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Watch Out! Debt Collectors Can Take Your 3rd Stimulus Check. What Can You Do?

The third round of stimulus checks for COVID-19 relief started going out this past weekend after the bill was signed on March 11th

But will you see that precious #StimmyCheck? If you have debt in collections, your check might disappear before you even realize it ever hit your account. Keep reading to learn the latest updates.

How can debt collectors take stimulus check payments?

Debt collectors may be able to take your stimulus check depending on the type of debt you have.

While the last stimulus check was protected from garnishment by debt collectors, the 2021 Economic Impact Payment (3rd stimulus check) doesn’t have the same protections.

Unfortunately, this lack of protection could severely impact those who need it most. There are ongoing efforts to close this loophole — letters to Congress members and offices — but for now, those who may be impacted should prepare.

Is your #stimmy at risk? Here’s what to do.

Your stimulus money isn’t at risk of being taken to pay back taxes, child support, or government debts. But private debt collectors are not explicitly exempt from going after your stimmy as soon as it hits your bank account — so what can you do?

1. Pay your bills early

Start checking for your stimulus payment to hit your bank account over the next few weeks. Track your payment on the Get My Payment tool. Chances are, debt collectors will act fast — you’ll have to be diligent if you need to prioritize your spending to pay for rent, food, or other bills just in case.

However, if you are able to pay your debts, you should do that — otherwise, you are only hurting your credit score and racking up interest payments, which will cost you more money in the long run.

Break up with your debt just like Noah did.

2. Settle your debts as soon as you can!

Large amounts of debt, like loan debt or credit card debt, can be a huge distraction in these trying times. If you’re able to, we’d recommend you make a substantial payment towards your debt with this stimulus check.

While there’s a lot to consider, your #StimmyCheck can be a catalyst to help you get back on your feet!

Relieving yourself from the debt of stress is rewarding, and you don’t need to be a financial expert to get back on your feet. Reach out to a C&D financial coach, or look into debt relief solutions or credit building tactics.

3. Close your bank account

If your check hasn’t hit your account yet but it’s scheduled for direct deposit, you could close your bank account. This would cause the IRS to send your check via snail mail, which prevents it from being garnished. If you take this route, then you’re likely looking at a delay in your payment arrival so, that’s something to consider as well. 

Understanding the 2021 Economic Impact Payments

Stimulus checks will pay out $1,400 to individual taxpayers that earn under $75,000 annually, and $2,800 for joint filers making up to $150,000 annually — plus an additional $1,400 for every dependent, contingent on the following:

  • 2019 Taxes (if you have filed for 2020 already, they’ll use that one)
  • 2020 Taxes (if you haven’t filed this year’s return yet, they’ll look at 2019 taxes, and make up for the difference in this year’s tax return)
  • Number of dependants
  • Amount you received in 1st and 2nd stimulus payments (read more about the Recovery Rebate Credit)
  • Your income level (phased out)
    • If you make more than $75,000 individually, but less than $80,000 individually, or more than $150,000 jointly, but less than $160,000 jointly, you may still be eligible for a “phased out” stimulus check.

For the latest updates on the third stimulus check and the 2021 Economic Impact Payments, visit the Get My Payment page on

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