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President Joe Biden’s $ 1.9 trillion coronavirus relief plan is moving forward, raising hopes of another round of stimulus checks for most Americans. The House passed the bill early Saturday.
After that, the Senate is likely to resume the spending package, dubbed the US bailout, in the first week of March, although some wrinkles have appeared during the negotiations. The biggest problem is a provision in the House measure that would raise the federal minimum wage to $ 15 an hour by 2025. The Senate bill is unlikely to include the increase after the A Senate parliamentarian ruled on Thursday that the salary increase cannot be included in the upper chamber version of the back-up plan.
This means that the House will vote on a version that includes the increase in the minimum wage, unlike Senate legislation. Because of this discrepancy, the House will have to vote on the bill again after the Senate passes it, according to Hunter Hammond, an analyst at Heights Security.
Still, if the loss of the pay rise is a blow to low-income workers, its withdrawal from Senate negotiations could actually speed up the bill’s passage, analysts say.
“This move, while disappointing for progressives, makes calculating the passage of the bill much easier for Democrats,” Hammond told investors in a research note. “They will avoid an uphill battle in the Senate, where two Democratic senators oppose a raise to $ 15 / hour (although at least one of them has said he could support a smaller increase), which means that the party could have been the subject of a brutal internal. fight on the subject. “
The bill would also increase weekly unemployment benefits from $ 300 to $ 400; providing financing to small businesses, schools, cities and states; offer families with children tax relief; and increase public spending on COVID-19 testing and contact tracing.
The Senate could vote on the package at the end of next week, with the House then proceeding to its final vote on the weekend of March 6 or the week of March 8, according to Hammond. Lawmakers are seeking to pass the bill by March 14, when expanded unemployment assistance of $ 300 per week will expire.
Certainly, disputes or disagreements could still derail the bill. But Democrats are using a process called budget reconciliation to pass the legislation, which means only a simple Senate majority is required for approval, rather than the 60 votes required by most bills to overcome a possible filibuster. In other words, Democrats don’t need the support of Republican senators to pass the bailout.
IRS timeline
If the bill passes before March 12, the Friday before the extra unemployment assistance expires, stimulus checks could start hitting bank accounts a few days to a week after that, depending on the time frame. from the IRS for the distribution of the second round. stimulus checks in December.
Earlier this month, the IRS said it was monitoring the relief bill to prepare to distribute the next round of payments. “We’re watching the hill closely,” said Ken Corbin, the IRS’s taxpayer experience manager, though he didn’t plan when the tax agency might distribute the checks.
The IRS relies on a taxpayer’s last tax return to determine how much they should receive and when they might receive it. This is why some tax experts are urging taxpayers to file their returns as soon as possible, especially if they’ve had a major life change, such as the birth of a child or the loss of a job or income last year.
Because the IRS officially began accepting tax returns on February 12 and will close the filing window on its usual April 15 date, the plan could pass in the middle of the tax filing season.
If a taxpayer does not file their 2020 tax return before Congress passes their next relief bill, the agency will likely use their 2019 tax return to calculate their check payment. stimulus – and this 2019 statement may not reflect the revenue losses during last year’s economic crisis. or a new child, for example. In this case, a taxpayer might not receive as much stimulus money as they are entitled to.
Income Limits
A person’s income is the main determinant of whether they will receive a check, as well as the amount of the payment.
Like the two previous stimulus checks, the payments would be $ 1,400 for a single person or $ 2,800 for a married couple filing jointly. But only those earning up to $ 75,000 would receive the full payment, as would married couples with incomes of no more than $ 150,000. Payments would decrease for incomes above these thresholds, gradually rising above $ 100,000 for individuals and $ 200,000 for married couples.
Some lawmakers have argued that checks should be targeted at low-income families, citing research that shows high-income families are recovering from the economic impact of the pandemic. But other research points to widespread financial pain across the country, with the ranks of adults struggling financially last month little changed from December, according to Morning Consult economist John Leer.
A third set of $ 1,400 checks would allow nearly 23 million adults to pay their expenses for more than four months without taking on more debt or eating into their savings, according to his analysis.
“This third stimulus check is absolutely vital,” Colleen McCreary, director of human resources for Credit Karma, told CBS MoneyWatch. “I don’t see a world where people will have their financial footing without additional stimulus funding.”
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