Fourth stimulus check news summary: 19 August 2021

IRS warn against online scammers

The Internal Revenue Service has warned uses of various tactics being employed by online scammers and advised to be aware for certain misleading claims online.

Kerry Washington answers questions about the Child Tax Credit 

Trying to raise awareness about the Child Tax Credit that was enhanced under the American Rescue Plan, Kerry Washington answers some of the questions she’s come across. Have a watch.

Stock markets shaky over possible Fed stimulus pullback 

Investors are considering how the highly transmissible Delta covid-19 variant will affect the Fed’s decision on when to taper its stimulus program. Minutes from the central bank’s meeting were released on Wednesday showed that there was agreement on pulling back from the Fed’s purchase of government-back bonds, but that the timing of such a move is still in doubt.

The S&P 500, NASDAQ and Dow Jones all fluctuated between lose and gain with only the Dow Jones finishing in the red. The S&P 500 eked out a small gain after initially experiencing its biggest drop since mid-July.

Larry Nassar’s stimulus checks seized to pay victim restitution 

A month ago, prosecutors asked for Larry Nassar’s prison fund frozen after learning that he has been paying the bare minimum, $300, of the more than $62,000 he owes his victims and for court fees despite receiving $12,825 in the three years he has been in federal prison.

US District Judge Janet Neff on Thursday ordered the seizure of just over $2,000 Nassar received from two of his stimulus checks. Larry Nassar is the former USA Gymnastics and Michigan State University doctor accused of sexually abusing hundreds of girls and women and sentenced to 60 years in federal prison in 2017.

First advance Child Tax Credit payment reduced anxiety 

CNBC reports that the data is in on the effect the first of six-monthly payments that will go out this year from the 2021 Child Tax Credit and it was about what experts imagined.

61 million children across the nation benefited from the enhanced tax credit program reducing financial anxiety for 56% of households that received the July payment according to one survey. Difficulty covering costs of living decreased for families with children while increasing for those without in July.  

The main expense that recipients spent the monthly booster to family income on were groceries, dropping the rate of food insufficiency by 20 percent. This was followed by school supplies. Next in line were savings and household bills, pretty much how payments were supposed to help families.

Save your child care receipts in 2021 to receive extra tax benefits

Millions of families across the US are receiving extra help on a monthly basis at least through December from the advance payments on the 2021 Child Tax Credit. Democrats in Congress are working on extending the enhancements which include increasing the amount of the credit, making it fully refundable and dropping the earnings floor so that even those with no earned income can benefit from the program. 

The American Rescue Plan also enhanced the Child and Dependent Care Tax Credit for 2021. The credit was made refundable as well, so any money a family can claim on the credit that exceeds the taxes they owe will be included in their tax refund. Families could claim up to 50% of expenses incurred for child care while they are working, looking for work or studying. For parents of one child, the credit could be worth up to $4,000 and for two or more $8,000. 

Like with the Child Tax Credit the changes are only for the 2021 fiscal year unless Congress acts. 

Unemployment Benefits

What pandemic programs will remain once extra unemployment benefits end?

The enhanced federal pandemic benefits are due to expire on Labor Day, 6 September, but there are still other schemes available to help those who are out of work.

Full details

An explainer of the 2021 Child Tax Credit 

For those who still don’t know about the 2021 Child Tax Credit or are looking for a breakdown of the enhanced tax credit features, the Taxpayer Advocate Service provides a breakdown of the programs features and advice on how to claim it if you are still not signed up.

States encouraged to use stimulus money to extend unemployment benefits 

Enhanced federal pandemic unemployment benefits are set to expire 6 September and it doesn’t appear that Congress will extend them before that date. To cushion the blow that could impact local economies around the US where unemployment numbers remain high President Biden and Secretary Yellen have recommended that states use funds from the American Rescue Plan to continue some of the federal jobless aid programs.

However, the President still believes that the $300 extra on top of other unemployment compensation should be allowed to expire in light of the ongoing economic recovery saying that it was “always meant to be temporary.”

US NEWS

"Active Bomb Threat" at US Capitol after authorities spotted a suspicious vehicle

BREAKING

August is normally a slow month on Capitol Hill, but buildings are under evacuation order after a man in a suspicious pickup truck was spotted at the Library of Congress.

Capitol Police have taken to social media saying that, "This is an active bomb threat investigation. The staging area for journalists covering this situation is at Constitution and First Street, NW for your safety. Please continue to avoid the area around the Library of Congress."

The threat comes as politicians have been negotiating the infrastructure bill and the House prepares to come back from summer recess.

Read more here

I don’t think there’s any appetite for [continuing unemployment payments]... I think given the strength of the economic recovery and the labor market recovery, there’s basically no possibility of that happening.

LATEST NEWS

When will unemployment benefits expire?

Federal unemployment benefits will officially be over on Labor Day, however, it might need to end earlier than expected due to state administrative rules.

