Fourth Stimulus Check: Are More Payments Coming
A fourth stimulus check from the government could take one of two forms: monthly checks in fairly small amounts, or one-time payments of up to $2,000.
Both options have been put forward by legislators in Congress as follow-ups to the third round of pandemic relief payments, which were made possible by the American Rescue Plan Act of March 2021.
The federal moratorium on evictions ended Aug. 26 with a Supreme Court ruling, and millions now face losing their homes. Inflation, however, appears to be on the rise, contributing to fears among economists and lawmakers that further stimulus payments could only fuel more price hikes.
As a result, there’s no legislation in Congress that’s likely to pass that would create a fourth round of stimulus payments, even though some Democratic lawmakers have called on President Joe Biden to consider recurring payments.
The White House has passed back the buck, stating that the president would consider whatever Congress comes up with.
At the end of July, Rep. Ilhan Omar , introduced a bill that would send $1,200 to each American making less than $75,000 per year, forever. But it has not moved forward in the House of Representatives and has little chance of passing.
Your Bank Account Number
When you file your taxes, make sure you use your current banking information if you would like your payment through direct deposit.
Typically, you’ll receive this payment using the refund option you select on your tax return. If you received an advanced refund through your tax service provider or paid your tax preparation fees using your refund, you’ll receive your payment by check in the mail.
How Much Would A Child Tax Credit Extension Cost
As it stands, the expanded Child Tax Credit is set to expire next year and revert back to the old system of a single, annual tax credit. Democrats are desperate to see it extended beyond that initial period but will almost certainly have to pass a reconciliation package to do so.
Congress is set to vote on a massive $3.5 trillion reconciliation proposal later this month which would provide funding for the Child Tax Credit, alongside myriad other social and infrastructure programmes. Here’s how that cost compares to the US’ military spending.
Read Also: Update On Ssi Third Stimulus Check
What About People With Itins
You still need a work-authorizing Social Security Number to be eligible for this stimulus. However, there are important changes since the first round of stimulus checks.
- In the first stimulus rollout, any non-SSN holder on a joint return made everyone on that return ineligible. Big change: The new rounds of stimulus has corrected this problem. If you filed a joint return with a non-SSN holder, you are still eligible for the stimulus. See the below hypotheticals.
- Situation: A single tax filer has an Individual Taxpayer Identification Number but no Social Security number .
- This person is ineligible for the stimulus.
Increase In The Maximum Amount Of Expenses Eligible To Be Used In The Calculation Of The Child And Dependent Care Tax Credit For 2021
Prior to the changes that the American Rescue Plan will make for 2021, the regular Child and Dependent Care Tax Credit has been calculated using a maximum of $3,000 of expenses when the taxpayer has one qualifying child and $6,000 of expenses when the taxpayer has two or more qualifying children. Qualifying children are those children who are under the age of 13 for the entire year.
The Child and Dependent Care Tax Credit may also be claimed by taxpayers who have a spouse, or other dependents, who are physically or mentally incapable of caring for themselves, provided those individuals live with the taxpayer for more than half of the year.
Under the American Rescue Plan, the maximum amount of expenses eligible to be used in the calculation of the Child and Dependent Care Tax Credit is more than doubled in 2021, to $8,000 of expenses when a taxpayer has one qualifying child and $16,000 of expenses when a taxpayer has two or more qualifying children!
Read Also: When Does Third Stimulus Check Come
Back Taxes Child Support And Other Debts
Question: Can the IRS or other creditors take my third stimulus check if I owe back taxes, child support or other debts?
Answer: Your third stimulus check is not subject to reduction or offset to pay child support, federal taxes, state income taxes, debts owed to federal agencies, or unemployment compensation debts.
However, the American Rescue Plan doesn’t include additional protections that were included in the legislation authorizing the second round of stimulus checks. For example, second-round stimulus checks weren’t subject to garnishment by creditors or debt collectors. They couldn’t be lost in bankruptcy proceedings, either. The IRS also had to encode direct deposit payments so that banks knew they couldn’t be garnished.
Question: Can a dead person get a third stimulus check?
Answer: For the third round of stimulus checks, anyone who died before January 1, 2021, is not eligible to receive a payment. Essentially, they’re treated as if they don’t have a Social Security number.
There is an exception for military personnel. If a person who died before 2021 was married and a member of the U.S. military, the surviving spouse can still receive a third stimulus check even if he or she doesn’t have a Social Security number.
The extra $1,400 per dependent is also off the table if the parent died before 2021 or, in the case of a joint return, both parents died before then.
