Fourth stimulus check summary: 8 June 2021
US stimulus checks latest news live: Tuesday 8 June 2021
- White House cool on possibility of fourth stimulus check in immediate future (full story)
- Monthly payments as part of new, expanded Child Tax Credit due to begin on 15 July
- May jobs report falls short of expectations (how does this affect the prospects of another stimulus check?)
- Study shows that American households significantly helped by stimulus checks (find out more)
- Return-to-work bonuses on offer in some American states (full details)
- Many states halting supplementary unemployment insurance early (full story)
- California Comeback Plan aims to send Golden State Stimulus checks to more residents of the state
- First responders and teachers in Florida set to receive $1,000 stimulus check
- Petitions for recurring $2,000 stimulus checks pick up over 2.6m signatures
- You can track your third stimulus check by using the IRS' online Get My Payment tool
- Check out all the latest news and information on vaccines (live blog)
Have a read of some of our related news articles:
U.S. President Joe Biden addresses the Select USA Investment Summit
The US President spoke at the key investment summit along with Secretary if State Blinken and key US governers
Dollar teeters as inflation test looms
The dollar clung to a small bounce on Wednesday as traders looked to upcoming U.S. inflation data and a European Central Bank (ECB) meeting to gauge the global recovery and policymakers' thinking.
Investors have piled up bets against the dollar, but are growing nervous about whether the beginning of the end of enormous monetary stimulus is nigh - and worry that interest rate rises could end a 15-month dollar downtrend.
Some think tapering could be hastened, and the dollar boosted, if U.S. inflation runs hotter than the 0.4% monthly clip that economists expect. For the ECB, the focus is on any signs of an imminent slowdown to its bond buying programme.
Both are due on Thursday and the anticipation has all but killed volatility in major currencies, as traders assume a wait-and-see stance. The euro was steady at $1.2174 early in the Asia session, while the dollar held firm at 109.42 Japanese yen.
IRS advice for late filers
The tax deadline of 17 May was some weeks back with the Internal Revenue Service offering advice for those individuals who may have missed the date to file theur annual tax return.
The prospect of the fourth stimulus check has been around for months now, as President Biden looks to negotiate the next stages of his three-step Build Back Better legislative agenda. However he has remained fairly quiet on the likelihood of another direct payment recently.
However Jen Psaki, the White House press secretary and typically the mouthpiece of the Biden administration, has been more willing to talk. Last Thursday she was asked by reporters if the President is considering introducing another round of stimulus checks into future relief legislation.
IRS Commissioner praises stimulus check payments
Chuck Rettig has had a particularly busy last 18 months as head of the IRS, which has seen the tax authority distribute three rounds of stimulus checks, oversee a busy tax season and implement the new Child Tax Credit system.
In a meeting of the Senate Finance Committee earlier today, Rettig praised the positive impact that the stimulus checks had had on recipients. He also, uncharacteristically, used the informal term "stimmies" to refer to the Economic Impact Payments that have proved so popular.
IRS releases Child Tax Credit payment schedule
The new-look Child Tax Credit is scheduled to commence from 15 July, providing a monthly direct payment to tens of millions of American families. The new system is a significant change that is expected to halve the number of children in poverty, and is unlike anything in US history.
As such many are unsure about what to expect from the new Child Tax Credit. Fortunately, the IRS have provided a schedule for the payments...
Biden ends infrastrucutre talks with GOP leaders
In recent weeks President BIden has been searching for a bipartisan compromise with Republican leaders in Congress for his proposed American Jobs Plan. The massive infrastructure proposal does not include the fourth stimulus check that many had hoped for, but intitially contained roughly $2.25 trillion of federal investment in the American economy and society.
Biden is now expected to move on to talks with a select group of more moderate GOP lawmakers, but is thought to be willing to pass the legislation using reconciliation if required, as he did with the previous stimulus bill.
Researchers at the University of Michigan have studied the impact that the three stimulus checks sent by Congress have had on American society, and found that they have been enormous useful in a variety of metrics. The data used to complete the study comes from the US Census Bureau “Household Pulse Survey (HPS).”
