, his payment was reduced. Between the two of them, they got a total of $1,960 in third stimulus check payments ($1,400 + $560 = $1,960). After receiving their stimulus checks, Patty and Greg file a joint return for the 2020 tax year that is processed before August 16, 2021. Since the AGI reported on their 2020 joint return does not exceed the phase-out threshold for joint filers ($150,000), their stimulus check would have been for $2,800 if it were based on their 2020 return (i.e., it wouldn’t have been reduced). As a result, the IRS will send Patty and Greg a $840 supplemental payment ($2,800 – $1,960 = $840).

You Used the Non-Filers Tool Last Year: Mary is single and has two dependent children. One turned 15 and the other turned 18 in 2020. Mary was not required to file a 2019 tax return, but she did use the IRS’s Non-Filers tool last year to get a first-round stimulus check. Since children over 16 did not qualify for the extra $500 payment for first-round payments, Mary only reported her youngest child to through the tool. The IRS sent Mary a $2,800 third stimulus check based on the information it received through the Non-Filers tool. Mary later files a 2020 tax return, which is processed before August 16, 2021. She used the head-of-household filing status, reported an AGI of $15,000, and claimed both of her children as dependents. For third-round stimulus checks, an additional $1,400 is added to the total payment for each dependent regardless of the dependent’s age. Since Mary’s 2020 AGI is below the phase-out threshold for head-of-household filers ($112,500), her third stimulus check would have been for $4,200 if it were based on her 2020 return. As a result, Mary will receive a $1,400 supplemental payment ($4,200 – $2,800 = $1,400).

A Federal Agency Supplied Information to the IRS: Ron is a disabled veteran who receives benefits from the Department of Veterans Affairs (VA). He is single and has one dependent child. Ron was not required to file a 2019 tax return, but the VA sent information to the IRS about Ron. The VA did not send any information about Ron’s child. Based on the information it had, the IRS sent Ron a $1,400 third stimulus check. After receiving this payment, Ron files a 2020 tax return, which is processed before August 16, 2021. Ron filed as a single person with an AGI of $18,000 and one dependent. Since Ron’s 2020 AGI does not exceed the phase-out threshold for single filers ($75,000), his third stimulus check would have been for $2,800 if it were based on his 2020 return. As a result, the IRS will send Ron a $1,400 supplemental payment ($2,800 – $1,400 = $1,400).


Where Can I Cash My Stimulus Check?

There are three ways to receive your $1,400 third stimulus check (if you’re eligible to receive one). You could have it deposited directly into your bank account, you could receive a prepaid debit card, or you could receive a paper check in the mail. Over 100 million Americans have already received electronic third stimulus payments from the IRS via direct deposit. About 5 million debit cards have been sent, and the IRS has already mailed paper checks over 15 million more people.

If you end up getting a paper stimulus check, you can either cash it or deposit it into your existing bank account. But what if you don’t have a bank account—what are your options? Assuming you don’t want to open a bank account with your stimulus check, here are a few other ideas to consider. (Use our Third Stimulus Check Calculator to see how much you should get.)

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Ask a Local Bank to Cash Your Stimulus Check

picture of person receiving cash from a bank tellerpicture of person receiving cash from a bank teller

Since government checks are considered “safe,” some banks will cash stimulus checks for non-customers—but you might have to pay a fee. While many banks are waiving fees for stimulus checks, it’s best to call ahead to make sure. If there is a fee, it could run anywhere from $5 to over $20. Also make sure you bring at least two photo IDs with you (e.g., driver’s license, passport, military ID, etc.).

The Federal Deposit Insurance Corporation (FDIC), which helps regulate banks and insures bank deposits, has encouraged financial institutions to work with people impacted by the coronavirus crisis, including by waiving fees and easing restrictions on cashing non-customer checks. So, hopefully, there’s a bank (or credit union) near you that will cash your stimulus check without a fee.

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Go to Walmart (or Another Store that Cashes Checks)

picture of a Walmart storepicture of a Walmart store

Some large retailers will cash your stimulus check for you. Expect to pay a fee, though. Walmart, for example, will cash a government check of up to $5,000. Their fee is $4 for a check up to $1,000; $8 for a check above that amount. You can also have the amount of your stimulus check added to a Walmart “MoneyCard,” which is a prepaid debit card.

Your neighborhood grocery store might cash your check, too. For example, if you shop at Kroger, Dillons, King Soopers, Smith’s, Fry’s Food, or another affiliated grocery store with a Money Services counter, you can cash your stimulus check for a small fee (restrictions may apply). Other grocers across the country cash government checks—so touch base with your local store to see if they offer this service.

