(CBS Detroit) – A third check of the stimulus seems to increase more and more with each passing day. As the economic rate of the ongoing COVID pandemic continues to rise, President Joe Biden and politicians on both sides of the aisle support putting more money in Americans’ pockets as soon as possible. Although an aid payment seems likely, as well as when they remain in question.
A $ 1,400 stimulus check is part of the $ 1.9 trillion aid package proposed by the Biden administration. The US rescue plan, in its current form, would also include more unemployment benefits, an improved tax credit for children and additional aid for millions of Americans in serious economic situations due to the ongoing COVID-19 pandemic. Democrats control both chambers of Congress and have signaled a desire to pass stimulus legislation on direct party voting, if necessary. They also paved the way for budget reconciliation, which would allow them to bypass the Senate filibuster and pass incentives with a simple majority.
RELATED: Stimulus Check Latest: Has the timeline for another financial aid payment been shortened?
The $ 1,400 that has received so much attention seems destined to come true. But the actual amount that reaches people’s bank accounts may change depending on the income threshold, the number of dependents and other factors.
Last week, a group of 10 Republicans in the Senate submitted a $ 618 billion counter-offer to the American Rescue Plan. Their package will reduce direct payment to $ 1,000 and limit annual revenue for beneficiaries to $ 40,000, after which the value of the incentive check would gradually decrease to $ 0. At the end of last week, the president rejected the idea of reducing the amount. “I’m not reducing the size of the checks,” Biden said Friday. “It will be $ 1,400, period. That’s what the American people were promised. “
However, the idea of reducing the annual income requirement has gathered some steam.
The last two incentive checks have been phased out for people with an adjusted gross income (AGI) of more than $ 75,000 per year and married couples with an AGI of more than $ 150,000. (AGI represents total wages, interest, dividends, alimony, distribution of pensions, and other sources of income less certain deductions, such as student loan interest, alimony payments, and pension contributions.) For each dollar of income above the threshold, the previous amount two incentive payments fell by five percent. Thus, the $ 1,200 payment under the CARES Act amounts to $ 0 for income over $ 99,000 ($ 198,000), and the $ 600 in the second incentive has dropped to $ 0 for income over $ 87,000 ( $ 174,000).
The Biden administration is considering lowering its income threshold to $ 50,000 ($ 100,000). Assuming the same five percent formula, a $ 1,400 ($ 2,800) payment would actually be $ 700 ($ 1,400) with an annual income of $ 64,000 ($ 128,000) and $ 0 with an annual income of $ 78,000 ($ 156,000). ).
The thinking behind this type of change is to make sure that more money is spent in a larger economy than is saved. According to a survey conducted by the Federal Reserve Bank of New York, the average percentage of the first stimulus payment that a household spends on essential products decreased with increasing income. The average percentage of the first stimulus payment that a household saved increased with increasing income. While lowering the income threshold would better target the economy, it would also reduce the number of people receiving a third incentive check and the amount received by others.
RELATED: Latest Stimulus Check: Will the $ 1,400 payment survive the US rescue plan negotiations?
A recent democratic proposal kept the income threshold at $ 75,000 ($ 150,000) and set the upper limit at $ 100,000 ($ 200,000). According to this configuration, an amount of 1,400 USD (28,000 USD), as revenues increased to 100,000 USD (200,000 USD). The problem remains very undecided.
Dependent children could also affect the size of the next stimulus check. The second stimulus check included $ 600 for each dependent child. A dependent child has been defined as anyone under the age of 17 living in your household. There was no limit to the number of children. And for the purpose of phasing out, $ 600 was added to the adult total. For example, an adult with two children would receive $ 1,800 in January if her AGI were below $ 75,000. That amount would have dropped to $ 1,200 at an AGI of $ 87,000; $ 600 for a $ 99,000 AGI and $ 0 for a $ 111,000 AGI.
The American Rescue Plan aims to expand the group of eligible people into maintenance to include people over the age of 16. In this group would be students and older adults with certain types of disabilities. Such a change could make about 13.5 million people eligible for incentive checks.
The value of a third incentive check could also be affected by the recipient’s taxes. To speed up distribution, the Internal Revenue Service used the latest tax records to determine the AGI and therefore eligibility. AGI changes from year to year, as people receive increases, change jobs or become unemployed. The first exemption payment was adopted in March 2020. At that time, some people filed their taxes for 2019 and others did not. So the amount of the check could have been based on 2018 or 2019 taxes. The second exemption payment became law in December 2020, after most everyone filed their 2019 taxes. So that amount was determined by the records. fiscal year 2019.
The third exemption payment could be signed by mid-March 2021. At that time, some people will be taxed by 2020. Others will not. This means that a third payment could be based on taxes in 2019 or 2020. Last year saw significant unemployment, which often harms the finances of individual households. If the AGI changes significantly from one tax record to another, the value of the next incentive check could also increase.
When can the third stimulus control arrive? The administration’s goal is to sign the U.S. Rescue Plan by March 14. This is also the time when the current $ 300 federal unemployment benefit bonus expires. Assuming that President Biden is able to sign the aid package on March 14, direct deposits would probably start in the week of March 22, and checks start arriving in the week of March 29.
However, the President of the Chamber, Nancy Pelosi, seems to have an even more aggressive chronology. According to comments made last Friday, it aims to promote the US Rescue Plan in two weeks. The Senate will then be able to vote directly on the party line. In this scenario, the stimulus package could go through Congress by February 26 and could be signed into law on March 1. Direct deposits would begin to arrive in bank accounts by March 8, and checks would begin to be mailed on March 15. , because of the ongoing removal process in the Senate or some other reason.
MORE: Stimulus Check Latest: Parents could receive monthly payments with an extended tax credit for children
Originally posted at 2:46 PM ET ET on Thursday, February 11, 2021.