The HPS began in April 2020 and the results cover a two week period with a two day gap between releases. The survey asks millions of US residents the same set of questions and garnered some interesting findings on their access to food and healthcare, depression and anxiety, ability to make rent and mortgage payments, and more.
How many people will get an unemploymen benefits tax refund?
The American Rescue Plan introduced a new pandemic-era tax exemption for anyone who received unemployment benefits during 2020. For last year, the first $10,200 of jobless support received will not be subject to tax.
However the legislation was only passed in March this year, by which time millions had already filed their returns and paid the taxes they thought were due. The IRS has now identified roughly 13 million filers who are owed a tax refund, and around three million of those payments have gone out in the past week.
While the wait continues for a fourth stimulus check, those that own a home and have fallen behind on their mortgage or utilities might be able to access other funds from the stimulus bill passed in March.
Unlike previous rounds of stimulus checks, which were largely distributed without any steps needing to be taken, those who want to claim money from the nearly $10 billion pot will have to do some leg work. The funds will be handed out to states, territories and tribal governments who will then disburse the money to those eligible who make a claim.
Get ready for the new Child Tax Credit
A complete obverhaul of the Child Tax Credit system is set to go live in July when parents of around 88% of American children will start receiving a monthly direct payment. The whole eprocess will be administrated using an online portal, set to be launched by the IRS early next month.
Stimulus checks provide a boost for struggling travel industry
The pandemic has been disastrous for businesses and industries across the country, but few sectors have been as badly hit as the travel industry. Fortunately, after missing out on a summer holiday in 2020, many are using their stimulus check money to splash out on a vacation this year.
“When the stimulus checks came out last March, we saw an increase in booking volume as well as search demand. The stimulus impact has definitely shown up on our end,” said Adit Damodaran, an economist at travel deals app Hopper. “People are taking that money and going to a bucket list destination that they've always been dreaming of, especially as this pandemic turns a corner in the U.S.”
The American Rescue Plan included a major redesign of the Child Tax Credit for the 2021 fiscal year which will include monthly direct payments to parents that choose to receive it in advance. The IRS announced that over 36 million families should be expecting a letter in the mail to inform them about the enhanced tax credit.
The letters will be going to families who, upon reviewing information from either their 2020 or 2019 tax return or who used the IRS Non-Filers tool last year to claim their $1,200 stimulus check, the agency deemed might be eligible for the enhanced credit. The IRS will send out a second letter specifically to families that are eligible for the advanced payments on the credit beginning 15 July.
Federal stimulus spending leaves some states with a tax surplus
As businesses across the country begin to reopen, many states are reporting a considerable tax surplus. Marketplace explain that the source of the added revenue comes from three main sources, one of which is the three rounds of stimulus checks.
While they were a vital lifeline for millions of Americans, they were also intended to kick-start the pandemic-stricken economy and provide new impetuts for business. The stimulus checks had a huge impact on consumer spending in the first few months of 2020 and it appears that this has seen many states receive a tax revenue boost.
IRS informs 36 million families of Child Tax Credit payments
The new-look Child Tax Credit to set to begin next month, with monthly direct payments going out to eligible families. The White House estimate that around 88% of American children will be eligible for the support, but not everyone is aware that the money is coming.
To spread the word, the IRS is sending out letters to all eligible families to let them know that the money is on its way. Half of the money provided will be sent in the form of monthly installments beginning July 15 and going through December, with payments of up to $300 per month for children younger than 6 and $250 per month for those aged 6 to 17.
States benefited from stimulus in more than just direct payments
With people locked away in their houses, businesses shuttered, many laid off from their jobs tax intake for states took a nose dive. State budgeters were preparing for a doomsday scenario but the stimulus bills provided more than direct injections of cash into their coffers.
The covid-19 relief bills gave people laid off unemployment compensation that they might not otherwise have gotten and most Americans received a stimulus check. Both of which gave people money to spend which in turn provided more tax revenue, not to mention that state that tax unemployment benefits had another stream of revenue that hadn’t existed before.
This led to states to some states coming out of the pandemic on a better footing than was predicted in the dark days of the pandemic.