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Have the Money Credited to a PayPal (or Similar) Account

picture of PayPal screen on a phonepicture of PayPal screen on a phone

PayPal has a service that lets you cash checks and have the amount credited to a PayPal “Cash Plus” account. You can do it all on your phone or other mobile device using the PayPal app. Just take a picture of the check and send it for approval. You pay a fee if you want the money credited to your account immediately, but there’s no fee if you can wait 10 days. And now for the good news—PayPal is waiving the fees for paper stimulus checks, so you can get the money into your PayPal account right away for free.

Convenience story giant 7-Eleven also has a debit card program that you can use. Anyone with a Trans@ct Card can cash a check and apply the funds to your debit card account using a smart phone. Undisclosed fees may apply, though (see the cardholder agreement for details).

Netspend, Ingo Money, Venmo, and others provide similar services that let you cash a stimulus check using your phone. Again, make sure you understand the fees before you sign up.

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Visit a Cash-Checking Store

picture of check cashing businesspicture of check cashing business

Every city and even many small towns have cash-checking businesses that will handle a stimulus check for you. However, there’s a good chance you’ll pay higher fees at these stores than if you use one of the other options discussed above. For some people, though, the extra cost is worth it because of the store’s hours, location, or additional services—and you don’t have to have a pre-existing relationship with them.

Some states limit the fees charged by check-cashing businesses. Pennsylvania, for example, limits the charge for cashing a government check to 1.5% of the check’s face value (or $21 for a $1,400 stimulus check). In California, the maximum fee for cashing a government check is $3. In other states, like Michigan or Texas, check-cashing businesses are not regulated. As a result, there is no limit on the fees businesses in these states can charge for their services.


7 Reasons Why Your Third Stimulus Check Could Be Delayed or Denied

Did you get your third stimulus check yet? If the answer is “no,” then you might be waiting a while longer to get your payment. The IRS started delivering third-round stimulus checks in mid-March, and millions of Americans have already received their payment. If all your friends and family members already have their money, but your pockets are still empty, you could be in for a long delay. And, for some people, a third stimulus check will never arrive.

You can use the IRS’s “Get My Payment” tool to track the status of your third stimulus check…but that won’t make it arrive any faster (or ever). The best thing to do is try to understand why your payment is delay or won’t ever come, and then act accordingly. Read on to see 7 reasons why your third stimulus check could be held up or denied. But if you’re eligible for a third stimulus check, just know that you’ll eventually get your money one way or another.

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You Have a New Bank Account

picture of checking account application formpicture of checking account application form

Your third stimulus check payment will be directly deposited into your bank account if the IRS has your bank information from:

  • Your 2019 or 2020 federal income tax return (Form 1040);
  • The “Non-Filers: Enter Payment Info Here” tool used for first-round stimulus payments;
  • The “Get My Payment” tool, if the information was provided in 2020;
  • A federal agency that issued benefits to you (e.g., the Social Security Administration, Department of Veteran Affairs, or Railroad Retirement Board); or
  • Federal records of recent payments to or from the government.

Direct deposit is the quickest and easiest method of delivering your payment. However, if you recently closed the bank account that the IRS has on record, then the payment will be delayed. By law, the bank must return the payment to the IRS if the account is inactive or closed. Unfortunately, if you closed your account, there’s no way to provide the IRS with your new bank account information for third stimulus check purposes. As a result, you will either receive a paper check or debit card by mail.

If the IRS sends a paper check or debit card, that will take longer than getting a direct deposit payment because it has to go through the regular mail.

If the IRS doesn’t send a third-round payment at all, then you’ll have to claim the third stimulus check money that you should have received as a Recovery Rebate credit on your 2021 income tax return, which you won’t file until next year.

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You Didn’t File a 2019 or 2020 Tax Return

picture of crumpled tax form and broken pencilpicture of crumpled tax form and broken pencil

Generally, the IRS will look at your 2019 or 2020 tax return to see if you’re eligible for a third stimulus check and, if so, to determine the amount of your check. If you didn’t file a 2019 or 2020 return (not everyone is required to file one), then the IRS is stuck. It doesn’t have the information it needs to send you a payment readily available.

The IRS can get the necessary information from another federal agency that is paying you benefits (e.g., from the Social Security Administration, Railroad Retirement Board, or Department of Veterans Affairs). Once it gets the information, the IRS can send you a payment – but waiting to get that information is something else that could cause a delay. For example, the IRS is just now starting to process payments for millions of Social Security recipients. Many veterans receiving VA benefits will have to wait until mid-April or even longer. (Also note that federal beneficiaries will generally receive their third stimulus payment in the same manner that they get their regular benefits.)

If the IRS isn’t able to get the information needed to process your payment (or a full payment), then you’ll have to claim the amount you’re entitled to as a Recovery Rebate credit on your 2021 tax return. But there’s an easy way to avoid this – simply file a 2020 tax return, even if you don’t have to.

