Third stimulus check: what is the maximum annual earnings to qualify for a payment?
The House Ways and Means committee put forward their proposal for covid-19 relief, including $1,400 stimulus checks and who would be getting them.
Richard Neal, Chairman of the House Ways and Means Committee, is confident that the coronavirus relief package Congress is currently writing will be passed by mid-March. Neal said at a press conference on Monday that his committee will begin hammering out the details of their half of the proposed $1.9 trillion covid-19 relief bill on Wednesday, hopefully wrapping up by Friday.
The Ways and Means $941 billion portion of the relief bill includes expanded tax credits, extended unemployment insurance and the $1,400 direct payment for a third round of stimulus. After much debate over the past couple weeks about lowering the threshold for eligibility, the House will move forward on legislation that would see the same thresholds as the previous two payments.
What is the proposed threshold to get a $1,400 stimulus check?
In the previous two rounds of direct payments sent out in the CARES Act in the spring and the covid-19 relief bill passed in December, Congress set the limit for receiving the full payment at $75,000 and $150,000 annual adjusted gross income (AGI) for individuals and couples respectively. There had been discussion about targeting the payments, possibly reducing the cap for receiving the full amount to $50,000. In a plan presented by Republicans the cap was put at $40,000 with a trimmed down check.
The proposal Neal presented on Monday, based on the outline of President Biden's American Rescue Plan, will send the full $1,400 stimulus payment according to the same guidelines as the previous payments. So individuals earning $75,000 or less, couples making $150,000 and Head of Households with a $112,500 annual adjusted gross income (AGI) could expect the full payment once the bill is enacted.
Above that threshold the amount that individuals receive will phase out by $5 for every $100 over the cap. This means that a person earning $100,000, a couple making jointly $200,000 and a Head of Household earning $150,000 would not be eligible for a payment under the proposal.
The final details of House version of the bill will be worked out this week and next, so the limits may yet change. Also the bill needs to pass through the Senate where the Democrats need all 50 of their members to vote in favor of the bill. There are opposing forces in the Democratic caucus, most notably Senators Joe Manchin and Bernie Sanders. Manchin would like to target the checks to those who need the money the most, while Sanders sees the $50,000 ceiling as too low. As for the President, Neal said Biden is “open to some negotiating on the ceilings.”
Adult dependents are now eligible for $1,400 stimulus check
One key change in the new round of direct payments is that adult dependents will now be eligible. This group includes college students, disabled adults and older dependents. Roughly 13.5 million adult dependents were left out of the previous rounds of stimulus checks according to an analysis. Only child dependents 16 or younger qualified. This means many struggling families can look forward to receiving a little extra help.
Democrats aiming for second or third week of March
Democrats, with control of both chambers, are working quickly to pass the bill through both the House and Senate. Neal said that Speaker of the House Nancy Pelosi had assured him the bill will pass the lower chamber.
Although congressional Democrats and the White House would like to pass the covid-19 relief bill with bipartisan support they don’t want to get bogged down in lengthy negotiations. To smooth the passage of the bill, both chambers passed budget reconciliation bills. Using that budgetary tool, the final draft can be passed in the Senate with a simple 50-vote majority, with Vice President Kamala Harris casting the tiebreaking vote.
Speaking about discussions with the White House at the press conference on Monday Neal said “Our timeline is tight.” Adding “The President was fully engaged on these matters on Friday morning — two hours, we went back and forth with him on filling in the details, as I’ve described them, and the Speaker has made it clear that this is going to be done by mid-March.”
“Economists left, right and center would all agree with what I’ve just asserted: people are struggling. We need to hear their calls for help.”
Third stimulus check: live updates
You can get the latest updates on the proposed third stimulus check, and other mooted aid measures such as the expanded child tax credit, by following our dedicated live blog.