Stimulus creates expectation of strongest recovery since 1940
Rueters - The World Bank on Tuesday raised its global growth forecast to 5.6% for 2021, marking the strongest recovery from a recession since 1940 due to US stimulus spending and faster growth in China but held back by "highly unequal" access to covid-19 vaccines.
The development lender's latest Global Economic Prospects report showed a 1.5-percentage-point increase from forecasts made in January, before the Biden administration took office and enacted a $1.9 trillion US covid-19 aid package. Since then, vaccines have become much more widely distributed in the United States and some other wealthy countries, boosting their output, as forecasts lag for emerging market and low-income countries.
Many emerging market and developing economies were seeing elevated covid-19 caseloads, obstacles to vaccination and withdrawal of support, the bank said. By 2022, this will leave global output about 2% below pre-pandemic projections, and about two-thirds of emerging market economies will still not have made up last year's per-capita income losses.
World Bank President David Malpass reiterated his calls for rich nations, including the United States, to free up excess vaccine doses to developing countries as quickly as possible.
The IRS wants you to be informed about the Child Tax Credit
For tax year 2021, families claiming the Child Tax Credit will receive up to $3,000 per qualifying child between the ages of 6 and 17 at the end of 2021. They will receive $3,600 per qualifying child under age 6 at the end of 2021. Under the prior law, the amount of the Child Tax Credit was up to $2,000 per qualifying child under the age of 17 at the end of the year.
If you still haven't filed your taxes the IRS urges you to do so as soon as possible to be automatically signed up for the enhanced credit and take advantage of other credits that you may be eligible for including the Earned Income Tax Credit which has also be given a boost in the American Rescue Plan.
Congress has authorized three rounds of Economic Impact Payments to Americans alleviating the financial hardships endured during the pandemic. Although the first went out without much haggling, the later direct payments encountered more resistance over how much struggling Americans needed, who would get them and the overall price tag for future generations.
The length of time it could take for Americans to see a fourth stimulus check mainly depends on the urgency of need and the ability of Congress to work together.
As well as the financial aid provided through stimulus checks, unemployment support, child care and other benefits, a key part of the Biden administration's strategy to say goodbye to the crippling effects of the pandemic was its vaccination rollout.
To keep you fully up to date with all the latest news and updates regarding covid-19 vaccines, their development and the ongoing incentives in the US, we bring you a daily blog.
Essential workers in a California city getting $1,000 stimulus check
The city council of Oxnard, a city of about 208,000 northwest of Los Angeles, unanimously approved paying a $1,000 bonus to anyone who worked at least three months in a grocery store or pharmacy during the first 12 months of the covid-19 pandemic. The measure would use $2.5 million in stimulus money allocated to the city by the American Rescue Plan.
The city had considered implementing a hazard pay mandate to make companies shoulder the burden of topping up their workers' paychecks but those ordinances received pushback and lawsuits in other cities that attempted such measures. This way the city avoids a confrontation with businesses in its community and it will be faster and easier to institute.
A call for “Greenway stimulus” in Detroit
States and local governments are figuring out how to spend the $350 billion coming their way. One suggestion for Detroit from Chad Livengood is to make getting from A to B by foot a little easier. He may be in luck if the city foregoes his input. There is a push to include $10 billion in “Greenway stimulus” as part of the American Jobs Plan. The funds would go toward improving the safety and design of trails for those who move around without a car. Currently half of the trips people take in the U.S. are within a 20-minute bike ride and one-quarter are a 20-minute walk.
Enhanced Child Tax Credit is Social Security for kids
Social Security although blasted at the time of its creation has become a fabric of our society allowing the elderly to retire without ending up in poverty. The new-look Child Tax Credit included in the American Rescue Plan is currently temporary and will expire at the end of the year if not further action is taken. It too could help alleviate poverty, but this time for children with estimates that childhood poverty could be cut almost in half.
Wealthiest Americans paying nearly zero tax
As President Biden proposes raising taxes on the rich to help pay for the next phases of his Build Back Better plan for infrastructure and families, ProPublica releases a trove of Internal Revenue Service data on just how much the richest pay. The cache of information covers 15 years of thousands of the wealthiest Americans tax returns, including Jeff Bezos, Warren Buffett and Bill Gates.