There’s still plenty of time to file a 2020 return. The IRS pushed back this year’s return filing deadline from April 15 to May 17, 2021, so you have an additional month to get your 2020 return to the IRS. The tax agency has until the end of the year to send out third-round stimulus payments, so you can still get a check if you haven’t filed yet – it will just take longer for you to get it.

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You Recently Moved

picture of family loading moving vanpicture of family loading moving van

If, for whatever reason, you’re scheduled to receive a paper check or debit card in the mail (rather than a direct deposit payment), the IRS is going to send your third stimulus check or debit card to the address it has on record. The fact that your payment is being sent through the mail is enough on its own to cause a delay, but you’re going to wait even longer to get your money if you recently moved and the IRS sends your payment to the wrong address.

If the U.S. Postal Service is forwarding your mail to your new address, your third-round stimulus payment will eventually show up in your mailbox. But, of course, it will take even more time and add to the delay.

On the other hand, if the Postal Service can’t deliver your payment and returns it to the IRS, you’ll be given the opportunity to have your payment directly deposited to a:

  • Bank account;
  • Prepaid and reloadable debit card; or
  • Alternative financial product that has a routing and account number associated with it.

You’ll use the IRS’s “Get My Payment” tool to send authorize the direct deposit. Although direct deposit is faster than having a reissued payment sent by mail, the whole process of having your payment returned to the IRS and then arranging for a direct deposit payment will still take quite a bit of time.

If you don’t sign up for direct deposit after your initial payment is returned to the IRS, it will take even longer to receive your third stimulus check. In that case, the IRS won’t reissue your payment until it receives an updated address (e.g., by filing a 2020 tax return or notifying the IRS).

If, after your initial payment is return by the Postal Service, you don’t sign-up for direct deposit or provide the IRS with your new address, you won’t get a third payment and will have to claim your third stimulus check amount as a Recovery Rebate credit on your 2021 tax return.

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You’re Married and Filed a Joint Tax Return

picture of elderly married couple embracingpicture of elderly married couple embracing

If you’re married and filed a joint tax return, half of your third stimulus payment might be delayed. That’s because the IRS is sending two separate payments to some joint filers. (Don’t ask me why.) The first half may come as a direct deposit, which you may have already received. But the other half is then mailed to the address the IRS has on file, which is generally the address on your most recent tax return or as updated through the U.S. Postal Service. The second payment could come the same week as the first one…or it might not arrive for a few weeks.

If you’re a joint filer and only get half of what you should have received, both you and your spouse should check the IRS’s “Get My Payment” tool separately using your own Social Security number to see the status of your payments.

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You’re in Debt

picture of two credit cards, the word "Debt" in red, and an arrow chart indicating increasing debtpicture of two credit cards, the word "Debt" in red, and an arrow chart indicating increasing debt

Third stimulus checks can’t be reduced to pay child support, federal taxes, state income taxes, debts owed to federal agencies, or unemployment compensation debts. (If you owed child support, the IRS could use first-round stimulus check money to pay arrears.) However, protections that were in place for second-round stimulus checks to prevent garnishment by private creditors or debt collectors don’t apply for third-round payments. Third stimulus checks can be lost in bankruptcy proceedings, either.

As a result, not only could your access to third stimulus check funds be delayed, but your entire payment could be taken. If you receive a paper stimulus check in the mail, you might be able to avoid garnishment by cashing the check instead of depositing it into your bank account.

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You Make Too Much Money

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You won’t get a third stimulus check at all if your income is too high. Every eligible American starts with a $1,400 third stimulus check “base amount.” The base amount goes up to $2,800 for married couples filing a joint tax return. Then, for each dependent in your family, an extra $1,400 will be added to the base amount.

However, everyone won’t get the full amount. As with the first two stimulus payments, third-round stimulus checks will be “phased-out” (i.e., reduced) for people with an adjusted gross income (AGI) above a certain amount on their 2019 or 2020 tax return. If you filed your most recent tax return as a single filer, your third stimulus check will be phased-out if your AGI is $75,000 or more. That threshold increases to $112,500 for head-of-household filers, and to $150,000 for married couples filing a joint return.

Third-round stimulus checks are reduced to zero pretty quickly. They are completely phased out for single filers with an AGI above $80,000, head-of-household filers with an AGI over $120,000, and joint filers with an AGI exceeding $160,000.

However, if you don’t get a third stimulus check (or you don’t get a full one) because your 2019 or 2020 income is too high, you still might qualify for a Recovery Rebate credit on your 2021 tax return. That’s because the tax credit will be based on your 2021 AGI, which could be lower than either your 2019 or 2020 income. For example, if you’re single and your 2020 AGI was above $80,000, you don’t qualify for a third stimulus check. But what if your 2021 income drops to under $75,000. In that case, you’re eligible for a $1,400 Recovery Rebate credit on your 2021 tax return.

