Fourth stimulus check news summary: 18 May 2021
US stimulus checks live updates: Tuesday 18 May 2021
- Biden confirms that the expanded Child Tax Credit monthly payments will begin on 15 July (more info)
- IRS tax return deadline day has now passed (more info)
- Residents of some states have longer to submit state tax returns (more info)
- Speaker Nancy Pelosi calls for Child Tax Credit to be made permanent in statement
- Latest batch of payments sees one million stimulus checks sent to recent tax filers
- California sends out $600/$1,200 stimulus checks as part of the Golden State Stimulus scheme
- California Gov. Gavin Newsom proposes expanding Golden State Stimulus payments program
- Job fears, and price spikes mean heartburn for Biden White House as economy revs up
- IRS paying out unemployment-tax-break refunds (find out more)
- You can track your third stimulus check by using the IRS' online Get My Payment portal
Take a look at some of our related articles:
Depending on the age of your child or dependent at the end of the year will decide how much you can claim on the enhanced Child Tax Credit in 2021.
The tax credit was expanded both in size and age with parents of children who turn 17 in 2021 now eligible to receive up to $3,000. If your child has their 18th birthday before the end of the year you’ll need to settle for a smaller tax credit.
The IRS has sent out around 165 million stimulus payments in the third round of Economic Impact Payments, over six million of them “plus-up” payments worth around $13 billion.
Recurring $2,000 stimulus checks petition surpasses 2.2 million
The change.org petition initiated by Colorado restaurant owner named Stephanie Bonin calling for recurring $2,000 stimulus checks for all Americans until the pandemic is over has crossed the 2.2 million mark. This comes on the heels of six members of the House Ways and Means committee sending a letter to the White House urging President Biden to include recurring stimulus checks in the American Families Plan.
Don’t fall for scammers trying to get your stimulus money
The IRS in their rush to get $1,400 stimulus checks may have mistaken sent two payments for the same person. Like that case there are other situations where a person will have to pay back stimulus money received by mistake. However, the IRS will never call you or use social media to tell you to give the money back. The IRS only contacts people via post to tell you to call them.
Democratic lawmakers continue to call for President Biden to include more stimulus checks in the American Families Plan, so when could they come?
One of the lesser-known provisions of the $1.9 trillion American Rescue Plan was a substantial tax break for recipients of unemployment benefits in 2020, which offers a considerable tax exemption. The IRS is now in the process of sending out tax rebates to over 10 million Americans who incorrectly paid tax on jobless benefits received in 2020.
Around 88% of American children will be covered by the new monthly payments according to the IRS, but some recipients will face restrictions on their entitlement.
Will stimulus end before the economy fully recovers?
In the last recession, an initially fairly robust response petered out too quickly, leading to a decade of stagnation. Officially, the Great Recession ended in June 2009, but it took two years for US gross domestic product to return to its pre-recession level, and six years for unemployment to do so and nearly a decade for wages to rise.
The last recession left many families mired in debt which took year to get out of shaping their financial decisions long after the recession was over.
So far in this recession the response has been $5 trillion in government spending to shore up the economy and household finances and hasn’t stopped yet. Despite a disappointing April jobs report the economy is expected to start looking very strong in the coming months. Will those who shape public policy look at the numbers and say, ‘Mission accomplished’?
Ben Casselman says this time, far more people are paying attention.
Parents should hold onto receipts for childcare expenses in 2021
The American Rescue Plan passed in March included a number of tax benefits for parents with young children or dependents. The expanded Child and Dependent Care Credit will allow up to 50 percent of childcare-related expenses can be claimed. The deduction is capped at $8,000 for one child and $16,000 for two or more children for 2021.
Rental assistance program begins tomorrow in Oregon
Beginning May 19, 2021, qualified renters who have experienced financial hardship due to the coronavirus pandemic, and are at risk of homelessness or housing instability, may apply for the Oregon Emergency Rental Assistance Program (OERAP). This program is not a loan, which means those who receive assistance will not have to pay back funds so long as they are used as approved and not duplicating other assistance programs. Assistance is offered to all eligible renters regardless of their citizenship or immigration status, and it will not impact the recipient’s eligibility for other federally funded programs such as food stamps, Medicaid, Medicare, social security, WIC or public housing.
Renters who are eligible for the program may request rent and/or utility assistance dating back to March 13, 2020 (prior expenses are not eligible). OERAP will cover up to 12 months of past due rent and three months of forward rent, once all past due rent is paid. OERAP will also cover past due utility costs including electricity, gas, home energy services, water, sewer, trash removal, internet and bulk fuels.
