New $1,400 stimulus checks could be on their way to millions of Americans as the House of Representatives passes the latest coronavirus relief law.
The fate of those payments now rests in the hands of the Senate, which will begin considering the proposed legislation this week.
The terms have called for immediate payments of $1,400 per person and per dependent.
The payments would be based on the same income thresholds as the first two stimulus checks. Individuals with up to $75,000 in adjusted gross income, householders with up to $112,500, and married couples filing jointly with up to $150,000 would receive full payments.
But the checks would be phased out for those with incomes above those levels. This time, they would be capped for individuals making $100,000, householders at $150,000, and married couples at $200,000.
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The coronavirus stimulus package is working its way through the House and Senate in the context of budget alignment. That process is likely to prevent major changes to the plan, although the final numbers may be subject to change.
“There will be pushbacks and efforts will be made to reduce the size of the package,” Bill Hoagland, senior vice president of the Bipartisan Policy Center, said of upcoming Senate negotiations.
Republicans are expected to disagree with the total spending of $1.9 trillion, particularly on state funding, multi-employer pensions and aid not directly related to the Covid-19 pandemic. he said. (In fact, the House version went from 219 to 210, without any Republican support.)
Because the $1,400 stimulus checks are one-time payments, they probably won’t become a sticking point in negotiations, Hoagland said.
Expected payment term of $1,400
The legislation is expected to become final in mid-March, when the increased federal unemployment benefits expire.
As with the first two stimulus checks, the bulk of payments will likely be sent via direct deposit to those who have already registered their banking information with the IRS. According to Garrett Watson, senior policy analyst at the Tax Foundation, based on the latest $600 checks, that money could come in within two weeks of the legislation being finalized.
The rest of the direct payments go through the post, either as a debit card or a cheque. Those payments could take longer, possibly in April and May, Watson said.
One of the reasons payments could be delayed this time around is the fact that the IRS is in the middle of tax season when they go out, he said.
However, experience with previous payments can help make the process smoother.
“The good news is there’s a little more infrastructure and a more formalized process to do this than at this time last year because they’ve been through it twice,” Watson said.
This time, the checks are based on the 2019 or 2020 returns.
The IRS has said it has sent out all “legally permitted” first and second stimulus checks and is now focusing on tax filing season.
The IRS sent more than 160 million $1,200 stimulus checks, totaling more than $270 billion. It has also sent more than $147 million in direct payments, for a total of more than $142 billion.
Note that people who qualify, but who have not received previous payments, can claim the money through a chargeback credit on their tax return.
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