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You’re Not Eligible for a Third Stimulus Check

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Not everyone is eligible for a third stimulus check. In a nutshell, you generally don’t qualify for a third-round payment if:

  • You could be claimed as a dependent on someone else’s tax return;
  • You don’t have a Social Security number; or
  • You’re a nonresident alien.

(Estates and trusts, and people who died before 2021, are also not eligible.) If the IRS determines that you’re not eligible for a third-round stimulus check, then you won’t get one.

There are a few exceptions to the Social Security number requirement. For instance, an adopted child can have an adoption taxpayer identification number (ATIN) instead of a Social Security number. For married members of the U.S. armed forces, only one spouse needs to have a Social Security number. And if your spouse doesn’t have a Social Security number, you can still receive a third stimulus check if you have one.

However, as with people with higher incomes, being ineligible for a third stimulus check doesn’t necessarily mean you’re also ineligible for a Recovery Rebate credit when you file your 2021 tax return. For example, if you’re no longer a dependent or get a Social Security number in 2021, then you may be eligible for the 2021 credit. Even though you’ll have to wait, you don’t leave money on the table if it’s available!

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Stay on Top of Stimulus Check Developments

The words stimulus plan on paper atop U.S. currencyThe words stimulus plan on paper atop U.S. currency

Follow Kiplinger for the latest news and insights on federal stimulus payments (and other important personal-finance matters). Stay with us on:

See some of our other coverage of the third stimulus check:


Veterans to Get Third Stimulus Check by Mid-April

Veterans who didn’t filed a 2019 or 2020 tax return or use the IRS’s Non-filer tool last year may have to wait a bit longer to receive a third stimulus check. That’s because the IRS is still reviewing data sent over from the Department of Veterans Affairs (VA) that it needs to process third-round stimulus payments for them. The tax agency currently estimates that stimulus payments for VA beneficiaries who don’t regularly file a tax return could be sent by mid-April.

Third-round stimulus payments are generally based on information included on either a 2019 or 2020 tax return. That’s why many veterans who receive VA benefits who filed a 2019 or 2020 return already received a third stimulus check. However, if you don’t file a return, the IRS has to look elsewhere for the necessary information. The Non-filers tool that the IRS set up last year to collect data for first-round stimulus checks is one possible source for the needed data. Another is a federal agency that pays you benefits on a regular basis – such as the Department of Veterans Affairs for certain veterans. But once information is sent by another federal agency, the IRS must go through a multi-step process to validate and test the data. That’s what’s happening now with the files sent to the IRS by the VA.

Most VA beneficiaries who are eligible for a third stimulus check won’t need to take any action to receive a payment. But some veterans may still need to file a 2020 tax return – even if they don’t usually file one – to get an extra $1,400 for each dependent in their family. That’s because the data sent by the VA won’t necessarily include information about your dependents. (The deadline for filing a 2020 tax return is May 17, 2021.) If you don’t file a 2020 tax return, you can still claim the additional amount you’re entitled to by filing a 2021 tax return next year and claiming the Recovery Rebate credit.

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Social Security Recipients to Get Payments Sooner

The IRS also received data from the Social Security Administration that will allow it to send payments to seniors who didn’t file a 2019 or 2020 tax return or use the Non-filer tool last year. This data is being processed sooner. As a result, Social Security recipients are expected to start receiving payments on April 7.

Track the Status of Your Third Stimulus Check

Once the stimulus payments are processed, veteran non-filers will be able to track those payments on the IRS’s “Get My Payment” tool. The online portal tells you:

  • The status of your stimulus payment;
  • The form of your payment (paper check or direct deposit); and
  • The projected direct deposit or paper check delivery date.

For more information about the tool, see Where’s My Stimulus Check? Use the IRS’s “Get My Payment” Tool to Get an Answer.

How Much Money Will Veterans Get?

Every eligible American will receive a $1,400 third stimulus check “base amount.” The base amount jumps to $2,800 for married couples filing a joint tax return. You also get an extra $1,400 for each dependent in your family (regardless of the dependent’s age).

People with a higher income won’t receive the full amount, though. Third-round stimulus checks will be reduced – sometimes to zero – for anyone with an adjusted gross income (AGI) above a certain amount on their latest tax return. If you filed your most recent tax return as a single filer, your third stimulus check will be phased-out if your AGI is $75,000 or more. That threshold jumps to $112,500 for head-of-household filers, and to $150,000 for married couples filing a joint return. Third-round stimulus checks will be completely phased out for single filers with an AGI above $80,000, head-of-household filers with an AGI over $120,000, and joint filers with an AGI exceeding $160,000.

