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The Senate approved President Biden’s $ 1.9 trillion coronavirus relief package on Saturday, directing a third round of stimulus checks on most Americans. This raises questions about when checks might land in bank accounts, especially for those facing loss of employment or income.
The bill will return to the House early next week for final approval, as the Senate and House versions of the relief bill have some differences, and then head to Mr Biden for his signature. Once the bill is signed, the IRS could begin delivering the checks within a few days to a week, depending on the timing of the previous round of checks – potentially as early as the weekend of March 13.
“By next weekend, a couple earning less than $ 160,000 may well have $ 2,800 deposited into their checking account,” Cowen & Co.’s Chris Krueger said in an analyst note before the Senate does not approve the bill, which he says should come in this weekend.
Passage of the spending bill was announced by anti-poverty and unemployment experts, who said the $ 1,400 checks along with other provisions – such as an extension of additional aid to the unemployment of $ 300 per week and an increase in the child tax credit – will help families pay their bills and lift children out of poverty. Almost half of Americans are still having financial difficulties a year after the pandemic, shut down the economy and caused massive layoffs, according to a new study from the Pew Research Center.
“Working families will receive $ 1,400 per person from a third stimulus check, and they will receive a hefty child tax credit of $ 3,000 per child,” noted Andrew Stettner, an expert in unemployment at the Century Foundation, in a statement sent on Saturday. . “This is real aid that can help reverse unprecedented economic inequalities exposed and exacerbated by the pandemic.”
He added, “The federal response to COVID-19 has already averted poverty for millions of Americans, and this package is poised to continue that critical work.”
Applause and cheers
The passage of the bill by the Senate on Saturday was greeted with cheers and applause from Democrats, who all voted in favor. Because GOP Senator Dan Sullivan left due to a family emergency on Friday, Vice President Kamala Harris did not need to come to Capitol Hill to sever ties.
However, fewer Americans may receive checks in the third round of stimulus payments due to a change in the version of the Senate bill. Mr. Biden and moderate Democratic senators reached a deal that limits the number of households eligible for $ 1,400 checks. The revised limits would make millions of Americans ineligible for payment.
The Senate bill directs direct payments of $ 1,400 to people earning up to $ 75,000, but cuts eligibility for singles earning more than $ 80,000. For couples who file a joint federal income tax return, the phase-out begins at those earning $ 150,000 and ends at $ 160,000.
“I wanted the income threshold to be kept at previous levels” – $ 75,000 for singles and $ 150,000 for couples – Oregon Sen. Ron Wyden said on a call to reporters on Wednesday before the vote . “And we have succeeded on this front.”
He added, “I would have preferred what we had earlier, but I don’t want to distract people from the fundamental realization” of maintaining the income thresholds of $ 75,000 and $ 150,000.
Passage before March 14?
Democrats want the bill to be enacted by March 14, when the current additional $ 300 in weekly unemployment assistance will expire. The Senate bill extends the increase of $ 300 until September, unlike the House bill which would increase the increase to $ 400 per week until August.
In addition to the $ 1,400 checks, the bill would provide funding for small businesses, schools, cities and states; provide families with children with tax relief; and increase public spending on COVID-19 testing and contact tracing.
IRS timeline
If the bill is enacted before March 12, which is 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 country. IRS deadline for distributing second round of 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 are watching the hill closely,” said Ken Corbin, the IRS’s taxpayer experience manager, although he did not plan when the tax agency might distribute the checks.
The IRS relies on a taxpayer’s most recent tax return to determine how much they should receive and when they might receive it. This is why some tax experts urge taxpayers to file their returns as soon as possible, especially if they have 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 bill could be enacted in the middle of tax filing season.
If a taxpayer doesn’t file their 2020 tax return before the bill is signed, the agency will likely rely on their 2019 tax return to calculate their stimulus check payment – and that 2019 return could not to reflect the loss of income during the economic crisis of last year. 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 primary determinant of whether they will receive a check, as well as the amount of the payment.
Payments would be $ 1,400 for a single person or $ 2,800 for a married couple filing jointly. Only people earning up to $ 75,000 would receive full payments, as would married couples with incomes not exceeding $ 150,000. Payments would decrease for incomes above these thresholds.
The Senate bill cuts singles with incomes over $ 80,000 and married couples earning over $ 160,000. Under the first stimulus check, the thresholds were higher, at $ 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 checks for $ 1,400 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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