Question: Will I receive a notice from the IRS about my payment?
Why Is The White House Planning For A Government Shutdown
Congress has less than five days to pass a spending bill or a government shutdown will be triggered
The United States federal government is an enormous bureaucracy that makes shutting down, a logistical nightmare. To prepare for a possible shutdown, the White House Office of Management and Budget periodically instructs agencies to write up contingency plans in case of a shutdown. Many of these agencies have updated their plans recently, because of the shutdown that occurred in 2018-2019.
Read our full coverage for more details on these plans and for information on which workers are repaid after a shutdown.
Despite remaining around pandemic lows, initial unemployment claims rose slightly by 16,000 to 351,000 last week. The four-week rolling average declined slightly, which counters the large week-by-week changes.
The claims rise comes as the extra unemployment benefits ended on Labor Day on September 6. A part of this was the extra $300 weekly payment and expansion to the number of weeks unemployed people can claim benefits. With this gone, many long term unemployed are now eligible for very little support.
, Head of the Salvation Army
Also Check: Where Is Stimulus Check 3
Whats Not Included In The American Rescue Plan Act
While the American Rescue Plan Act is packed full of important changes of which advisors and clients must be aware, questions will inevitably arise as to what did not make it into the final version of the law.
While there are an infinite number of things that are not included in the final version of the American Rescue Plan Act, the following is a brief rundown of some of the most notable non-inclusions:
Whats Next For Gas Stimulus Checks
Even with all these measures making their way through various legislatures, Americans remain crunched between what they need and what they can afford.
And while rebates and gas stimulus checks can help buffer the blow of rising prices, there are those who remain leery of sending out additional payments, especially with past pandemic relief programs believed to have contributed to our current rate of inflation.
Dr. Jaime Peters, assistant dean and assistant professor of finance at Maryville University explains that for some lawmakers, inflation-related stimulus payments will simply feed the beast, putting even more money into the market where the supply of goods cant meet demand.
This creates a conundrum for families who are coming up short on the supply of funds to get the goods they need each day.
Recommended Reading: Stimulus Check 2 Status Not Available
Checkpoint : The Additional Payment Determination Date
For many taxpayers who have yet to file their 2020 tax returns, their AGI in 2020 may be significantly less than their AGI from 2019 . This reduction in AGI would potentially allow them to receive a 2021 Recovery Rebate, which will be determined once their 2020 tax returns have been filed. Accordingly, the American Rescue Plan introduces something called the Additional Payment Determination Date.
In short , individuals filing their 2020 tax return prior to the Additional Payment Determination Date will have their Recovery Rebate amount recalculated based on the newly reported 2020 AGI. And if using 2020 AGI produces a higher Recovery Rebate compared to the amount initially calculated using 2019s AGI, the IRS will send an additional stimulus check to the taxpayer after filing their 2020 return to true up the difference in the appropriate 2021 Recovery Rebate.
Per the American Rescue Plan, the Additional Payment Determination Date is the earlier of:
- 90 days after the 2020 calendar year filing deadline or
Advisors should pay particularly close attention to clients who had temporarily low incomes in 2020. For instance, some low-earning clients may have been temporarily out of work or had hours reduced due to the pandemic that have now been restored. Business-owner clients may have seen dramatic decreases in profits for 2020, which are now largely expected to recover for 2021.
Retail Sales Unexpectedly Rise In August
US retail sales unexpectedly increased in August, likely boosted by back-to-school shopping and child tax credit payments from the government, which could temper expectations for a sharp slowdown in economic growth in the third quarter.
Retail sales rose 0.7% last month, the Commerce Department said on Thursday. Data for July was revised down to show retail sales declining 1.8% instead of 1.1% as previously reported.
Economists polled by Reuters had forecast retail sales dropping 0.8%. Retail sales rebounded despite an ongoing global shortage of microchips, which is forcing automakers to cut production, leading to a scarcity of inventory at showrooms.
The semiconductor crunch, which has been worsened by the latest wave of infections driven by the Delta variant of the coronavirus, primarily in Southeast Asia, is also causing shortages of some electronic goods. Congestion at ports in China is also adding to the supply bottlenecks.
Retail sales are holding up even as spending is shifting back from goods to services like travel and entertainment, though soaring covid-19 infections are likely delaying the services spending boom.
Read Also: Will We Get The $2000 Stimulus Check
American Rescue Plan Enhancements To Unemployment Compensation
As those who followed the American Rescue Plans legislative journey through Congress will recall, the single most debated aspect of the bill was its provisions related to unemployment compensation.