Trying using our Third Stimulus Check Calculator to see how much you’ll get. Just answer three easy questions to get a customized estimate.

For more information about third-round stimulus payments, see Your Third Stimulus Check: How Much? When? And Other FAQs.


8 Tax Tips for Gambling Winnings and Losses

March Madness is here! It’s one of the most exciting times on the annual sports calendar. From the conference tournaments to the cutting of the championship nets, millions of people are tuned in to college hoops and following their favorite teams for weeks of basketball bliss.

And, of course, there’s the betting. Through office pools, casinos, online gambling and more, billions of dollars are wagered on the Big Dance each year. But if you’re lucky enough to win some cash for having the best bracket or correctly picking the Final Four, don’t forget that Uncle Sam wants his cut, too. So, before you run out and spend your March Madness jackpot, here are 8 things to remember about taxes on gambling winnings and losses.

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You Have to Report All Your Winnings

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Whether it’s $5 or $5,000, from an office pool or from a casino, all gambling winnings must be reported on your tax return as “other income” on Schedule 1 (Form 1040), line 8. If you win a non-cash prize, such as a car or a trip, report its fair market value as income.

And, please, make sure you report all your gambling winnings. If you won $500, report $500. The IRS isn’t hunting down small-time winners, but you still don’t want to think of yourself as a tax cheat.

NOTE: Prizes won in a contest that doesn’t involve betting are taxable, too. For instance, if you fill out a bracket for ESPN’s Tournament Challenge or CBS Sports’ Bracket Games (there’s no fee) and win a prize, you must report the fair market value of the prize (or, if cash, the amount won) as “other income” on Schedule 1. If the prize is worth $600 or more, you should receive a Form 1099-MISC with the prize amount/value listed in Box 3. The IRS will receive a copy of the 1099-MISC, too.

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You Might Get a Form W-2G

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Generally, you’ll receive an IRS Form W-2G if your gambling winnings are at least $600 and the payout is at least 300 times the amount of your wager. The thresholds are $1,200 for bingo or slot machine winnings, $1,500 for keno winnings and $5,000 for poker tournament winnings (and the payout doesn’t have to be 300 times the wager for these types of winnings). Your reportable winnings will be listed in Box 1 of the W-2G form.

If a W-2G is required, the payer (sports betting parlor, casino, racetrack, etc.) will need to see two forms of identification. One of them must be a photo ID. You’ll also have to provide your Social Security number or, if you have one, an individual taxpayer identification number.

In some cases, you’ll get the W-2G on the spot. Otherwise, for this year’s winnings, the payer must send the form to you by January 31, 2022. In any event, if your bet was with a casino, we’re fairly certain you’ll get the W-2G. But if your bet was just a friendly wager with a friend or you won the office pool … well, don’t count on it.

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Withholding Might Be Required

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Generally, if you win more than $5,000 on a wager and the payout is at least 300 times the amount of your bet, the IRS requires the payer to withhold 24% of your winnings for income taxes. (Special withholding rules apply for winnings from bingo, keno, slot machines and poker tournaments.) The amount withheld will be listed in Box 4 of the W-2G form you’ll receive. You’ll also have to sign the W-2G stating, under penalty of perjury, that the information listed on the form is correct.

When you file your 1040 next year, include the amount withheld as federal income tax withheld (line 25c on your 2020 tax return). It will be subtracted from the tax you owe. You’ll also have to attach the W-2G form to your return.

Again, this is what to expect when you plunk down a bet at a casino or with some other legally operated gaming business … don’t expect your buddy or the guy in accounting who’s running the office pool to withhold taxes when you have the best bracket at work (although, technically, they should).

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Your Losses Might Be Deductible

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Hey, picking March Madness winners can be tough. There are always upsets, and a lot of brackets are busted after the first weekend. But there’s a silver lining if you lost a bet or two on tournament games—your gambling losses might be deductible. (Gambling losses include the actual cost of wagers plus related expenses, such as travel to and from a casino.)

There are a couple of important catches, though. First, unless you’re a professional gambler (more on that in a second), you have to itemize in order to deduct gambling losses (itemized deductions are claimed on Schedule A). Since the 2017 tax reform law basically doubled the standard deduction, most people aren’t going to itemize anymore. So if you claim the standard deduction, you’re out of luck twice—once for losing your bet and once for not being able to deduct your gambling losses.

Second, you can’t deduct gambling losses that are more than the winnings you report on your return. For example, if you won $100 on one bet but lost $300 on a few others, you can only deduct the first $100 of losses. If you were totally down on your luck and had absolutely no gambling winnings for the year, you can’t deduct any of your losses.