All states pay benefits at the end of every week, depending on each state this payment will be done either Saturday or Sunday. But officials have set benefits’ expiration date on Monday, September 6, according to this year’s calendar for Labor Day.

The president’s statement added to the fact federal lawmakers passed legislation twice in the past year to avert a benefits cliff, makes the possibility of an extension highly unlikely.

Read more here

Reminder of the necessity to file a tax return to get the Child Tax Credit

If you didn't file your taxes in 2020 or 2019 then you will need to use this link to the IRS portal. You can fill in the necessary details there to make sure your payments begin.

The IRS also has a FAQ page on its website for other pressing questions.

Does the infrastructure bill do enough to tackle climate change?

The House is due to return from its summer recess in September and the infrastructure bill will be scrutinized in detail. Progressives are already unhappy with the lack of provisions to stop the climate crisis.

The opinion from Carl Pope says, "Most U.S. infrastructure was built to withstand once-in-a-century floods, fires, storms and droughts, so that only 1% of it was vulnerable each year. But those disasters now happen every 20 years or less."

"President Joe Biden’s infrastructure plan, ambitious as it is, neglects the preventive maintenance that could allay long-term costs of disaster relief and infrastructure repair."

"Currently, we do the opposite. Not believing in prevention, we underinvest in virtually every aspect of our built environment. According to the World Bank, European countries spend 5% of their gross domestic product on building and maintaining their infrastructure, while the U.S. spends 2.3%."

Unemployment claims dropped for the fourth consecutive week in the United States

How are people spending their Child Tax Credit payments?

New data from the polling organization Morning Consult, shows that most recipients are spending the money rather than saving it. Those opting to spending the money may be motivated by "rising household expenses [that] quickly absorbed the extra income in July."

Which city in the US has seen the largest increase in wages this year?

According to the BLS, San Fransisco, known for its high cost of living, saw the greatest increase. The year-over-year gain in San Fransisco was recorded at 33.9%. The report from the Department of Labor read that "Within San Francisco, an average weekly wage gain of $2,398 (+247.5 percent) in leisure and
hospitality made the largest contribution to the county’s increase in average weekly wages."

What is stalling the negotiations over the bipartisan infrastructure and reconciliation bill in the House of Representatives?

August is known as a slow month in Washington DC as most members of Congress return home for summer recess. However, this summer, some leaders and their staff have remained in the Capitol to negotiate the bipartisan infrastructure and reconciliation bill.

But, over the last few weeks, no major news on either bill has been made public. For progressive pod caster, and former National Press Secretary for the Sen. Bernie Sanders (I-Vt.) 2020 campaign, Briahna Joy,  the process is being slowed by a "game of chicken," between progressive and moderate Democrats.

In a recent statement, Joy said that "there's a bit of a game of chicken where the conservatives in the Democratic Party are agitating now to say, 'Okay I want to vote for the bipartisan bill first,' as if that's not a clear signal that they are looking for an excuse to get out of voting for the more progressive reconciliation package."

Read the full story from The Hill here.

How did unemployment benefits keep the US economy afloat during the pandemic?

New data from the Bureau of Economic Analysis shows steady GDP growth in Quarter 2 of 2021. In part, the 6.5% increase in GDP relates to the fact that the US federal government passed various stimulus bills that kept cash in people's pockets.

Like many economies around the world the worst thing that can happen is that people stop spending money. By providing enhanced unemployment benefits that boosted household income, in some cases to levels higher than those seen before the pandemic, the economy was able to remain stable.

MarketWatch took a deep dive into exactly how unemployment benefits set the US for a smooth economic recovery. Read the full story here.

Following the lead of other states like Indiana and Maryland, unemployed workers in Ohio are suing the government to force them to restart the payment of the $300 a week federal topper pad in addition to state unemployment compensation.

USDA announces historic increase to SNAP benefits

The federal government has announced an increase to the value of food stamp, or Supplemental Nutrition Assistance Program (SNAP) benefits, as they are formally known.

Curious to learn more about the increase or to see if you are eligible? Read our full coverage to find out.

How has the pandemic impacted GDP growth?

The Gross Domestic Product, GDP, "is the value of the goods and services produced by the nation’s economy less the value of the goods and services used up in production."

According to the Bureau of Economic Analysis, GDP grew by 6.5 percent from May to June 2021. This figure is slightly higher than, 6.3 percent increase recorded from January to March 2021.

The GDP of the United States and basically every other country on earth took a huge hit when the pandemic began last year. During the same period, April to June 2021, the US GDP shrank by over 30 percent but thanks to government stimulus and assistance, it bounced back rather quickly.

As the economy recovers and begins to stabilize, the rate of GDP growth is expected to slow.

Read more from the BEA here.

UNEMPLOYMENT BENEFITS

Can you get unemployment benefits if you are fired for denying the covid-19 vaccine?

Can you get unemployment benefits if you are fired for denying the covid-19 vaccine?

