Fourth stimulus check news summary: 24 April 2021
US stimulus checks updates: Saturday 24 April
Huge US stimulus
Mahir Zeynalov, the CEO at Globe Post Media, reminds us of the massive US stimulus response to the pandemic.
"It is larger than the entire economic output of Japan and Germany (3rd and 4th largest economy), almost double the GDP of the UK (5th biggest), France (6th), India (7th) and Italy (8th).
"No country can come even close to compare in government aid," he concludes.
The possibility of another round of stimulus checks has remained in sight after groups of Democrats in both the Senate and the House signed letters calling for the introduction of recurring stimulus checks.
Polls from earlier this year from Quinnipiac University found that the majority of Americans support using federal money to provide stimulus checks, and these calls will only intensify as the pandemic drags on. The new consensus in favour of stimulus check spending could see Biden pushed to do so again if the current provision is not sufficient.
Biden set to announce temporary extension of new Child Tax Credit
The new-look Child Tax Credit included in the American Rescue Plan has not even began distribution yet but lawmakers in Washington are already desperate to extend the programme beyond its initial 12-month lifespan. This would likely become a part of the American Families Plan, the $1.5 trillion package proposed earlier this week.
A report from the Washington Post claims "Biden’s proposal would include a multi-year extension of a provision in the March pandemic-relief legislation that expanded the child tax credit this year to $3,600 for children five and younger and to $3,000 for children six and up"
Stimulus checks christened "Joe-Joe Bucks"
The Washington Post's White House economics reporter Jeff Stein has broke a number of big stories related to the stimulus check payments in the past year, but this one may beat them all. Stein's Washington barber has apparently renamed the direct payments as "Joe-Joe bucks", paying respect to President Biden.
Stimulus checks? Stimmies? Economic Impact Payments? We can now add "Joe-Joe bucks" to the list.
The desire for recurring stimulus checks has been pushed hard by progressives in the Democratic party and in January a group of over 50 Representatives sent a letter to the Biden administration to call for additional direct payments. The letter read: “A one-time payment of $2,000 is simply not enough. The American people are counting on us to deliver transformative change, and we need to meet the moment by delivering monthly payments of $2,000.”
In March, legislation that was presented last year at the beginning of the pandemic was reintroduced in the House by Representatives Pramila Jayapal and Rashida Tlaib. The Automatic BOOST to Communities (ABC) Act would see a fourth stimulus check payment of $2,000, followed by $1,000 monthly payments until the pandemic ends.
Biden will cover stimulus spending with tax increases for high-earners
President Joe Biden is reportedly preparing a series of tax increases for the welathiest Americans to cover federal spending on stimulus checks and Child Tax Credits, amongst other things. The White House is aiming to pass another $4 trillion of stimulus spending, on top of the $1.9 trillion American Rescue Plan passed earlier this year.
The tax increase are only thought to effect those who earn more than $1 million per year.
Biden's approval rating remains high after burst of stimulus spending
Despite entering the White House at a time of intense partisan feeling across the United States, polling seems to suggest that President Biden has done a decent job at winning favour with Republican voters. A recent Gallup poll puts his approval rating at 57%, while the highest that former President Trump managed in their data was 49%.
Biden's prospects may have been helped by the burst of federal spending that has characterised his first 100 days, with over 160 million stimulus checks distributed to the American people. The stimulus checks were resoundingly popular in early-2021 polling and that effect appears to have carried over.
The expanded Child Tax Credit provision was one of the key inclusions in the American Rescue Plan, and one which the White House believes will have real impact on working families. The money will be sent in the form of a monthly direct payment, once the programme is up and running.
At the time of the bill’s passing, the US tax authority, the Internal Revenue Services, was not adequately prepared to send this type of payment. The legislation set July as the deadline for the first checks to be sent, but after a chaotic tax season there are concerns that the IRS may not hit the mark.
Stimulus checks prompt spending increase
Aside from providing immediate relief for those in need, the stimulus checks distributed by the federal government were also designed to reinvigorate the flailing economy by introducing a sizeable cash influx.
Despite early projections suggesting that many intend to save their stimulus check, evidence has shown that the federal spending has had a positive impact on consumer habits with a marked increase on last year.
Stimulus checks used to finance community initiatives
Various community groups are helping people put their stimulus checks to good use by pooling funds to support local projects. Some groups are even using them to create community-funded gardens with which to produce food for the neighbourhood, and are using #1400 to organise their efforts.