Stimulus checks and unemployment benefits give workers a chance to upgrade their job
There have been complaints from businesses looking to hire workers as the nation reopens that stimulus checks and generous unemployment benefits are keeping people from accepting employment. To attract workers some employers are sweetening the offer but many workers remain hesitant. According to government data job openings rose 8% to a record 8.1 million in March but hiring rose less than 4%.
Although the enhanced unemployment benefits and stimulus checks are partly responsible by giving Americans a financial cushion, it's not the whole story. Health concerns and child care responsibilities seem to be the main reasons holding workers back according to Heidi Shierholz, a senior economis with the Economic Policy Institute.
Also many now have the ability to rethink their careers looking to find a better job and one that is better suited to their abilities, precisely what unemployment benefits are designed to do.
Stimulus checks and vaccinations have shoppers returning to stores
Reuters - Walmart Inc on Tuesday raised its full-year earnings forecast after shoppers armed with government stimulus checks ventured back into stores, driving demand that is expected to continue through the year as covid-19 restrictions ease.
Walmart has had a bumper year bolstered by a big push into e-commerce and delivery. While this trend towards shopping online is expected to continue, people are also making their way back to brick-and-mortar stores as vaccinations become more widely available.
Visits to Walmart stores around the country grew by 21.7% in April, according to data firm Placer.ai.
On Friday, Walmart began allowing fully-vaccinated people to shop without wearing masks, making it the first major retailer to walk back its mandatory mask policy.
"My optimism is higher than it was at the beginning of the year," Chief Executive Officer Doug McMillon said on a post-earnings call. "In the US, economic stimulus is clearly having an impact, but we also see encouraging signs that our customers want to get out and shop."
Earlier this year, Walmart also said it would convert two-thirds of its US hourly store roles to full-time positions, while also increasing pay for some of its hourly US workers to an average above $15 an hour.
De Blasio's stimulus spending could leave NYC in budget crunch for years
New York City’s Independent Budget Office projects that more than $4 billion of the city’s federal stimulus money is going to programs designed to continue well after the aid dries up, adding more fuel to criticism of de Blasio’s recent Covid-relief spending spree, the New York Post reports.
The IBO estimates that the coronavirus pandemic has taken a $17 billion chunk out of the city’s tax revenues between 2021 through 2024 — a huge decline that could have an impact on the city’s future finances, the agency warned.
Growing calls for fourth stimulus checks from Dem lawmakers
President Biden has so far refused to comment on the proposed fourth round of stimulus checks, but is facing increased pressure to include additional direct payments in his American Families Plan. The latest to do so are six members of the House Ways and Means committee, who sent a letter to the White House on Monday calling for more stimulus checks.
"The pandemic has served as a stark reminder that families and workers need certainty in a crisis," the letter read. "They deserve to know they can put food on the table and keep a roof over their heads."
Eligibility for the new Child Tax Credit is based on the information provided to the IRS in your most recent tax returns, giving an extra incentive to get your returns filed if you have not already. If you do not submit your tax returns information you may find that your Child Tax Credit payments are delayed, or even that they do not arrive at all.
The White House have estimated that 88% of American children will be covered by the new system which sees up to $300 per child in monthly payments sent to the parents.
Free-to-use Child Tax Credit calculator
Wondering how much the overhauled Child Tax Credit could be worth to you and your family? you may be one of an estimated 39 million households to receive up to $300 per month from the federal government, in the form of a direct deposit straight into your bank account.
But the amount of offer varies, depending on your personal situation and your annual earnings. To find out how much you will receive, check out this Child Tax Credit online tool...
Will there be a fourth stimulus check? That's the question on the lips of millions of Americans at the moment after mixed reports about the White House's thoughts on the direct payments.
In public, White House press secretary Jen Psaki has insisted that the impetus for another round of stimulus checks would have to come from Congress. However the President is reportedly considering introducing a system of automatic payments, which would see stimulus checks sent out when certain economic triggers are met. Here's what we know so far about the rumoured fourth stimulus check...
Stimulus checks used for home improvement
Perhaps it should be no surprise that, after over a year confined at home, many are choosing to use their stimulus check money to make a few changes around the house. A new report has found that Home Depot was one of the main beneficiaries of the most recent round of sitmulus checks, recording a 33% increase compared to the same month last year.
Biden outlines the need for Child Tax Credit expansion
The President used a White House speech on Monday to confirm that the new Child Tax Credit programme was designed to help the struggling middle classes. Biden said the move was "a tax break, to help them with the cost of looking after kids," but in reality the money will come in the form of a monthly direct payment, much like the stimulus checks.