As federal pandemic unemployment benefits approach their end in September, many wonder if they can claim benefits if they are laid off for not getting vaccinated.

A number of companies have begun mandating that their employees get a covid-19 jab including Delta Airlines, Google, Tyson Foods and Walmart, among others. Employees that refuse to comply with the mandate could risk losing their job and will unlikely be able to receive unemployment compensation, despite posts to the contrary on Facebook.

Read our full coverage for more information.

WSJ op-ed calls enhances child tax credit "dangerous"

"The policy—which pays $300 a month for each child under 6 and $250 a month for each child between 6 and 17—is set to expire at year’s end, yet the Biden administration and congressional Democrats are pushing to make it permanent. If that happens, I’m looking at more than $10,000 a year for the next four years, then thousands more annually for nearly a decade after that," writes Nick Stehle for the WSJ.

Do I need this money? Thankfully, no. I have a good job that puts my family solidly in the middle class. Should I be getting this money? Absolutely not. But will I use the money? Yes. That is why this new entitlement is so dangerous."

Stimulus check investment advice

Not everyone needs their stimulus check or child tax credit money for immediate expenses, with many Americans looking to invest the cash boost long term. Success has outlines "3 Smart Money Moves for Your Tax Refund or Stimulus Check"...

Impact of stimulus checks

Marketwatch takes a look at overall impact of stimulus checks on household finances...

"The question is how did COVID-19, with its extensive job losses, roaring stock market, and multiple stimulus checks, affect household balance sheets. While full information about the longer-term impact of the stimulus payments will not be available for a few years, recent research using early data provide some indication of the current state of play."

Democrats seek to extend Child Tax Credit

The Biden administration is trying to extend the expanded Child Tax Credit through to 2025 and permanently keep in place a key provision that helps low-income families.

The one-year expansion of the credit has the potential to cut child poverty by more than 40%, according to the Center on Poverty and Social Policy at Columbia University. Additionally, society is estimated to reap $794 billion in benefits from the one-year expansion, or nearly eight times the $100 billion price to implement it.

Child Tax Credit

August Child Tax Credit: what to do if the payment has not arrived

If you qualify for the credit, and have filed your taxes in the last two years, but still haven't received the money then use these tools to check where your money is:

- check the IRS Child Tax portal, you can track when the IRS sent your payment for both online and mail payments;

- check your bank account - it may sound obvious, but it could be worth checking again. It will appear in your bank account under the name 'IRS TREAS 310.';

- five days after the expected deposit date, which for this month is right now, you can file a trace with the IRS. For domestic mail you can file a trace four weeks after the expected arrival date. You can do this here.

Read more here

Moderate House Democrats call for immediate vote on Senate infrastructure bill 

Democrats hold a slim majority in the House of Representative, they can only lose 3 votes from their members if they want to pass the $3.5 trillion budget resolution next week, in light of unanimous GOP opposition.  Eleven centrists are threatening to vote against their party’s budget proposal according to Politico if the lower chamber doesn’t immediately vote on $1.2 trillion infrastructure bill passed by the Senate. 

Top Democrats are pressuring those centrists to toe the line and stick together. The House is set to return on Monday evening to vote on three bills in unison, the infrastructure bill, the Democrat-only proposal and a voting rights measure.

2021 Child Tax Credit could be a boon for American businesses 

The Child Tax Credit, which was enhanced under the American Rescue Plan, will provide millions of families with monthly payments to help with child-rearing costs. For many low-income families, this will provide a lifeline to pay the bills, cover rent and other basic expenses. But the credit will benefit nearly 90 percent of American children, including those in more well-off families.  

Regardless of income level, it will provide a regular boost to household income and families receiving the money will use it as they see fit. This new cash flow stream could be a boon for businesses that take advantage of the opportunity according to an op-ed by Todd Buchholz and Victoria Buchholz. They write “As every investment banker knows, companies that can boast of reliable ‘recurring revenue’ are worth more than those that cannot."

IRS working on a fix for families that didn’t receive first round of Child Tax Credit payments 

NBC Responds team reports that some taxpayers with Individual Taxpayer Identification Numbers (ITIN) never received their July payment from the 2021 Child Tax Credit. Advance payments on the credit began 15 July, and the second payment went out 13 August. NBC Responds contacted the IRS and was informed that the agency is working on a fix.

The glitch was due to those families “mixed status” where one spouse has a different citizenship or immigration status than the other, but the children are eligible since they have a Social Security Number. 

The agency says that it has “worked expeditiously to correct this issue and these taxpayers will start receiving payments in August. All impacted taxpayers will receive their July payment."

Stimulus checks and Child Tax Credit live updates: welcome

Hello and welcome to our live blog for Thursday, 19 August 2021, bringing you the latest news on a possible fourth stimulus check, and updates on the expanded Child Tax Credit, which saw around 36 million US families receive their second monthly payment at the weekend. We'll also provide information on other economic-aid measures in the United States, such as unemployment benefits and forthcoming changes to food assistance programs.