If you’re a professional gambler, you can deduct your losses as business expenses on Schedule C without having to itemize. However, a note of caution: An activity only qualifies as a business if your primary purpose is to make a profit and you’re continually and regularly involved in it. Sporadic activities or hobbies don’t qualify as a business.

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Report Winnings and Losses Separately

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Gambling winnings and losses must be reported separately. Say, for example, you made four separate $100 bets on Gonzaga, Alabama, Baylor and Illinois making it to the Final Four. If one of those bets came through for a $500 payout, you must report the full $500 as taxable income. You can’t reduce your gambling winnings ($500) by your gambling losses ($400) and only report the difference ($100) as income. If you itemize, you can claim a $400 deduction for your losses, but your winnings and losses must be handled separately on your tax return.

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Keep Good Records

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To help you keep track of how much you’ve won or lost over the course of a year, the IRS suggests keeping a diary or similar record of your gambling activities. At a minimum, your records should include the dates and types of specific wagers or gambling activities, name and address/location of each casino you visited, names of other people with you at each casino, and the amounts you won or lost.

You should also keep other items as proof of gambling winnings and losses. For example, hold on to all W-2G forms, wagering tickets, canceled checks, credit records, bank withdrawals, and statements of actual winnings or payment slips provided by casinos.

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Audit Risks May Be Higher

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If you receive a W-2G form along with your gambling winnings, don’t forget that the IRS is getting a copy of the form, too. So, the IRS is expecting you to claim those winnings on your tax return. If you don’t, the tax man isn’t going to be happy about it.

Deducting large gambling losses can also raise red flags at the IRS. Remember, casual gamblers can only claim losses as itemized deductions on Schedule A up to the amount of their winnings. It’s a slam dunk for IRS auditors if you claim more losses than winnings.

Be careful if you’re deducting losses on Schedule C, too. The IRS is always looking for supposed “business” activities that are really just hobbies.

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State and Local Taxes May Apply

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If you look carefully at Form W-2G you’ll notice that there are boxes for reporting state and local winnings and withholding. That’s because you may owe state or local taxes on your gambling winnings, too.

The state where you live generally taxes all your income—including gambling winnings. However, if you travel to another state to plunk down a bet, you might be surprised to learn that the other state wants to tax your winnings, too. And they could withhold the tax from your payout to make sure they get what they’re owed. You won’t be taxed twice, though. The state where you live should give you a tax credit for the taxes you pay to the other state.

You may or may not be able to deduct gambling losses on your state tax return. Check with your state tax department for the rules where you live.


What To Do if a Tax Document Arrives After You File

In early 2019, I thought all of my tax documents had arrived in the mail, so I sat down to file my taxes in early March. Everything looked great, so I submitted my return to the IRS and went on about my merry business.

In early April, however, an unexpected document popped up in the mail. It was a 1099 form for a very small amount of freelance work I had done the previous year and forgotten about. For whatever reason, the document hadn’t been sent to me until fairly close to that year’s tax deadline.

This was an unhappy situation, to be sure. Would I be hit with any fees or interest charges? What documents do I need to file? Should I just “pretend” I didn’t see it? (Quick answer to that last one: No.) Here’s what you need to know about situations like these.

In this article

Why would this happen?

Most of the time, people receive all of their tax documents by early February and move on to file their income taxes with the IRS by the filing deadline (mid-April in most years, mid-May in 2021). However, that path isn’t always smooth. There are a few reasons why you might not receive a tax document until after you’ve already filed your taxes.

One common reason is that it may have actually been lost in the mail. If an item is not delivered properly and gets lost in the mail system, it can show up weeks or months after it was sent.

Another reason is that the person or business preparing the tax document was delayed in their preparation. Most larger businesses have accounting services that do this very efficiently on their behalf, but some businesses may try to tackle this on their own. If a business fails to get their own paperwork organized and filed, then they may fail to get your tax documents to you efficiently as well. The IRS deadline for sending most tax documents to individuals is Jan. 31, but businesses can and do fall behind that deadline, and that can result in documents arriving at your doorstep quite late.

Am I in trouble?

If this happens to you, you are not immediately in any sort of trouble. You committed no fraud and did not intentionally miss any deadlines. The IRS is actually very flexible and forgiving in these types of situations.

However, once you have the document in hand, you can’t ignore it. The IRS is likely aware of the situation, as the person or business that sent you the tax document has very likely also filed it with the IRS directly. The only reason they wouldn’t contact you is if they simply happen not to notice it. Furthermore, the longer you sit on the document, the more likely it becomes that you’ll face late fees and fines and other penalties.

What happens if you do ignore it? No matter what, you are committing tax fraud. The question is whether the IRS happens to notice the fraud. Your best approach is to handle it immediately, as that will minimize and likely eliminate any late fees and penalties.