The records show that far from paying the most taxes, they’ve paid very little compared to their vast fortunes and in some cases nothing, and it was perfectly legal.
No fireworks on ending stimulus expected when ECB meets on Thursday
Bloomberg reports: European Central Bank policy makers have all the evidence they need to keep in place their ultra-loose monetary stimulus when they meet on Thursday, thanks in part to their opposite numbers at the Federal Reserve.
Despite a faster US economic rebound from the pandemic and far higher inflation than in the euro zone, Fed officials have signaled they won’t slow bond buying at their own decision a week later. Their reasoning? They still can’t be sure that the recovery is entrenched enough to be self-sustaining.
“Recent signals from the Fed probably help the ECB,” said Gilles Moec, chief economist at AXA Investment Managers. “I don’t expect fireworks on Thursday, I don’t think they want to rock the boat.”
The covid-19 relief bill provided emergency aid to tens of millions of Americans facing financial insecurity due to the pandemic.
Despite ongoing debate over safety net policy, a new analysis of US Census Bureau “household pulse” surveys looks at how the stimulus aid impacted Americans. H. Luke Shaefer, co-author of the study and Director of Poverty Solutions at the University of Michigan, joins.
Global markets continue to react to stimulus policies
Markets were in consolidation mode on Tuesday, with world stocks hovering just off record highs, the dollar lifted by upcoming inflation data and the main volatility gauges all looking reassuringly calm.
There was some pressure on sterling as the UK government considered whether to delay removing most of its remaining coronavirus restrictions by two weeks, but it looked like being temporary at worst.
London's FTSE was up 0.2% in line with the pan European STOXX 600. MSCI's 50-country world index was flush to its latest record high and Wall Street futures were steady after its tech titans shrugged off global plans to tax them more over the weekend.
In the bond markets, government bond yields were edging lower ahead of a policy meeting of the European Central Bank (ECB) and US inflation data, both due on Thursday.
Recent comments have suggested that the ECB has no plans to start reeling in its mass stimulus programme any time soon, while the US May consumer price index print will be closely watched ahead of a Federal Reserve meeting next week.
Plenty stimulus cash still unspent
As CEO of one of America's biggest banks, Bank of America's Brian Moynihan has unique insight into the health of the country's economy. And right now, what he's seeing is positive.
What's happening: In an interview on CBS' "Face the Nation" on Sunday, Moynihan said that consumer spending has jumped above $1 trillion this year, a 20% increase over 2019 levels.
And Americans are still sitting on a lot of extra cash.
Full story below.
In recent months a growing number of Democrats in Congress have given their support for another round of stimulus checks with a series of pubic letters addressed to President Biden.
In March the American Rescue Plan provided a third direct payment worth up to $1,400 per person, but there is concern that many low-income households are in need of further support.
On 17 May seven members of the House Ways and Means Committee, the congressional body who provides oversight on issues of federal spending, became the latest to join the cause. They wrote that “a fourth and fifth check could keep an additional 12 million out of poverty,” but how has the White House responded to their request?
If financial markets are already in the summer doldrum mode, that could mean gold prices could steadily rally over the next couple of months
Stimulus plans see gold hold
Gold held gains as investors awaited a key US inflation report due later this week for clues on when the Federal Reserve may begin to talk about tapering its asset purchases.
Bullion steadied on Tuesday after rising 1.5% over the past two days as traders assessed a smaller-than-expected gain in US payrolls as well as comments from Treasury Secretary Janet Yellen saying that higher interest rates would be a “plus” for America and the Fed, which weighed on the dollar.
Gold is still holding close to $1,900 an ounce amid rising price pressures and speculation that central banks may eventually pare back stimulus as the global economy recovers from the pandemic. Thursday will bring the European Central Bank’s decision, as well as the US CPI report which will be one of the last major economic indicators before the Fed’s next policy meeting 15-16 June.
Full story below:
The American Rescue Plan included a little-known clause which prevented taxes being levied on unemployment benefits received during 2020. The move was made to help jobless Americans during the pandemic, but not all were able to take advantage of it initially.
