By David Lawder
WASHINGTON (Reuters) – With much practice in sending coronavirus aid payments to Americans, the federal government could launch the delivery of $ 1400 checks almost immediately once Congress completes the new bill and President Joe Biden signs it, tax experts say.
Some Americans may see direct payments if this bill passes the House of Representatives on Tuesday, as expected, compared to a few weeks behind in April 2020. It is expected that nearly 160 million households will receive payments, the White House estimates.
However, the Ministry of Treasury’s Internal Revenue Service will face new challenges, thanks to the $ 1.9 billion relief bill. Prisoners, those with non-civilian spouses and relatives of those who died in 2020 will be eligible for payments.
The bill also includes an extended child tax credit of up to $ 3,000 per child, paid monthly from July, forcing the income collector to act as benefit administrator for the rest of the year.
The IRS, which has more than 70,000 employees, handles more than 190 million individual and corporate tax returns a year, but this has been hampered in recent years by budget cuts and outdated technology. The COVID-19 bill contains $ 1.46 billion for the agency, which is in its busiest season, as the deadline for individual taxpayers approaches April 15.
A U.S. Treasury spokesman said the government’s Biden priority was to expedite relief to Americans, adding: “The Treasury is ready to implement the direct payments program once the U.S. bailout plan is passed. . ‘
FINDING OF UNCLOSED
One-time payments to those who file tax returns regularly should not be a struggle for the IRS, said Janet Holtzblatt, a senior fellow at the Urban-Brookings Tax Policy Center.
“They’ve already ironed out a lot of the snafus that delayed previous implementations,” Holtzblatt said. “The IRS continues to amaze me with its ability to meet these challenges.”
It took more than two weeks before the IRS began sending the first $ 1,200 electronic payments to taxpayers in April 2020, after then-President Donald Trump signed the $ 2.2 billion CARES law into law on March 27. There was more than a three-week delay for paper checks, after changes were made to put Trump’s name on it.
The $ 900 billion stimulus at the end of the year was signed by Trump on December 27, a week after Congress passed it. The IRS began sending out electronic payments two days later, on December 29th.
Biden left the IRS ample room for the Senate on Saturday, saying his plan “would get checks at the door this month.”
But Democrats in Congress, including Senator Bob Casey, were more optimistic Sunday. Payments will go out in very short order, Casey said. “The treasury department has been prepared for that. They have been dealing with the issue since March.”
Another key priority for the next round is to enroll more people for electronic payments, including those who earn too little to file tax returns or who do not receive other federal benefits that were not left in previous payment rounds.
Homeless people and people who do not have access to the internet will be difficult to reach, but Holtzblatt said community outreach groups that were shut down last year due to the coronavirus could now help them sign up.
Tax credits are a big business, tax experts say. All taxpayers who earn less than $ 200,000 with children aged 17 and under at least half of the year can claim the full credit.
Biden’s account increases the credit to $ 3,000 per child from $ 2,000 and allows it to be paid in advance for all income levels, as monthly cash payments from July to December of this year.
Nina Olson, executive director of the Center for Taxpayer Rights in Washington and the IRS’s national advocate for taxpayers from 2001 to 2019, said an important challenge would be to determine whether the children do live with their parents, what the payments are. can prevent.
The IRS must also change its culture to reflect a changing mission, she said.
“The IRS must realize that it is not just a revenue collector, but that it is a social benefits manager, and that it must staff itself and organize its training accordingly,” Olson said.
(Reporting by David Lawder, Additional Reporting by Andrea Shalal; Editing by Heather Timmons and Peter Cooney)