One groups, Lobelia Commons, wrote on Twitter: "Plants are powerful, whether we seek to sequester carbon or feed ourselves. They are also easy to share; one plant begets thousands by seeds or cuttings, and the gifted seedling is just the beginning of the conversation... #1400challenge"
Missing a stimulus check payment? You're not the only one
The IRS is sending out weekly batches of $1,400 stimulus check payments and will do so through the end of the year. As the IRS processes 2020 tax returns, they will make corrections to underpayments along with first time payments to individuals who don’t normally file taxes.
This was week 6 of the payments and so far the IRS has sent out around 161 million payments for a total value of more than $379 billion. But there are many eligible Americans who have not yet received the direct payment, with 'plus-up' stimulus checks required to get the full entitlement out to those in need.
Child Tax Credit expansion could be part of $1.5 trillion families' package
President Joe Biden is considering a huge American Families Plan to address some of the deep-seated inequalities in the United States. Included in the proposal is an extension of the new Child Tax Credit, which would make the 12-month programme a permanent one.
The new Child Tax Credit is not expected to be introduced until early July but numerous Democrats in the Senate have called for the new system to be extended. Biden will have to ensure that he keeps the Democratic caucus together in the finely balanced Senate to make sure the new proposal can be passed.
Elizabeth Warren to reintroduce $700 billion universal child care proposal
Massachusetts Senator Elizabeth Warren is set to put forward a proposal for universal child care which promises at least $700 billion over the next 10 years dedicated to modernising the US child care infrastructure.
Warren aims to guarantee universal child care and improve child care workers’ wages, which are on average well below $13 per hour.
Florida farmers using stimulus checks to grow food for their communities
Michael Chaney is one of the instigators of the #1400challenge - an initiative which encourages using stimulus payments to help local communities by pooling resources. Impact payments go towards collective projects such as soundsystems, meshnets, pop-up dwellings, community gyms and growing food locally for the community.
For Chaney, that meant using the stimulus money he received from the government cash to turn his 0.3 acre lawn into a garden plot and community space which he calls New World Growers, vice.com reports.
161 million stimulus checks have now been sent out
The Internal Revenue Service confirmed that approximately 161 million economic impact payments have now been distributed as part of the American Rescue Plan.
On Thursday, the IRS announced that a further two million checks had been sent out in a sixth batch of payments last week. bringing the total value of payments in this third round of aid to over $379 billion. Nearly 700,000 payments, with a value of more than $1.3 billion, went to eligible individuals for whom the IRS previously did not have information to issue an Economic Impact Payment but who recently filed a tax return.
California began sending Golden State Stimulus payments in mid-April and many are still waiting to receive their check.
Check out every AS English article on stimulus checks
In our section devoted to Economic Impact Payments, we have a range of articles providing updates and information on the third round of stimulus checks, and the latest news on a possible fourth check.
We also have info on the Golden State Stimulus payments being distributed to eligible Californians as part of a $9.6bn aid package passed by the state legislature earlier in 2021.
Recovery Rebate Credit: FAQs
If you’re looking to get your missing first or second stimulus check by claiming a Recovery Rebate Credit in your 2020 tax return, you may wish to know that the IRS has a helpful FAQs section on its website, in which you can find the answers to a range of doubts that you might have about the process.
Not only can you claim a Recovery Rebate Credit if you were eligible but didn't receive the first or second stimulus check, but you can also apply for the credit if you didn't get the full amount you were entitled to in either of the two previous rounds of direct payments.
Recovery Rebate Credit: video explainer
The IRS has also produced this video explainer on the Recovery Rebate Credit:
The IRS has been tasked with setting up an online portal for the Child Tax Credit and begin disbursing up to $300 per child in monthly payments by July.
Amid polls showing that many low-income Americans feel they'll need another stimulus check in the near future if they're to maintain their financial well-being, pressure is growing on President Biden to support more direct payments.
The IRS is distributing supplementary stimulus checks, known as 'plus-up' payments, to qualifying Americans.
"I'm begging to be alive in the system": Man misses out on stimulus checks as IRS wrongly thinks he's dead
An Indiana man who is mistakenly registered as dead in IRS files says he has missed out on thousands of dollars in stimulus checks as a result of the administrative error.
Bobby Musgrove says he learned of the error two years ago when the Social Security Administration (SSA) sent him a letter wishing its condolences on his death. Although he has alerted the SSA to the error and received an apology from the body, he has been unable to get his name taken off its Master Death File.
