The second round of federal stimulus checks is now picking up bank accounts after President Donald Trump signed the $ 900 billion stimulus bill last week. Last minute the legal aid legislation will modestly increase the 60% of Americans who have suffered financially due to the coronavirus pandemic, but millions of people may be disappointed that they are among the groups that do not qualify for the payment.
The checks will amounts to $ 600 per qualifying adult and child – half the amount of the $ 1,200 checks sent out earlier this year. The payments of $ 600 per person are part of the stimulus bill passed by Congress in December and on the evening of December 27 by Mr. Trump is signed.
Attempts by Mr. Trump and Democratic leaders stuck to increase so-called economic impact payments to $ 2,000 per adult stalled after Senate leader Mitch McConnell in December blocked an attempt to vote on the issue. Wall Street analysts say the pressure has little chance of moving forward, noting the additional hundreds of billions of dollars the larger payment would cost.
In drafting the latest stimulus bill, lawmakers tried to address several issues that limited the payment of first-round checks earlier this year. Checks will, for example, immigrant families with ‘mixed status’ families where American citizens are married to immigrants without green cards – a group that could not receive the checks earlier this year. Children under the age of 17 also receive the same payment of $ 600 as adults, compared to $ 500 in the first round.
“Children are eligible for the same benefit as adults, and families with mixed immigration status with a valid social security number for one spouse are also eligible for the payments, other than the CARES rebates law, “the taxman noted. .
However, the income restrictions in the most recent incentive package differ slightly from those set out in the Coronavirus Aid, Relief and Economic Security (CARES) Act, which will prevent more middle-class families from receiving assistance. And there are some groups that were overlooked in the first check round, who also missed a second check.
The most important among them: child dependents who are 17 years old and adults who are claimed as dependents of another person’s tax return, as is typical with university students.
The IRS said on December 29 that the ‘Get My Payment’ website would be up and running within a few days, enabling consumers to check the status of their payments and update their bank account information. But as of the morning of January 4, the yard was still down.
Below are the groups of people who will not receive a $ 600 check in the second round.
Children dependent on 17 years
The $ 900 billion stimulus package directs $ 600 to every child in a family – as long as they are considered ‘qualifying children’ under the IRS Tax Code for the Child Tax Credit. Unfortunately for parents of older teens, the tax code defines ‘qualifying children’ as those who have not yet had their 17th birthday.
In other words, the $ 600 is aimed at children 16 years or younger.
The IRS will use people’s 2019 tax returns to determine their stimulus payments, meaning teens who achieved their 17th birthday in the second half of 2020 – after tax returns were due to the IRS – could still be eligible.
Adult dependents, from university students to the elderly
According to the Tax Foundation, no adult dependents qualify for the $ 600 checks.
This means that most university students, who are usually claimed by their parents as dependents, do not qualify for the checks. It ranked some college students who expressed their frustration on social media. Many are struggling with a range of problems in the pandemic, from food insecurity to lost income from campus work that has been curtailed due to COVID-19 restrictions.
Older adults, from the elderly to disabled individuals, who are claimed to be addicts, are also excluded, a problem that some on social media call ‘a slap in the face’.
Disabled adults and the elderly who are claimed as dependents often face higher costs due to higher medical expenses.
Single people earning more than $ 87,000
The second round of checks has the same type of income breakdown as in the CARES Act, with the stimulus check payments reduced for earnings of more than $ 75,000 per single person or $ 150,000 per married couple.
The amount individuals receive will be reduced by $ 5 for each $ 100 earned above the threshold, according to the Home Destination Committee.
But the formula, combined with the smaller checkout amount of $ 600, means that the income threshold for receiving money will be lower: single people earning more than $ 87,000 do not qualify – compared to the $ 99,000 phasing-out threshold for single filers. the CARES Act.
Married couples earning more than $ 174,000
For the same reason, married couples will have a lower income threshold for receiving the checks of $ 600. Any couple earning more than $ 174,000 will receive no payment, compared to $ 198,000 in the CARES law.
In general, almost everyone in the bottom 80% of the U.S. income distribution will receive a check, according to the Tax Foundation’s estimate. The tax foundation estimates that the share of applicants who will receive a check is declining for people whose income puts them in the 20% of earnings, with very few taxpayers in the top 5%.