Stimulus spending helps US economy stay afloat
The last 14 months have seen the global economy rocked by the ongoing coronavirus pandemic, destroying the livelihoods of many and bringing some industries grinding to a halt. However the US government has been able to mitigate the short-term damage with a burst of federal spending, from business loans to stimulus checks.
However experts admit that they are uncertain about the long-term impact that such widespread spending will have on the US economy and jobs market.
Jed Kolko, chief economist at job-finding website Indeed, said: “The economy is reopening and restarting in a way that we really have never seen before, and we know that’s not all going to happen in sync.
“The rate at which employers become more eager to hire won’t match exactly the rate at which job seekers are more eager to start working.”
Macy's quarterly report shows stimulus check boost
Department store Macy's have released a report with a considerably more optimistic outlook than previously expected, suggesting that the US' retail sector is rebounding back. The two rounds of stimulus checks distributed in early 2021 have provided consumers with a significant cash injection and that has had an effect on spendind patterns.
Americans appear ready to resume their pre-pandemic shopping habits with non-essential spending on an up. Data from the US Commerce Department found that sales of clothing and clothing accessories were up by 727% in April when compared to a year earlier.
President Biden has confirmed that the overhauled Child Tax Credit programme will begin making payments from 15 July, meeting the original date set in the American Rescue Plan.
In the past the Child Tax Credit had been paid as a single tax refund or tax deduction to be claimed at the end of each year, but this new system will see parents sent a monthly direct payment by the IRS. However, as was the case with the stimulus checks, the amount on offer varies based on both the age of the child and the parents’ household income.
You may need to file to receive a stimulus check payment
Although Tax Day 2021 has now passed, some people may still need to submit documents to the IRS to ensure that they do not miss out on stimulus check payments. The tax authority does not require everyone to submit a tax return, but without that information on file the IRS may not be able to make a stimulus check payment.
If you do not file taxes and are yet to receive any of the three stimulus checks, you may need to submit a tax return to trigger the payment. The IRS' Free File online portal should make the process easy...
If you have recently submitted your federal tax returns with the IRS you could be in line for another stimulus check as the tax authority continues to send out 'plus-up' payments for those who have been underpaid in previous rounds.
Your stimulus check entitlement is based on information provided in your tax returns, such as adjusted gross income, number of dependents and marital status. If you have experienced a change to any of these criteria since your last filing you may now be eligible for more than intitially thought. Last week the IRS made more than one million payments to individuals on the basis of their tax filing, and will continue to send out money until the end of 2021.
Child Tax Credit will benefit nearly 40 million households
The Biden administration has confirmed that the overhauled Child Tax Credit system will be introduced from 15 July onwards, providing monthly direct payments for American families. The monthly payments will gradually phase out for individuals earning more than $75,000 per year, or $150,000 for a married couple.
In total, it is thought that roughly 75 million children will be eligible for the scheme with payments going to 39 million American households.
Less than one in five spent the third stimulus check immediately
A report published by the Peter G. Peterson Foundation found that just 19% of recipients spent the third stimulus check immediately, with many choosing to either save the direct payment or using it to pay off outstanding debts.
The report notes that although spending patterns have changed during the course of the pandemic, wealthier households have always been more likely to save the stimulus check cash.
"While all households were more likely to have spent the first round of payments, higher-income families were more likely to have saved the money—a trend that was more noticeable for the second and third round of payments," says the report.
When will the Child Tax Credit direct payments arrive?
Two months after the American Rescue Plan was signed into law we finally have a fixed date for the new Child Tax Credit programme to begin. In a White House speech on Monday, Biden confirmed that the IRS will begin making the monthly payments from 15 July onwards, meeting the original target that was set in the stimulus bill.
Unlike previous Child Tax Credits, which were distributed as a one-off tax deduction at the end of the year, the new system will see up to $300 per month sent to parents for each eligible child. Initially the provision will only last for one year but Biden's American Families Plan will see that extended to the end of 2025, if passed
Biden makes tax returns public on filing deadline day
In-keeping with a longstanding tradition, President Joe Biden released his tax returns yesterday giving Americans the last 23 years of his earnings and tax information. The move came on Tax Day 2021, the final day for income tax filers to submit their 2020 returns without facing late penalties.
Biden's predecessor, former President Trump, continually refused to release his own tax returns throughout his four-year stint in office. Biden's tax returns show that his annual income dropped considerably in 2020 as he dropped numerous lucrative speaking events to focus on his run for the White House.