Your best approach with the IRS is always to take action immediately on your own behalf to set the record straight. Follow the steps below as soon as possible so that a tax mistake due to someone else’s negligence doesn’t turn into your own tax fraud. If you wait, you might not be noticed by the IRS, but if they do notice you, you’ll face many difficulties and tax penalties.

How to handle a late tax document

Ideally, you’ve received the tax document before the IRS has contacted you about it. In that situation, the process is pretty straightforward. You simply file IRS 1040-X, which amends your tax return with updated information. If you used tax filing software such as TurboTax, this is done very easily within the software. If you used a tax preparer, simply contact your tax preparer immediately.

If the new tax documents indicated that you earned more income than you initially reported, this may result in you owing more taxes. Don’t worry — the amount of actual tax you owe will always be just a relatively small percentage of the new income you’re reporting. Don’t fear a higher tax bracket, as it doesn’t mean you’ll suddenly owe a ton more in taxes. If the additional amount you owe is trivial, simply pay it. If it is enough that it may cause you hardship, you will want to contact the IRS directly to discuss your options.

In some situations, particularly if you receive the tax document far past the filing deadline, you may be subject to additional fines or fees. In that situation, contact the IRS directly. You may be eligible to file Form 843, which will request a waiver of those fines and fees. Again, the IRS is flexible with those who are proactive about paying the taxes they owe and will often waive fees in situations outside of your control.

How I handled late tax documents

How did I handle my own late document? The IRS had not yet contacted me about it, so I quickly filed a 1040-X form along with a small additional tax payment (as the late form showed additional income that I hadn’t filed originally). There were no fees involved and the IRS never contacted me about it in any way. The process was simple and took less than 30 minutes. I spent more time worrying about it than it actually took to resolve the situation.

If I had waited to file the document, the IRS may have contacted me about it. In that situation, I would have owed the taxes, as well as potential interest on the unpaid taxes and other penalties as well. Simply taking care of it immediately and paying the taxes I actually owed made it into a minor issue.

See a tax professional about your specific situation; this article is for informational purposes and not intended as expert advice. We welcome your feedback on this article. Contact us at with comments or questions.


10 States With the Highest Beer Taxes

There’s nothing like cracking open a cold one at the end of a hot summer’s day. But the dollars and cents you’re drinking away without even realizing it can leave a bitter aftertaste. In addition to paying the federal tax of up to $0.58 per gallon,* consumers face state taxes for beer — typically paid by brewers and distributors before the beer reaches store shelves, but nonetheless impacting the final cost of a cold brew. In fact, 40% of the retail price of beer comes from taxes — the most expensive ingredient, according to the Beer Institute.

Check out our list of the 10 states with the highest beer tax. That way you can budget accordingly the next time you’re visiting one of these areas and planning to bar hop.

*Federal beer taxes are lower for smaller breweries.

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There are “wet” and “dry” counties in Mississippi, which means there are some jurisdictions where it’s illegal to sell alcohol of any kind. In those that do allow it, residents can purchase beer and light wine at convenience and grocery stores, but not liquor. Those are available at off-premise sites, such as liquor stores. If you’re in a county where beer can be sold, just know that you’ll have to plunk down an extra 43¢ per gallon for a cold one.

Lazy Magnolia, which was established in Kiln in 2005, became Mississippi’s first packaging brewery since prohibition. Their roster of ales — from “Southern Pecan” to “Grapefruit Radler” — can also be purchased in Arkansas, Colorado and West Virginia, among several other states.

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In Idaho, beer with alcohol by weight exceeding 4% is categorized as a strong beer and taxed as wine. That explains why the rate for both beer and wine in the Gem State is priced at 45¢ per gallon. Beer containing less than 4% of alcohol by weight is taxed at a rate of 15¢ per gallon. 

One of the more unique brewery concepts comes from Boise Brewing, which opened in 2014 in the state’s capital city of Boise. It’s a community-owned brewery. So, in addition to having an initial round of traditional investors, everyday customers who were willing to make a minimum investment contribution became part-owners in the company, as well.

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Pouring up in the Sunshine State will cost you — no matter if you’re drinking a mug of beer, a glass of wine or sipping on a cocktail. At 48¢ per gallon, the beer tax rate is costly; especially when you consider that in Wyoming — which has the lowest rate — it’s just 2¢ per gallon. The wine and liquor rates in Florida are even steeper. Still wine, which isn’t effervescent, is set at $2.25. However, the cost per gallon for a sparkling version bumps up to $3.50. And spirits with an alcohol content above 56% — some barrel-proof whiskeys, for example — are $9.53 per gallon.