The legislation was not passed until mid-March, by which time millions had already filed their tax returns and paid taxes due. These people will now be due a hefty tax refund, which the IRS is currently in the process of distributing.
Will Gittens brings you what you need to know.
US stimulus spending broken down
The US government approved $5.3 trillion worth of fiscal pandemic-aid packages over the past 14 months to shore up the US economy and American households. The scope is nearly unfathomable but MarketWatch provides a quick look at the COVID-19 aid to date from Mizuho Securities.
2021 Child Tax Credit: IRS reaching out to eligible families
Normally families would have to claim the Child Tax Credit when they file a tax return, however this year all families need to do is file a 2020 tax return. The IRS urges parents that missed Tax Day, it was 17 May, to file a tax return, even if you have no income, so that they will be automatically signed up for the enhanced Child Tax Credit for the 2021 fiscal year included in the American Rescue Plan.
Eligible parents will get a tax credit for up to $3,600 for children 5 and under and up to $3,000 for children ages 6 to 17. If the IRS determines that you may qualify, the agency will be sending you a letter.
Aside from the third federal stimulus checks worth $1,400, some US citizens have or are set to receive payments from state governments offering further financial relief beyond that approved in Washington.
California was not the only state to offer stimulus payments back in early spring. In February, Maryland’s government approved stimulus payments of $300 for individuals and $500 for joint filers as part of the state’s RELIEF Act, which was passed before the approval of President Joe Biden’s American Rescue Plan.
New Mexico, meanwhile, began sending out $600 payments in the form of tax rebates to eligible residents in March. The one-time rebates were available to taxpayers who are not dependents, who receive the Working Families Tax Credit, and who have an adjusted gross income of $31,200 or less (single filers) or $39,000 (married filing jointly, heads of household).
Restaurateurs see uptick in job applicants with “Return to Work” bonus
Enhanced unemployment benefits are due to expire 19 June in New Hampshire, but the state is also offering residents who get off unemployment benefits and hold a job a bonus. Governor Sununu announced the summer stipend program in May, it is on a first-come, first-served basis and will give $500 or $1,000 bonuses if they keep the job for at least eight weeks.
Although restaurant owners recognize that there are many factors keeping people from re-entering the job market, such as fear of covid-19 and child care issues, one has seen more applicants in the last two weeks than the last two months.
Infrastructure spending explained: Psaki
President Biden has been meeting with Senator Shelley Moore Capito (W.Va.), the top Republican negotiator in the Senate to reach a compromise on infrastructure spending, the next part of his stimulus spending for the US. President Biden has brought his $2.2 trillion proposal down by one trillion dollars, but sees the latest offer by the GOP as underwhelming, raising their proposal just a tenth of what the President has cut from his.
White House press secretary Jen Psaki said on Monday that there are three paths forward. One a negotiated deal with Capito, but the President will not let negotiation drag on forever. "The time is not unlimited here … nor is the president's willingness to compromise," Psaki said. Two a deal between GOP and Democratic lawmakers in Congress. And three putting the full weight of the White House behind The INVEST in America Act, a bill being marked up this week by the House Transportation and Infrastructure Committee.
In March Florida Governor Ron DeSantis proposed a one-time relief payment of $1,000 to Florida’s first responders and educators for their sacrifices and stepping up to meet the challenges of the pandemic.
With the signing of the budget last week around 174,000 Florida first responders and nearly 180,000 educators can look forward to a bonus soon. The state budget has set aside over $400 million to pay for the bonuses which the Florida Department of Economic Opportunity began working on distributing after the bonuses for first responders were announced.
The Governor DeSantis has said that he expects the payments to be sent throughout the summer.
Full story from Greg Heilman.
Stimulus checks live updates: welcome
Hello and welcome to our daily blog on stimulus checks for Tuesday 8 June 2021.
Here you'll find updates on a possible fourth stimulus check, plus information on the third round of checks, which has seen the IRS send out $391 billion in direct payments since March.
We'll also provide info on schemes such as the expanded Child Tax Credit, which enables qualifying families to claim up to $3,600 per child per year, and everything else related to President Joe Biden's relief program.