President Joe Biden’s $ 1.9 trillion coronavirus relief plan is moving forward and makes another round of stimulus checks waiting for most Americans. He House approved the bill early Saturday and legislation will now pass the Senate.
In brief comments after the House vote, Mr Biden said he expected a “swift action” from senators on the spending package, dubbed the American Rescue Plan.
“We don’t have time to waste. If we act now, decisively, quickly and boldly, we will finally be able to get ahead of this virus,” he said. “We can finally get our economy moving again. And the people of this country have suffered too much for too long. We need to alleviate that suffering. The American Rescue Plan does exactly that.”
The Senate is likely to adopt the measure next week and will have to iron out the wrinkles that have emerged during the negotiations. The biggest problem is a provision in the House measure that would raise the federal minimum wage to $ 15 an hour by 2025. The Senate bill is unlikely to include the increase after the The Senate MP ruled Thursday that the pay rise cannot be included in the upper house relief plan version.
“We may see some end-of-week attempts by Progressive Democrats to include a pay rise in the current aid bill, but ultimately we don’t see these efforts succeed,” the bank’s analysts wrote. of investment Raymond James in a report.
While the loss of the pay rise is a severe blow to low-income workers, their withdrawal from negotiations in the Senate could effectively accelerate the passage of the bill, according to Heights Security analyst Hunter Hammond .
“This decision, while disappointing for progressives, makes it much easier to calculate the passage of the bill for Democrats,” Hammond told investors in a research note. “They will avoid a tough battle in the Senate, where two Democratic senators oppose a $ 15-per-hour increase (although at least one of them has said it could support a smaller increase), meaning the party it could have been the subject of a brutal fight over the issue. “
The bill would also increase weekly unemployment benefits from $ 300 to $ 400; provide funding for small businesses, schools and cities and states; offer families with children a tax credit; and increase government spending on COVID-19 testing and contact tracking.
The Senate could vote on the package by the end of next week, and the House will cast its final vote on the weekend of March 6 or during the week of March 8, according to Hammond’s forecasts. Lawmakers want to approve the bill before March 14, when the $ 300-per-week extended grant is expected to expire.
Of course, disputes or disagreements could still derail the bill. But Democrats use a process called budget reconciliation to pass legislation, which means only a simple majority in the Senate is needed to pass it, rather than the 60 votes required by most laws to overcome a potential hurdle. In other words, Democrats do not need the support of Republican senators to approve the bailout plan.
IRS Chronology
If the bill is approved on March 12, the Friday before the extra unemployment benefit expires, the incentive checks could start accessing bank accounts from a few days until the following week, depending on the deadline. distribution of the second round of IRS stimulus controls in December.
Earlier this month, the IRS said it was watching the relief bill to prepare to distribute the next round of payments. “We’re looking closely at the hill,” said Ken Corbin, who is primarily responsible for taxpayer experience at the IRS, though he didn’t predict when the tax agency could distribute the checks.
The IRS relies on a taxpayer’s most recent tax return to determine how much they should receive and when they could receive it. That’s why some tax experts are urging taxpayers to do so submit your statements as soon as possible, especially if they had a major change in life, such as the birth of a child or the loss of a job or income last year.
Since the IRS officially began accepting tax returns on February 12 and will close the filing window on the usual April 15 date, the plan could be approved in the middle of the tax filing season.
If a taxpayer does not file their 2020 tax returns before Congress approves their next relief law, the agency is likely to rely on their 2019 tax return to calculate the payment of their check. of stimulus, and that the 2019 statement does not reflect the loss of income during last year’s economic crisis or a new child, for example. In this case, a taxpayer may not receive as much incentive money as he or she is entitled to.
Income limits
A person’s income is the main determinant of whether they will get a check as well as the amount of the payment.
Like the previous two stimulus checks, payments would amount to $ 1,400 for a single person or $ 2,800 for a married couple to file together. But only people who earn up to $ 75,000 would get the full payment, as would married couples with incomes of up to $ 150,000. Payments would decrease for income above these thresholds, eliminating above $ 100,000 for individuals and $ 200,000 for married couples.
Some lawmakers have argued that controls should target lower-income families, citing research that shows higher-income families are recovering from the economic impact of the pandemic. But other research indicates widespread financial pain across the country, with ranks of adults experiencing financial difficulties last month little changed since December, according to economist John Leer of Morning Consult.
A third round of $ 1,400 checks would allow nearly 23 million adults to pay their expenses for more than four months without getting into debt or eating up their savings, the analysis found.
“This third stimulus control is absolutely vital,” Credit Karma CEO Colleen McCreary told CBS MoneyWatch. “I don’t see a world where people have their financial base with no extra money to stimulate.”