The SSA shares this database with the IRS, leading the US tax agency to consider him deceased.
"That’s a lot of income that I really need," Musgrove told WTHR of a situation that has seen him left out of three separate rounds of stimulus checks amid the coronavirus pandemic.
"I’m begging to be alive in the system and can’t do it.”
The $1,400 direct payments included in the American Rescue Plan were the most generous to date, but many in Congress want recurring stimulus payments offered in the next package.
There are a number of reasons you may receive more unemployment compensation than you were due. Depending on the circumstances you may need to pay it back.
IRS urges people without permanent address, bank account to claim their stimulus check
The IRS says it is in an “ongoing effort” to make people who are experiencing homelessness and/or do not have a bank account aware that they may be able to receive a stimulus check and “other tax benefits”.
So that they can claim their stimulus check, the IRS is urging people in such a situation to file a tax return, which can be done on a smart phone or a computer, as the agency says it “can't issue a payment to eligible Americans when information about them isn't available in the tax agency's systems”.
“The IRS has been continuing to work directly with groups inside and outside the tax community to get information directly to people experiencing homelessness and other groups to help them receive Economic Impact Payments," the body’s commissioner, Chuck Rettig, said.
On their tax return, people without a permanent address “may list the address of a friend, relative or trusted service provider, such as a shelter, drop-in day center or transitional housing program”, the IRS says.
In a statement posted on its website this week, the agency also provided a list of financial institutions that can help people open a “low-cost or no-cost” bank account, and said it may also be able to load money onto a prepaid credit card.
So-called 'plus-up' payments are being distributed to Americans who had already received their third stimulus check but, on the basis of the information provided in their 2020 tax return, are now eligible for a larger check.
When can Californians expect their Golden State Stimulus payment?
California's Franchise Tax Board (FTB) has provided the above breakdown of when eligible Californians can expect to receive their $600 Golden State Stimulus payment, which was approved as part of a $9.6bn coronavirus relief bill passed by the state's legislature in February.
Californian residents' 2020 tax returns are being used to determine their eligibility for the check, so when you get your Golden State Stimulus payment depends on when you filed your return.
"Little change" in how important stimulus checks are to Americans' immediate-term financial state - Bankrate analyst
Although more people have been able to save their third stimulus check than in the first two rounds Bankrate financial analyst Greg McBride has told an interview with Grow Magazine that the number of Americans who still feel they aren’t on a firm financial footing remains high.
According to figures compiled by the US Census Bureau earlier this month, 25% of Americans have been able to save their third stimulus check, compared to 14% in the first round, and 15% in the second round.
However, a poll carried out by Bankrate this month (see below) found that six in 10 Americans felt they’d need another stimulus check within three months to maintain their financial well-being.
“What stood out was how little change we’ve seen through three rounds of stimulus in terms of how many people say this is important to their near-term financial situation,” McBride told Grow Magazine.
McBride also noted, “Monthly bills and day to day essentials continue to be the predominant uses of stimulus funds, just as with the two previous rounds.”
According to the Census Bureau, 48% of Americans have spent their third check on food and 38% have used it to pay bills - down from the first and second rounds, but still the most common ways the direct payment has been used.
Pressure is growing on Joe Biden to include more direct payments in his Build Back Better spending drive, as the US president prepares to unveil his American Families Plan.
But how much could a stimulus check be fourth time around?
Track your third stimulus check
A reminder that you can use the IRS' Get My Payment tool to track your third stimulus check if you're still waiting for the direct payment to reach you.
You can also get help with the tool by visiting the IRS' frequently-asked-questions page.
In its most recent update on the progress of third-stimulus-check payments, the IRS said around 161 million checks had now been distributed to qualifying Americans, and that the agency will continue to send out payments of up to $1,400 per individual "on a weekly basis".
ICYMI: Bankrate poll says most Americans will need another stimulus check within 90 days
This week’s poll by the the Long Island University Steven S. Hornstein Center for Policy, Polling and Analysis (see post below) follows a Bankrate survey that yielded similar results on spending habits, and found that a majority of Americans will need another stimulus check to “sustain their financial well-being” within three months.
According to Bankrate’s poll, which was published on 14 April, just 13% of respondents said they planned to use their third stimulus check for “non-essential spending”, while between 32% and 45% said their direct payments would be going towards “bills”, “day-to-day essentials” or to “pay down debt”.
