Fourth stimulus check summary: 20 June 2021
US stimulus check updates | 20 June 2021
US stimulus rise and inflation risk
An increase in fiscal stimulus by the government and the uncertainty around inflation has "contributed to the steepening of the yield curve," said Eric Robertson of Standard Chartered.
Listen to his assessment on Squawk Box.
Infrastructure stimulus and climate responsibility
“No climate, no deal” is the new catchphrase among climate groups and lawmakers in the House and Senate. Not just stalwart Green New Dealers like Massachusetts Senator Ed Markey but also more centrist types like Senator Michael Bennet of Colorado and New Mexico Senator Martin Heinrich have echoed the sentiment with tweets and press statements in the past few days.
So far, nine senators and 12 House members have said they won’t vote for any version of the White House’s infrastructure bill that doesn’t include bold climate action.
But what exactly does “bold” mean? TNR takes a look.
He’s happy to hear from a range of ideas on what would be most effective and what’s most important to the economy moving forward
Did Andrew Yang 'make the stimulus checks happen'?
As campaigning intensifies in the race to win the Democratic nomination in the New York City mayoral election, some are questioning the claims made by one of the fore-runners. The wife of former presidential candidate Andrew Yang has reportedly claimed in a New York Times interview that the entrepreneur played a key role in securing one of the previous rounds of stimulus checks.
Yang has fallen back in the race, according to recent polls, but his proposal of a universal basic income for the city's poorest residents could bring some voters back on board.
IRS delays: Is identity theft delaying stimulus checks and tax refunds?
The Tax Advocate Service (TAS), an independent branch of the IRS that services to represent the needs of US taxpayers, has released a report that details a sharp increase in fraud this tax season. This could mean that you are waiting longer than usual for your tax refund this year.
Each year, the TAS releases a report to Congress describing the tax season, including the challenges and milestones that were made. This year one of the main challenges identified was the delay many in the US are experiencing in receiving their tax refund. The report highlights that these delays have been caused by the “IRS’s fraud detection filters.”
Child Tax Credit Awareness Day to be held tomorrow
Since the American Rescue Plan was first signed into law in March the White House has been looking to push the benefits of the Child Tax Credit to the American people. The new programme marks a big change from the previous style of credit, with monthly direct payments going out from 15 July onwards.
However research suggests that many families are unaware of the forthcoming support. To spread the word the Biden administration has sent out letters to inform all eligible families of the upcoming payments and has scheduled a Child Tax Credit Awareness Day for Monday 21 June.
How to check the status of your IRS tax refund
The IRS have estimated that around 13 million Americans are eligible for a tax refund this year as a result of the unemployment benefits tax exemption included in the American Rescue Plan. The recent stimulus bill made the first $10,200 of jobless support received in 2020 complete tax-free, but millions had already filed their taxes before the legislation was passed.
The payments will be issued automatically, but if you think you may be in line for a refund you can check the status of your money using the IRS' handy online portal...
$3,000/$3,600 Child Tax Credit: which families might need to opt out?
The IRS will begin sending monthly payments as part of the enhanced Child Tax Credit to around 36 million American families on 15 July. Depending on the age of the children and eligibility of the parents, those payments could be up to $300 per month through December.
The system will work similar to how the Economic Impact Payments, better known as stimulus checks, with the amount that families receive based on the most recent information the IRS has on file through a tax return or the Non-Filer tool which has been relaunched.
Study outlines the benefits of stimulus check payments
A recent study from the University of Michigan has found that previous rounds of direct payments have had a positive impact on a number of key areas. Their findings suggest that stimulus check recipients often experienced an improvement in their access to food, mental health and general financial stability.
This study may well be used by proponents of the fourth stimulus check as evidence that more support is needed. Although the payments contibuted to a huge spike in consumer spending in April, that effect has tailed off subsequently.
Child Tax Credit for non-filers: how and when to sign up
The IRS has announced that the new Child Tax Credit programme will go into effect next month when they start sending the monthly payments on 15 July.
As was the case with the stimulus checks, eligibility for the federal support will largely be based on information provided in your most recent tax return. The payments will arrive automatically for most recipients but some low-income households may have to utilise the IRS’ new non-filer sign-up tool to ensure they get the payments.
Lindsey Graham warns Dems not to do side hustle on stimulus
The so-called G20 bloc a bipartisan group of 11 Republicans and 10 Democrats hammered out a framework for investing in US infrastructure. Lawmakers from both parties took to the Sunday news shows to pitch their views on how and what to pass in any eventual bill. Some progressive Democrats feel that what has been released so far about the bill doesn’t go far enough and have talked about pushing through a $6 trillion plan that would include the American Jobs Plan and the American Families Plan.