There are more than 300 breweries located in Florida — from mom and pop businesses to warehouse set-ups, according to Among them is Bowigens Beer Company, which was started by two friends in their garage in 2014. Since then, the brewery’s “7 Layer Milk Stout” beer has racked up multiple awards including the 2019 Best of Craft Beer Award.

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North Carolina

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You’d think North Carolina would be on the lax side when it comes to taxing beer. After all, they’re soft on other “sin taxes” — the excise tax for cigarettes is only $0.45 per pack, one of the lowest in the U.S. If you still crave a brew despite the high tax (62¢ per gallon), there are plenty of good options. Asheville, N.C., is home to the second-most breweries per capita of any city in the country. And it wouldn’t be fair to mention what’s been dubbed “Beer City USA” without naming the godfather of its scene, Oscar Wong, who opened Highland Brewing Company in a basement back in 1994.

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South Carolina

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South Carolina doesn’t make it easy on brewers. Its 77¢ per gallon tax rate on beer is among the highest in the country. But other alcohol doesn’t get as bad a deal — the state’s wine tax and spirit tax fall roughly in the middle of the pack in the U.S. 

But if you’re still game for a cold one, South Carolina has a few big dogs to look out for. The Palmetto Brewing Company revived brewing in South Carolina (dead since Prohibition) in 1993. The brewery offers a rotating selection of small batch and experimental brews on tap. Among the state’s smaller breweries is the family-owned COAST Brewing Co., which uses all locally sourced ingredients to produce their brews.

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picture of Kohola Brewery beerpicture of Kohola Brewery beer

You’re going to pay top dollar to drink up in the Aloha State. Hawaii’s beer tax is pretty steep at 93¢ per gallon. It’s per gallon tax rate on wine is nearly $1.50, but jumps to $2.12 if it’s a sparkling variety (think: Prosecco or Moscato).

When it comes to beer in Hawaii, the big name brand you’ve likely heard of is Kona Brewing Co. It’s been around for over 25 years. But the “liquid aloha” drink was bought by Craft Brew Alliance in 2010, so much of its production is now in Portland, Ore., Portsmouth N.H., and Fort Collins, Colo. If you’re in Maui (or visiting), check out the Kohola Brewery in the heart of Lahaina. Founded by homebrewers, Kohola adds pineapple, lilikoi or coconut to give its beers a Hawaiian touch.

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At $1.01 per gallon (includes mandatory 53¢ per gallon local tax), it’s no surprise that the Peach State is among our top five states with the highest beer tax in the country. As for other types of alcohol, Georgia enforces an excise tax on a variety of wines (table, dessert and fortified), as well as distilled spirits and malt beverages.

The state’s oldest craft brewery, Atlanta Brewing Company, was founded in 1993. The brewery’s flagship “Red Brick” ale became so popular that 4,000 barrels were produced in its first year of production. Atlanta Brewing Company now has 28 beer varieties on tap including Hoplanta IPA and Soul of the City pale ale.

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At $1.05 per gallon (includes mandatory 52¢ per gallon local tax), Alabama’s beer tax isn’t exactly a bargain, but it’s on the lighter side compared to other alcohol sales in the state. The tax on spirits is the highest among the states on this list, and the tax on wine is the third-highest. So if you’re bar-hopping and looking for a cheap drink, you might just want to turn to the tap.

Good People Brewing Company is the state’s oldest and largest brewery. It was established in Birmingham in 2008. In addition to Alabama, the brewery’s beers can be purchased in several states throughout the Southeast region, including Georgia, Tennessee and Florida.

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picture of Alaskan Brewing Company beerpicture of Alaskan Brewing Company beer

Plenty of things are more expensive in Alaska, and beer is among them – due in part to being heavily taxed. The state’s excise tax on beer stands at $1.07 per gallon, which is the second highest rate in the country. So, if you’re looking for something to make you feel warm during a cold Alaskan night, beer might not be the most economical choice. Alaskan Brewing Company was the first post-Prohibition brewery to open in Juneau in 1986. While co-founder Marcy Larson was researching brewing before opening up shop, she discovered a beer recipe dating back to the state’s Klondike Gold Rush era. That almost century-old recipe became the brewery’s heralded Alaskan Amber.

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Tennessee has the highest tax rate for beer in the country, a whopping $1.29 per gallon. There’s also an additional $0.15 tax on each case of alcoholic beverages sold in the state. Maybe stick to whiskey?

The Volunteer State continues to feel the legacy of prohibition, with some counties still opting to be dry (such as the one where Jack Daniels is distilled). Statewide, though, liquor laws affecting beer have been loosened over the years, leading to a strong uptick in the number of breweries. 

Nashville is a hotspot for Tennessee’s craft brewery scene. Among the local breweries is Bearded Iris Brewing. Its founders named it after the state’s flower. The brewery boasts a seemingly-endless array of variations on the traditional IPA.