Asked how long their third stimulus check would last for, 61% said the money would tide them over for no more than 90 days, with 35% revealing the money would last them for either “less than one month” or “not at all”.
Full Bankrate survey: More than 6 in 10 Americans say $1,400 stimulus checks won’t last three full months
Stimulus measures lead hunger in the US to drop sharply in early months of 2021
The Washington Post's Andrew Van Dam has published a report showing that hunger in the United States has undergone a steep fall in the wake of the $900bn coronavirus stimulus package approved at the end of December, and the $1.9tn aid plan signed into law in March.
How are Americans spending their stimulus checks?
According to the results of a new survey carried out by the Long Island University Steven S. Hornstein Center for Policy, Polling and Analysis, third-stimulus-check recipients are chiefly spending their money on day-to-day living expenses.
The poll, published on Wednesday, found that 34% of all respondents said they are using their stimulus check of up to $1,400 per individual to pay for “mortgage, rent, food, car, and credit card expenses”.
Meanwhile, 23% said they have saved their stimulus check, 17% said they had spent their check on "other expenses", 6% responded with an "unsure/no answer", 2% said they had donated it to charity and 17% said they had not received a direct payment.
The poll also asked Americans whether they agreed with the maximum stimulus-check amount, with 47% saying they felt it was not big enough, 38% saying it was just right and 15% saying it should have been smaller.
Read the full report by the Long Island University Hornstein Center National Poll: What Americans Think of the Recovering Economy
President Joe Biden has already stated that he wants to raise the corporate tax rate to help pay for his infrastructure bill taking shape in Congress. Now sources say that he will propose tax increases on the wealthy to pay for his third spending package that will address long-standing inequality.
President Biden will address a joint session of Congress 28 April where he will unveil his American Families Plan, which will focus on social spending for child care, universal pre-K, free community college and paid family leave.
Fourth and fifth stimulus checks would bring 12 million more out of poverty, says recent study
A report by the Economic Security Project (ESP) earlier this month found that the distribution of a fourth stimulus check would keep an additional seven million Americans out of poverty in 2021, while a fourth and fifth check would bring US poverty down by 12 million.
According to the ESP, the stimulus measures included in the President Joe Biden’s $1.9tn coronavirus stimulus plan, which also include the expanded Child Tax Credit and supplemented unemployment benefits, stand to bring the number of people experiencing poverty in the US this year down from 44 million to 28 million.
Another stimulus check would take this figure down to 21 million and two more direct payments would reduce it to 16 million, the body says.
The ESP has also called for the expansion of the Child Tax Credit (CTC) to be made permanent.
“The data make clear that cash has blunted the worst of the recession for millions of Americans,” the ESP says in its report. “But with low-wage workers and communities of color still facing alarmingly high unemployment and difficulty meeting basic needs, we need to make sure the recovery reaches everyone.
“That means getting additional checks now to those still struggling and building a lasting foundation of economic security through future stimulus checks tied to economic conditions – automatic stabilizers.
"It also means making permanent the monthly CTC and EITC [Earned Income Tax Credit] expansions. In that way we can ensure a fast, equitable, and full recovery and sustainable economic growth that benefits all Americans."
Full Economic Security Project report: The Covid Recession and the Year of Checks
The third stimulus check is arriving in the bank accounts of direct-deposit recipients labeled with the identifying reference "IRS TREAS 310 - TAX EIP3", or something similar to that.
Taxpayers without SSN can claim direct payment for dependents with SSN
The IRS is reminding taxpayers without a Social Security number (SSN) that, unlike previous rounds of direct payments, they may be able to claim a $1,400 third-stimulus-check payment for dependents they claim on their tax return who do have an SNN.
Faulty systems and indicators across the US are leaving some unemployment recipients without benefits at the very moment when they need them most.
Eligible Americans have been given a tax break on unemployment benefits as part of President Joe Biden’s coronavirus relief bill.
Under the terms of the $1.9tn package, people in the US who earned under $150,000 in 2020 will not face federal income taxes on the first $10,200 of unemployment benefits paid to them over the course of the year. Normally, the IRS considers jobless benefits as taxable income.
Identifying which state provides the “best” benefits is not an easy question to answer and depends heavily on what one defines as “best.”
We took a look at three factors: size of the benefit, cost of living, and eligibility period to compare benefits across the states.
The likelihood of direct payments being passed by Congress in May is low, but that does not mean that more stimulus checks are out of the question for future legislation.