Stimulus checks spur record-breaking income increase
It goes without saying that the covid-19 pandemic has had a catastrophic effect on the American economy and on individuals' personal finances. To mediate that damage the federal government has sent out three rounds of stimulus checks, two of which were distributed in the early months of 2021.
This saw up to $2,000 sent to each eligible American and has had a significant impact on personal finances. Research from Cornerstone Macro has found that the stimulus check influx left national disposible personal income level considerably higher than the pre-covid levels, and suggests that a consumer spending boom is on the cards.
How are Americans spending stimulus checks and tax refunds?
The covid-19 stimulus checks were designed to provide immediate relief to struggling households during the pandemic. However not all recipients are spending their federal support in the same way, with many opting to save both the stimulus checks and any tax refunds that they may be due after filing their return.
A new study from Credit Karma, which surveyed more than 1,000 adults in April, found that 47% of Americans are planning to save their refund. More than half of those asked said that the refund would be essential to their short-term financial security.
California stimulus checks are on their way
In addition to the federally-funded direct payments from the IRS, a large proportion of California residents are also in line to receive a Golden State Stimulus check as part of the state's recent relief bill. Gov. Gavin Newsom announced that eligibility for the payment would be expanded beyond the original remit to include roughly two-thirds of Californians.
But to be eligible for the $600 stimulus check you may first need to have submitted your state tax returns, which gives the California Tax Franchise Board the information required to make the payment.
Filing your tax return late if you owe money to the IRS can be an expensive proposition. Not only could you face penalties for filing late but you will also face late payment penalties and interest to boot.
The Internal Revenue Service (IRS) pushed back the filing deadline for a second year in a row due to complications for taxpayers due to the covid-19 pandemic as well as to give extra time to take advantage of the numerous tax provisions created by the American Rescue Plan. Taxpayers had until midnight 17 May to file their return, ask for an extension and pay any taxes they may owe to the IRS.
The Internal Revenue Service (IRS) said that it would start sending tax refunds to those eligible for the $10,200 unemployment tax waiver this week and continue through the summer. Depending on the complexity of your tax return will determine how long you have to wait to see your refund.
Advanced payments will fall on the 15th of every month
The Internal Revenue Service and the US Department of the Treasury announced today that the first monthly payment of the expanded and newly-advanceable Child Tax Credit from the American Rescue Plan will be sent on July 15. Without any further action required, 88% of children in the United States are slated to begin receiving monthly payments. Payments will be made on the 15th of each month unless the 15th falls on a weekend or holiday.
Eligible families will receive a payment of up to $300 per month for each child under age 6 and up to $250 per month for each child age 6 and above. The American Rescue Plan is projected to lift more than five million children out of poverty this year, cutting child poverty by more than half. Additional information for taxpayers on how they can access the Child Tax Credit will be available soon at IRS.gov/childtaxcredit2021.
Child Tax Credit brief explainer
The enhanced Child Tax Credit will see the IRS send monthly payments worth up to $300 for children aged less than six, and $250 for those aged between six and 17. Individuals earning less than $75,000 or married couples earning less than $150,000 will be entitled to the full amounts, with the amount on offer gradually decreasing for higher-income households.
The new system will play a central role in Biden’s effort to tackle income inequality in the United States and is slated to provide support to 39 million households. Speaking to reporters on Monday, Biden said: “This tax cut sends a clear and powerful message to American working families with children. Help is here.”
Tax Day normally comes every 15 April, but again for a second year due to the pandemic and recent adjustments to the tax code to help struggling American households the filing date was pushed back. Taxpayers who owe taxes and haven’t filed their 2020 tax return will face penalties from the IRS.
If you filed your tax return on time and overpaid the government, you’ll be wondering when you can expect your refund.
The IRS says that it usually sends out a refund within 21 days of receiving an online tax return, but this year the agency warns that it is taking longer. Those 2020 tax returns that require review due to claiming incorrect Recovery Rebate Credit amounts, or that used 2019 income to figure the Earned Income Tax Credit (EITC) and Additional Child Tax Credit (ACTC) can expect their refund to be delayed.
US stimulus checks live updates: welcome
Welcome to our live US stimulus-checks blog for Tuesday 18 May. We’ll be bringing you updates on a possible fourth direct payment and updates on the third stimulus check, which the IRS has been distributing since the $1.9tn American Rescue Plan was signed into law in early March.
We'll also provide information on other economic-aid schemes such as the expanded Child Tax Credit, which gives qualifying households up to $3,600 per child per year, and the Golden State Stimulus payments going out in California, where Governor Gavin Newsom has announced plans include more residents of the state in the program.