Interestingly, the House-approved unemployment compensation-related provisions were significantly scaled-back by an amendment introduced by Rob Portman , after Joe Manchin backed the proposal, along with all 49 Senate Republicans only to be re-expanded later the same day, after all 50 Senate Democrats, including Joe Manchin supported another amendment, introduced by Ron Wyden .
Ultimately, the final provisions of the American Rescue Plan extend many of the benefits that have been in place since the passing of the CARES Act last March, as well as designate up to $10,200 of unemployment compensation received in 2020 tax-free.
More specifically, the following Federally subsidized unemployment compensation benefits have been extended:
In addition to the unemployment-compensation-related programs described above, the American Rescue Plan also extends a full Federal reimbursement for the first week of Unemployment Compensation benefits for states with no elimination period and a 50% subsidy for certain temporary short-time compensation programs .
Various Petitions Urging Congress To Send Stimulus Checks To Us Households Are Gaining Momentum
One that calls on Congress to send monthly checks worth $2,000 until the end of the crisis nears 3 million signatures. Another started by the Senior Citizens League which asks that a $1,400 check be sent to Social Security recipients has surpassed one million.
You May Like: Stimulus Check 3 Social Security
$35tr Spending Package Economic And National Security Benefits
EPA Administrator Michael Regan argues that through the Democrats $3.5 trillion spending proposal will make the US more competitive and save the nation money down the road. By making US infrastructure more resilient to the effects of climate change now the nation will be saving itself more costly expenses in the future.
How Will The Democrats Pay For The Reconciliation Bill
With a bumper month in Congress to sort the infrastructure and reconciliation bills, much of the discussion has turned to how the Democrats plan to fund their trillion dollar agenda.
Progressives have been upset at the apparent watering-down of proposed tax hikes on the wealthy. The Ways and Means Committee would raise the corporate tax rate for income above $5 million from 21% to 26.5%, while Biden had called for a 28% corporate tax rate.
It remains to be seen how the tax proposals change as the spending package moves through Congress. Nearly every House Democrat, and every Senate Democrat, will need to vote for the spending bill for it to pass, meaning small groups of lawmakers have the ability to influence the legislation.
The next Child Tax Credit payment is due to be sent on September 15, a mere two days away. After this payment, there are still three more due before the end of 2021.
The last six months will be all grouped together and received at the end of the tax year in 2022.
On paper, the poor August jobs report does not make sense considering the millions of jobs available, but the answers point to varied reasons.
You May Like: Track My Stimulus Check 3
Is Representative Payee Monitoring Continuing
Date: October 9, 2020
Yes. State Protection and Advocacy networks will conduct new representative payee monitoring reviews in-person only when state and local conditions permit and reviews can be conducted safely while social distancing with personal protective equipment . Reviews may also be conducted by video and phone. P& A grantees will comply with the Centers for Disease Control and Preventions social distancing guidelines.
More Than Half The Year
Just because someone lived with you for six months does not mean that the person lived with you for more than half the year. A year has 365 days, and more than half the year is 183 days.
To determine how many days your home was your qualifying personÃ¢â¬â¢s main home, follow these guidelines:
- If you were not married and not an RDP at any time during the year, count all of the days that your qualifying person lived with you in your home.
- If you were at any time during the year and received a final decree of divorce, legal separation, or your registered domestic partnership was legally terminated by the last day of the year, add together:
- Half the number of days that you, your spouse/RDP, and your qualifying person lived together in your home.
- All of the days that you and your qualifying person lived together in your home without your spouse/RDP .
You May Like: Status Of My Stimulus Check
No Economic Recovery For Others
The pandemic has further highlighted the growing imbalance across the broader economy. While many households have financially flourished during COVID, many others have fallen behind where they were in early 2020. Much of the gap depends on whether wage earners could work remotely during the shutdown or had public-facing jobs that required them to be on-site.
Financial insecurity is still widespread, and the loss of a job and the loss of hours have been some of the main reasons over the course of the pandemic. Nine percent of American adults reported a shortage of food in their household over the previous week, according to a Center on Budget and Policy Priorities analysis of U.S. Census survey data from late August. Approximately 15 percent of renters have fallen behind on their rent, including 22 percent of renters with children in their household. The federal eviction moratorium, which has been extended until October 3, doesnt forgive rent that is owed, it pushes the debt into the future. And evictions continue in some parts of the country regardless. Meanwhile, only a fraction of the $46 billion Congress allocated for rental assistance has actually made it to tenants and landlords. As of late August, over a quarter of American adults reported some difficulty keeping up with expenses in the prior week.