Senator Lindsey Graham who became the 21st member of the G20 bipartisan group advised against that and urged President Biden to take bipartisan deal. Speaking "If you want to work with Republicans to spend a trillion dollars of — on infrastructure, it's available to you," Graham said on Fox News Sunday. "If you don't want to go that route and you pick a $6 trillion reconciliation package, I think you'll get a lot of pushback from every Republican."
Fourth stimulus check: can the decrease in consumer spending impact its approval?
New data on consumer spending in the retail sector slid further in May after peaking in March with the passage of the third round of stimulus checks.
Will the latest numbers encourage the approval of another check being sent?
How does the bipartisan infrastructure bill compare to Biden's American Jobs Plan?
Last week, Senator Susan Collins of Maine announced that she and ten other Democratic and Republican senators had reached an agreement on a bipartisan infrastructure proposal. Since the announcement, details have begun to be leaked, released, and reported. The announcement on a deal between members of both parties came after negotiations between the White House and top Republicans collapsed over the President’s own proposal.
New info has become available on what will be included in the bipartisan infrastructure bill which is gaining support in the Senate.
Creative ways to pay for infrastructure bill
Senator Rob Portman one of the G20 bipartisan group of senators hashing out a deal on infrastructure spoke with Chuck Todd on Meet the Press Sunday. Sen. Portman said that the group was coming up with “creative ways” to finance the $1 trillion proposal, details of which are due to be released on Monday.
Sen. Portman talked about creating an Infrastructure Bank for funding public and private projects, as well as repurposing covid-19 relief funds. As for a “user tax” for vehicles gas or electric, Sen. Portman said that it could be left out but that the White House will need to come up with another pay-for in the plan.
“The process has just begun” on infrastructure bill
Speaking with Dana Bash on CNN’s State of the Union, Senator Bernie Sanders said “I think there is general agreement that the time is long overdue that we address many of the long-neglected problems facing the middle class and working class of this country.“
“Are there differences about this proposal, that proposal, the amount of money. Yes, there are. And we’re going to have to work together to hammer out, and I intend to do that.”
Biden looking to pay for agenda by collecting from tax cheats
President Biden has proposed giving the Internal Revenue Service $80 billion in new funding to allow the tax authority to improve customer service and close the tax gap. In April IRS Commissioner Chuck Rettig told Congress that the US government is losing out on $1 trillion in uncollected taxes each year. To help stop this bleeding, US Treasury Secretary Janet Yellen has set up what internally is called the “compliance brain trust.” As part of the team she’s assembling, she has , has been brought in Natasha Sarin, a 32-year-old Harvard-trained economist who has written extensively on closing the gap.
Find out more about Natasha Sarin and the “compliance brain trust” at The New York Times.
IRS tool for Child Tax Credit: link and how to use it
The Internal Revenue Service announced on Monday that it has brought back the Non-Filer tool that was first created last year to help taxpayers who don’t normally report income claim their $1,200 stimulus check. The updated version will allow those who still haven’t filed a tax return or used the tool before, to register for the 2021 Child Tax Credit.
Additionally those who missed out on the stimulus checks because they weren't required to file a tax return and didn't use last year's Non-filer tool can use the revamped version to collect all three stimulus payments pending.
IRS issues cyber criminal warning
The Internal Revenue System warns customers about the presence of online cyber criminals looking to secure personal data and information.
What is a "death tax" and what's Biden proposal?
The moniker “death tax” is used instead of inheritance or estate tax by those who want to abolish accumulated wealth being taxed when it is passed down. President Biden is proposing changing how estates are taxed, removing a loophole used by the wealthiest Americans to entirely escape tax on their estates.
Normally when a mortal, and living, soul sells an asset (stocks, property or other item of value) the IRS will tax the individual on the gains accrued from the time of its original purchase. However, under current law an asset is “stepped-up” to its current valuation upon being inherited so the heir will only pay tax on the accumulated value from that point should they decide to sell it in the future.
The original owner never pays capital gains on the asset since it wasn’t sold. This process allows property to pass from one generation to the next to escape taxation entirely.
When could a fourth stimulus check be approved?
President Joe Biden has presented the next two phases of his Build Back Better plan which would see an additional $4 trillion in spending on infrastructure and American families. Both pieces of legislation are expected to encounter headwinds from Republicans because of the sheer size of the plans.
The White House called off negotiations with GOP senators over his American Jobs Plan after the counter offer from Republican negotiators was seen as insufficient and lacking core proposals. A bipartisan group of 20 senators has reached an initial agreement on a framework for an $1 trillion infrastructure investment package but progressive members of Congress have slammed it for not tackling the challenges that climate change presents.
Republican lawmakers want the legislation to focus on traditional infrastructure, negating any likelihood that a stimulus check or other form of direct payment could get into the bill if the White House wants Republicans to support a final legislative proposal. “This has got to be the meat and potatoes of infrastructure: roads, bridges, and ports, and that’s what we’re trying to push,” Senator Lindsey Graham of South Carolina said.
