The second round of stimulus checks could begin in bank accounts soon after President Donald Trump signed the $ 900 billion stimulus bill. Thewas a welcome development for the 6 out of 10 people who had a financial setback due to the pandemic, but millions of people may disappoint themselves if they fall among the groups that do not qualify for the payment.
It is likely that the checks will do this, or 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 that Congress adopted earlier this month and on Sunday night by Mr. Trump is signed.
Mr. Trump and House Speaker Nancy Pelosi have called on lawmakers to increase the amount to $ 2,000 per adult – a request that Wall Street analysts say has little chance of moving forward, given the hundreds of billions of dollars in additional increase in the amount would cost.
In drafting the latest stimulus bill, lawmakers were trying to fix some issues that limited the payment of the first stimulus checks earlier this year. For example, the distribution of the second stimulus checks will include so-called, or families where U.S. citizens are married to immigrants without Green Cards, a group that was unable to receive the checks earlier this year. Children under the age of 17 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 tax in the most recent incentive package differs slightly from the Coronavirus Aid, Relief and Economic Security Act (or the 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 usual with university students.
Below are the groups of people who will not receive a $ 600 check in the second round.
Children who are 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 will phase out the same type of income 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 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 Act.
In general, almost everyone in the bottom 80% of the income distribution in the US 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%.
Of course, even if they do not receive the $ 600 themselves, single people and couples with income above the thresholds will still receive payments for their children, as long as the children are younger than 17.