The second round of stimulus checks may soon begin to reach bank accounts after President Donald Trump signed the $ 900 billion stimulus bill. O last minute subscription it was a welcome development for 6 out of 10 people who suffered a financial setback due to the pandemic, but millions of people may be disappointed if they are among the groups that do not qualify for payment.
Checks are more likely adds up to $ 600 for each adult and child, or half the value of the $ 1,200 checks sent earlier this year. The $ 600 per person payments are part of the stimulus bill approved by Congress earlier this month and signed by Trump on Sunday night.
Still, Trump and House Speaker Nancy Pelosi asked lawmakers to raise the amount to $ 2,000 per adult – a request that Wall Street analysts say has a small chance of moving forward, considering the hundreds of billions of dollars. in such an increase the amount would cost.
In drafting the latest stimulus bill, lawmakers sought to rectify some issues that restricted payment of the first stimulus checks earlier this year. For example, the distribution of checks for the second stimulus will include so-called immigrant families of “mixed status”, or families where American citizens are married to immigrants without Green Cards, a group that was barred from receiving checks earlier this year. Children under 17 will receive the same $ 600 pay as adults, compared to $ 500 in the first round.
“Children will be entitled to the same benefit amount as qualified adults, and families with members of mixed immigration status with a valid Social Security number for one of the spouses are also eligible for payments, unlike discounts under the CARES Act” , noted the Tax Foundation.
However, the income limits in the most recent stimulus package are slightly different from the Aid, Aid and Economic Security Coronavirus Act (or CARES Act), which will prevent more middle-class families from receiving aid. And there are some groups that were overlooked in the first round of checks that will also lose a second.
The main among them: Dependent children of 17 years old and adults declared as dependents in another person’s income tax return, as is the case with university students.
Below are the groups of people who will not receive a check for $ 600 in the second round.
Child dependents aged 17
The $ 900 billion stimulus package directs $ 600 for each child in a family – provided they are considered “qualified children” under the IRS tax code for the Child Tax Credit. Unfortunately for parents of older teenagers, the tax code defines “qualified children” as those who are not yet 17 years old.
In other words, the $ 600 will go to children under 16.
The IRS will use people’s 2019 tax returns to determine their stimulus payments, meaning that teenagers who turned 17 in the second half of 2020 – after tax returns were due to the IRS – can still qualify.
Adult dependents, from university students to the elderly
No dependent adults will be entitled to checks for $ 600, according to the Tax Foundation.
This means that most college students, who are usually declared dependent by their parents, do not qualify for checks. This angered some college students, who expressed their frustration on social media. Many are battling a range of problems in the pandemic, from food insecurity to lost income from campus jobs that have been reduced due to COVID-19 restrictions.
Also excluded are the elderly, from the elderly to people with disabilities, declared as dependents, an issue that some on social networks called “slap in the face”.
Disabled adults and elderly people who are claimed as dependents often face higher costs due to issues like higher medical expenses.
Single people earning more than $ 87,000
The second round of checks will have the same type of revenue elimination as in the CARES Act, with payments of stimulus checks reduced to earnings above $ 75,000 per single person or $ 150,000 per couple.
The amount of payment that individuals receive will be reduced by $ 5 for every $ 100 of income earned over these limits, according to the House’s appropriations committee.
But this formula, when combined with the lower $ 600 of checks, means that the income limit for receiving any money will be lower: singles earning more than $ 87,000 do not qualify – compared to the $ 99,000 elimination limit for unique users under the CARES Act.
Couples earning more than $ 174,000
For a similar reason, couples will face a lower income limit to receive checks for $ 600. Any couple who earn more than $ 174,000 will not receive a payment, below $ 198,000 under the CARES Act.
Overall, almost all of the poorest 80% of the US income distribution will receive a check, according to the Tax Foundation estimate. The share of architects who will receive a check decreases for people whose income puts them in the top 20% of the highest paid, with very few contributors among the top 5%, estimated the Tax Foundation.
Of course, even if they do not receive the $ 600 themselves, single people and couples with income above these limits will still receive payments for their children, as long as those children are under 17 years old.