When could there be a new stimulus payment according to the experts?
The three rounds of stimulus checks that have been sent out over the past year provided substantial financial and mental relief to Americans struggling through the economic crisis brought on by the covid-19 pandemic according to a recent analysis.
Research performed by Luke Shaefer and Patrick Cooney for Poverty Solutions at the University of Michigan looked at data collected by the US Census Bureau in its Household Pulse Survey. The findings stoked renewed calls for programs to put money directly into the pockets of Americans.
IRS to send advance Child Tax Credit payments in July
Around 88 percent of families in the US can expect monthly direct payments, if they choose to receive them, starting 15 July.
As part of the American Rescue Plan the Child Tax Credit got a major overhaul. The amount of the refundable credit more than doubled and the income floor to receive it was removed. Families could receive a monthly payment of up to $300 per child under 6 and/or $250 per child under 18 at the end of the year.
In order to receive the payments, it is necessary to file a 2020 tax return, even if you haven’t done so yet. Or for those who aren’t required to file a tax return due to little or no income, the IRS has relaunched its Non-Filers online tool, so that those Americans can provide their information to the tax authority to get signed up for the monthly direct payments.
Other states and local governments sending out stimulus payments
Around the US states, at least one city and the Cherokee Nation are using federal stimulus money to give members of their communities an extra covid-19 relief payment. Maryland and California have already sent out payments to residents who claim the Earned Income Tax Credit in their respective state or hadn’t received a federal stimulus check.
However, Governor Gavin Newsom upon announcing California’s windfall budget surplus said that even more Californians could possibly get an extra $600 stimulus check or more. Those earning up to $75,000 will be eligible to get a Golden State Stimulus check once the state budget passes. The California Legislature sent the Governor a placeholder budget on 14 June a day before the deadline. The two sides will hammer out last-minute differences in the coming weeks.
Fourth stimulus check: could it be approved before July?
The US Congress is nowhere near approving a fourth stimulus check as it labors on working out the details of an infrastructure bill, which has started to make some headway. But that doesn’t mean that Americans won’t be seeing any new direct payments in the coming months.
Some states and local governments have devised their own stimulus programs for certain residents that will start going out beginning July. Parents with qualifying children will start seeing direct payments hitting their bank accounts in mid-July as well, as part of the Advance Child Tax Credit 2021.
Fourth stimulus check: could the next payments be automatic?
Many lessons have been learned from the covid-19 pandemic induced economic crisis. One that direct payments were beneficial to many American households and kept the economy from completely tanking. Another that our unemployment system is outdated for the 21st Century.
Congressional Democrats have been pushing the White House to extend stimulus checks and unemployment compensation programs until the end of the pandemic. President Biden hasn’t spoken directly about where he stands only that he is open to ideas for how to move forward.
How to check the status of a tax refund
A late addition to the American Rescue Plan ensured that unemployment benefits recipients were not taxed on the first $10,200 of support that they received during 2020. However by the time the stimulus bill was signed into law in March this year, millions of Americans had already filed their returns for the year and paid taxes on it.
This means that an estimated 13 million people are in line to receive a tax refund but the IRS is facing delays in getting that money out. To check on the status of your payment, use the IRS' handy Where's my refund? online portal.
Child Tax Credit payments will not affect other benefits
The new-look Child Tax Credit is set to be introduced from next month but there is still some confusion about how the system will work. The overhauled programme will provide monthly payments worth up to $300 per child but some are concerned that it may affect their eligibility for other forms of federal support.
The Intercept's Washington DC bureau chief confirms here that, because the Child Tax Credit payments are not considered a form of income, they will not be added to your adjusted gross income figure. This means they will not affect your ability to claim other benefits programmes.
What is a "death tax" and what's Biden proposal?
The moniker “death tax” is used instead of inheritance or estate tax by those who want to abolish accumulated wealth being taxed when it is passed down. President Biden is proposing changing how estates are taxed, removing a loophole used by the wealthiest Americans to entirely escape tax on their estates.
Could China backlash lead to more bipartisanship in the US?
Across the Atlantic, UK Labour party politician Andrew Adonis seems to think so. In response to an article in the The Guardian, Adonis has tweeted: "China’s behaviour is unleashing a fierce bipartisan backlash in America. That’s fine if it leads to more public investment in basic research, education, and infrastructure – as did the Sputnik shock of the late 1950s."
If Adonis' theory proved right, it could perhaps facilitate future deals on issues such as stimulus spending, which could improve the likelihood of a fourth stimulus check. Although opposition to a fourth direct payment will undoubtedly remain strong among Republican lawmakers, regardless of whether the parties draw somewhat closer due to mutual sentiments on China.