Another 700,000 'plus-up' stimulus checks in latest payment run
The IRS said this week that it sent out 700,000 more 'plus-up' stimulus-check payments to Americans who had already received their third check, but based on their 2020 tax return now qualify for a larger sum.
US must "end this moral sin" - Booker calls for permanently expanded Child Tax Credit
One of a number of Democratic lawmakers calling on President Joe Biden to make the expanded Child Tax Credit a permanent measure, New Jersey Senator Cory Booker said on Friday that the US has a "moral responsibility to look after our most vulnerable", and says the country's child poverty rate is a "moral sin".
"We must make the expansion of the Child Tax Credit permanent," Booker tweeted.
Earlier this week, Booker was part of a group of Senate Democrats who released a statement saying the US has a "historic opportunity" to reduce child poverty in the US.
“Expansion of the Child Tax Credit is the most significant policy to come out of Washington in generations, and Congress has an historic opportunity to provide a lifeline to the middle class and to cut child poverty in half on a permanent basis," the senators said. "No recovery will be complete unless our tax code provides a sustained pathway to economic prosperity for working families and children. Permanent expansion of CTC will continue to be our priority.”
Biden is understood to support extending the enhanced Child Tax Credit for a number of years - this week, CNBC said until 2025 - but the cost of a permanent extension means it faces stiff opposition from Republicans and moderate Democrats.
Calculating your Child Tax Credit amount
The personal-finance experts at Forbes magazine have created a Child Tax Credit calculator to help parents find out how much they stand to get as part of the scheme, which has been temporarily expanded in President Biden's covid-19 relief package.
Who qualifies for the expanded Child Tax Credit?
Eligible households will receive up to $3,000 over a 12-month period per child aged six to 17, and a maximum of $3,600 per child under six.
Single parents with an annual income of under $75,000 a year, heads of household earning up to $122,500 and joint filers on below $150,000 a year will get the full amount, while there are gradually decreasing payments available for higher earners.
Crucially, the expanded Child Tax Credit is full refundable, meaning that families will qualify for the full figure even if it's more than their annual income-tax bill.
According to the Center on Budget and Policy Priorities, making the Child Tax Credit refundable will see 27 million more children qualify for the payment.
Parents can choose to get their Child Tax Credit as a lump sum when they file taxes next year, or receive the first half of it in monthly payments between July and December 2021.
Passed as part of President Bidens $1.9tn covid-19 stimulus package, the expanded Child Tax Credit gives households with children up to $3,600 per child, with parents able to choose between receiving the money in a lump sum in 2022 or getting the first half of their credit in advance monthly payments of up to $300.
Those opting for monthly instalments are set to begin receiving the Child Tax Credit in July.
Stimulus checks: every AS English article
In our section devoted to stimulus checks, we have a whole host of articles offering updates and info on the third round of checks, and the latest news on a possible fourth direct payment.
There's also news on the stimulus checks being sent out in California as part of the Golden State Stimulus.
Covid-19 relief legislation signed recently in California provides direct payments for low-income residents, but are there limits on receiving both that and the third stimulus check in President Biden's coronavirus aid package?
As part of a $9.6bn stimulus package passed in February, California is sending out $600 direct payments to qualifying residents of the state.
Didn't get the first or second stimulus check despite being eligible? Here's how to claim it
If you were eligible for the first or second stimulus check but didn't get it, you can claim your cash in your 2020 federal tax return. You can get your check by asking for what's called a Recovery Rebate Credit.
Recovery Rebate Credit: video explainer
In the video below, the IRS explains how you can get your Recovery Rebate Credit:
The IRS revealed this week that it had sent out two million more third stimulus checks in its most recent batch of payments, and will continue to send out checks to qualifying Americans "on a weekly basis".
With mounting pressure on President Joe Biden to support further stimulus checks in his Build Back Better plan, how much more money could you be entitled to?
Over 70 Democratic lawmakers now support sending a fourth stimulus check as part of President Joe Biden's Build Back Better spending plans.
US stimulus checks live updates: welcome
Welcome to our live stimulus-checks blog for Saturday 24 April, bringing you the latest news on a possible fourth stimulus check, as well as up-to-date information on the third round of direct payments, which is a part of President Joe Biden's $1.9tn covid-19 relief bill.
We'll also provide info on other measures included in the aid package, such as enhanced unemployment benefits and the expanded Child Tax Credit, which gives households with children up to $3,600 per child dependent.