Sacramento, California 2021-02-22 15:11:00 –
(((CBS Detroit) — The third stimulus check, worth $ 1,400, is part of the Biden administration’s $ 1.9 trillion bailout package. The American Rescue Plan, in its original form, to millions of Americans facing the dire financial challenges posed by increased unemployment benefits, improved child tax deductions, and an ongoing COVID-19 pandemic. Also includes additional assistance. Details are currently being launched. These decisions determine how much money actually reaches people’s bank accounts.
Another bailout may be paid in the near future. President Joe Biden and politicians from both parties support giving Americans more money as soon as possible. Republicans have questioned other aspects of the plan, but Democrats dominate both houses and are ready to pass a stimulus bill by party-line voting. Budget adjustments allow them to avoid filibuster in the Senate and pass the stimulus with a simple majority.
Why stimulus checks shrink
The top-line $ 1,400 figure, which has received a lot of attention, seems destined to become a reality. However, the actual amount of money that people reach into their bank accounts can vary based on income thresholds, the number of dependents, and other factors.
The idea of lowering the year Income requirements Collected some steam. In early February, West Virginia Democratic Senator Joe Manchin and Maine Republican Senator Susan Collins Fix “It is intended to cover the payment of financial impact to Americans suffering from the effects of COVID-19, including provisions to ensure that high-income taxpayers are not eligible. . “
The previous two stimulus checks Adjusted gross income (AGI) A couple with an annual AGI of $ 75,000 or more and an AGI of $ 150,000 or more. (AGI is the sum of wages, interest, dividends, severance pay, severance pay distribution, and other sources of income minus certain deductions such as student loan interest, severance pay, and severance pay. For every $ 1 of income above the threshold, payments for the previous two stimuli were reduced by 5%. Therefore, the $ 1,200 payment from the CARES method is reduced to $ 0 for income above $ 99,000 ($ 198,000), and $ 600 from the second stimulus is $ 0 for income above $ 87,000 ($ 174,000). Shrinked to.
Late last week, Treasury Secretary Janet Yellen said Biden said [the next stimulus check is] Target properly and go to those in need. As you know, this is not the case for very high-income people who do not need it. “
To that end, the Biden administration is considering lowering the income threshold to $ 50,000 ($ 100,000). Assuming the same 5% formula applies to the first two checks, a $ 1,400 ($ 2,800) payment is actually $ 64,000 ($ 128,000), $ 700 ($ 1,400), and $ 78,000 a year. ($ 156,000) will be $ 0.
The idea behind this kind of change is to ensure that more money is spent on the wider economy rather than being saved.according to Survey From the Federal Reserve Bank of New York, the average percentage of the first stimulus payments households spent on necessities decreased as income increased. The average percentage of initial stimulus payments saved by households increased as income increased. Lowering income limits will better target the economy, but will also reduce the number of people undergoing a third stimulus check and the amount others receive.
Why Stimulation Checks Grow
Dependent children can also affect the size of the next stimulus check. The second stimulus check included $ 600 per dependent child. Dependent children are defined as those under the age of 17 who live in your household. There was no limit to the number of children. And that $ 600 was added to the adult total for the purpose of phasing out. For example, an adult with two children will receive $ 1,800 in January if the AGI is less than $ 75,000. That amount is reduced to $ 1,200 with an AGI of $ 87,000. $ 600 for an AGI of $ 99,000 and $ 0 for an AGI of $ 111,000.
American rescue plan Expand the pool The group includes college students and the elderly with certain types of disabilities. Such changes could qualify an estimated 13.5 million people for stimulus checks.
The amount of the third stimulus check may also be affected by the recipient’s tax. To speed up distribution, the Internal Revenue Service used the latest tax returns to determine AGI and therefore eligibility. AGI changes from year to year as people receive salary increases, change jobs, and lose their jobs. The first bailout was passed in March 2020. At that point, some have filed their 2019 tax returns, while others have not. Therefore, the check amount may be based on 2018 or 2019 taxes. A second bailout payment was legislated in December 2020 after most people filed their 2019 tax returns. Therefore, the amount was determined by the 2019 tax return.
When can I get a stimulus check?
The third bailout may be signed by early or mid-March 2021. At that point, some will file their tax returns in 2020, while others will not. This means that the third payment may be based on the 2019 or 2020 tax. Last year there was significant unemployment, which often hurt the finances of individual households. Many others have seen their time reduced. If the AGI changes significantly from one tax return to the next, the amount of the next stimulus check may also change.
When will the third stimulus check arrive?The administration’s goal is to sign an American rescue program By March 14th.. It’s also when the current $ 300 federal unemployment bonus expires. Assuming President Biden can sign the bailout package on March 14, direct deposits will begin in the week of March 22 and checks will begin to arrive in the week of March 29.
However, the house seems to be set to go through an American rescue program this week.House Speaker Nancy Pelosi recently repeated her more aggressive timeline, saying the bill could pass. End of February.. The Senate was then able to pass it in a party-line vote next week. Of course, it assumes that Democrats can quickly resolve their differences beyond the $ 15 minimum wage. If so, the stimulus could pass parliament by March 5 and the law could be signed on March 8. Direct deposits will begin to arrive in your bank account by March 15th, and checks will begin to be mailed on March 22nd. For various reasons.
Why you still need a stimulus check
The economy shrank 3.5% in 2020. This is the biggest drop in the year since the end of World War II.Weekly Unemployment rate For the first time last week, 861,000 people took out unemployment insurance, maintaining historically high standards. An additional 516,000 people sought pandemic unemployment support. (There were about 250,000 new unemployment applications in the week before a typical pandemic.) At the end of January, about 18 million people received some kind of unemployment allowance. This is one in nine workers.The official unemployment rate is 6.3%Given all those who dropped out of the workforce, the actual rate is probably close to 10 percent.
Economic recovery relies on widespread distribution of COVID vaccines. However, vaccination efforts for the general public have been slightly delayed. Due to shortages and winter weather, vaccination centers have been temporarily closed in some areas and vaccination has been reduced in recent weeks. Many qualified people are facing problems with their appointment schedules.On the bright side, the federal government has begun distributing vaccines Specific pharmacy Early this month.And Dr. Anthony Fauci, The country’s top infectious disease experts believe that vaccination will be open to anyone by July, when demand no longer exceeds supply. However, wearing a mask and general lack of normality can continue until 2022.Currently domestic COVID case The death toll is approaching 500,000, but over 28 million.
It was originally published on Thursday, February 11, 2021 at 2:46 pm ET.
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