Fiscal stimulus as percentage of GDP: US in second place
Combined, Donald Trump and Joe Biden's respective stimulus packages have cost a massive $5 trillion, which equates to 27.09% of GDP. During the coronavirus pandemic, only Japan has spent more on stimulus as a percentage of GDP. The US is in second, ahead of Singapore, Slovenia and Guyana.
Petition for recurring stimulus checks surpasses 2.5m signatures
A change.org petition calling for recurring monthly $2,000 checks is nearing closer to its 3m signature target, with more than 2.5m having now signed. The petition comes after several Democratic letters signed a letter asking President Joe Biden to approve recurring stimulus payments of $2,000.
The petition mission statement reads:
"Our country is still deeply struggling. The recovery hasn’t reached many Americans – the true unemployment rate for low-wage workers is estimated at over 20% and many people face large debts from last year for things like utilities, rent and child care. These are all reasons that checks need to be targeted to people who are still struggling and that Congress needs to learn from this past year."
"It took nine months for Congress to send a second stimulus check, and just moments to spend it. Moving forward Congress needs to make recurring checks automatic if certain triggers are met. No more waiting around for our government to send the help we need."
Stimulus money for foster youth
Between $500 - $2,000 in stimulus relief funds has been made available for current and former foster youth in the majority of US states, with over 800,000 young people eligible across the country.
To find out more, go to checkforus.org.
Texas republican Tony Gonzalez says GOP pushing for bipartisan infrastructure bill
Claiming that government spending has gone "out of control," Rep. Tony Gonzalez, R-Texas, told "Fox Report" Saturday that Republican lawmakers are pushing for a bipartisan infrastructure bill.
"I mean, what a deal. Only 1 trillion instead of 6 trillion? I mean, one, the spending has gotten really out of control. I would say Republicans have really pushed hard for a bipartisan infrastructure package," he said.
He added: "And, look, our roads are crumbling. Our bridges are falling apart. Our ports need to be updated. There is no doubt about that. But there is a couple of red line items for us: One, we will not accept any raising of taxes. That’s one. I think there’s an opportunity, maybe to reappropriate some COVID funds that haven’t been spent. I think that’s an opportunity to get it going, but we really have to have the discussion on what is infrastructure."
The nation needs a bipartisan infrastructure deal
The Washington Post Editorial Board argues that the nation is in desperate need of bipartisan deal to show that US democracy can work and the nation could benefit from the investment. In their opinion President Biden should back the deal but he would be right to ask for taxes on corporations be raised but shouldn’t give in to demands not to adjust the gas tax that hasn’t changed since 1993.
To read more of their opinion click here
Could the next stimulus checks be automatic?
As the US looks to negotiate a tricky post-pandemic economic recovery there are growing calls for a system to be put in place ensure that support is available when needed. In the past each round of relief spending has been the results of Congressional negotiations, which can take months.
To avoid that delay in future many lawmakers are in support of a system of "automatic stabilizers" which could provide a fourth stimulus check whenever certain criteria are met. If the recovery stalls or unemployment begins to rise the stabilizers would send out direct payments to give the economy a boost.
Was Andrew Yang influential in securing the stimulus checks?
Stimulus check payments have been a notable feature of the pandemic-stricken American economy over the past 15 months. The first round of the direct payments came in Spring 2020 when former President Trump signed the CARES Act into law.
The wife of New York mayoral candidate Andrew Yang, Evelyn, has credited her husband with pushing for further rounds of payments. In an interview with NY Mag, Evelyn Yang says he “talked to dozens of legislators” and “was responsible for the House version” by Democrats that eventually gave people stimulus checks worth a combined $2,000 per person.
California uses tax surplus for stimulus spending splurge
The pandemic has been terrible for businesses across the country with covid-19 restrictions hampering their ability to make money and making some firms entirely unprofitable. Yet despite this the state of California reported a huge tax surplus on the last fiscal year, something that economists has credited to the booming stock market.
As such, Gov. Gavin Newsom has been able to fund a huge splurge of state spending that included the Golden State Stimulus bill. This included a stimulus check payment for low-income residents, which was later expanded to cover roughly two-thirds of Californians.
IRS sending out 'plus up' stimulus payments
THE IRS is continuing to send stimulus 'plus-up' payments to Americans based upon information from taken from their tax returns, with a further 2.3 million checks issued last week.
The IRS has said the plus up payments are "for people who earlier in March received payments based on their 2019 tax returns but are eligible for a new or larger payment based on their recently processed 2020 tax returns".
Stimulus checks live updates: welcome
Hello and welcome to our live stimulus checks blog for today, Sunday 20 June 2021. We'll be bringing you updates on a possible fourth direct payment, in addition to information on the third round of checks, which has seen around $395 billion go out to eligible people in the US.
We'll also be providing news on other economic-aid schemes such as the expanded Child Tax Credit, which will see monthly payments of up to $300 distributed to qualifying households.