How the $1,200 stimulus checks in the HEALS Act could differ from the first payments - CNBC

guduka.blogspot.com

Senate Majority Leader Mitch McConnell, R-Ky., leaves the Senate Republican Policy luncheon in Hart Building on Tuesday, July 21, 2020.

Tom Williams | CQ-Roll Call, Inc. | Getty Images

A second round of $1,200 stimulus checks could be coming, thanks to Senate Republicans' new stimulus proposal.

The terms of the new payments were outlined in the HEALS Act introduced by Senate Majority Leader Mitch McConnell, R-Ky., on Monday. Democrats also called for another round of $1,200 payments in their HEROES Act that was passed by the House in May.

The second set of stimulus checks is one issue both sides of the aisle seem to agree on, as they work to compromise on other items such as expanded unemployment, more government Paycheck Protection Programs loans to small businesses and aid to help schools reopen.

"This is an area, sort of an exception here, where there is broad understanding for the need for these payments," Garrett Watson, senior policy analyst at the Tax Foundation, said of the stimulus payments.

Much of the size of the payments and scope of who will be eligible is the same in the Republicans' proposal as the first set of payments authorized by the CARES Act this spring.

"It's on the little details that things have changed," said Janet Holtzblatt, senior fellow at the Urban-Brookings Tax Policy Center.

Amounts and phase outs

The amount of the payments and the income thresholds to qualify under the HEALS Act is the same as the first stimulus package.

Individuals stand to receive up to $1,200 and married couples could get up to $2,400, plus $500 per eligible dependent.

Individuals with adjusted gross income of up to $75,000 would be eligible for full payments. Checks would be reduced for those making over that amount and would phase out completely for income over $99,000.

Heads of household could be eligible for full payments for up to $112,500 in income and would phase out completely for those making over $136,500.

Married couples who file jointly who take in up to $150,000 would be eligible for full payments, though those making more than $198,000 would not get checks.

As with the first round of money, those who are already receiving federal support — Social Security, Supplemental Security Income, VA or Railroad Retirement benefits — would also qualify.

Like the first payments, the checks will not increase how much you owe or reduce your refund next tax season.

More dependents eligible

A participant holding a sign at the protest.

Erik McGregor | Getty Images

Unlike the first stimulus checks, where only children under age 17 were eligible for $500 dependent payments, the Republicans are calling for including all dependents in families who qualify.

That means that children 17 and over, including college students, and adults who are disabled or otherwise claimed as dependents on someone else's tax return, would be eligible.

This change mirrors the Democrats' plan, which also called for including all dependents. But the Democrats' plan included bigger payments of $1,200, instead of $500, for a maximum of three dependents per household.

The draft of the Republican plan does not put a cap on the number of dependents per family. The change would make at least 26 million people eligible for the money, according to an estimate from the Tax Foundation.

Of note, the Republicans are calling for the change to apply just to the second stimulus payments, and would not be retroactive to the first checks sent out.

Non-citizens still ineligible

rmbarricarte

While the Democrats had called for making non-citizens eligible for both the first and second stimulus checks, the Republicans did not.

Specifically, those who do not have Social Security numbers or who are nonresident aliens are excluded from receiving payments. The one exception is for certain resident aliens, provided they hold that status as of 2020 and have valid Social Security numbers.

One sticking point has been whether Americans who are married to non-citizens (those who file with Individual Taxpayer Identification Numbers), and who file their tax returns jointly, should be eligible for stimulus payments. Under the CARES Act, those individuals and their dependents were shut out.

One proposal by Sen. Marco Rubio, R-Fla., called for making Americans who are married to non-citizens eligible for the money. That would also include their children, provided they are American citizens.

"This might be an area where Democrats might push back," Watson said. "If there was going to be a change, that would the first place to start."

Rules for debtors

Getty Images

The Republican plan protects the stimulus checks from federal or state debt collection, as well as bank garnishment.

The one exception would be unpaid child support.

This change would not be retroactive to the first set of payments, according to the Republican plan.

But it could provide more clarity for banks and other financial institutions now that there is guidance to follow, Watson said.

Restrictions for dead people and prisoners

Anyone who died prior to Jan. 1, 2020 would not be eligible for a stimulus payment, according to the Republican plan.

The Treasury Department has said that the heirs of people who died before they received the money were not eligible to keep it. One outstanding question is how the agency would apply the new rule, if enacted, Holtzblatt said.

Prisoners would also largely be shut out from receiving any money if they are imprisoned at the time the payment is made or are incarcerated throughout 2020.

Both of these changes would apply retroactively to the first stimulus payments.

Trump's signature stands

U.S. President Donald Trump's name appears on the coronavirus economic assistance checks that were sent to citizens across the country April 29, 2020 in Washington, DC.

Chip Somodevilla | Getty Images

President Donald Trump's signature was featured prominently on the first set of paper checks. The Democrats called for leaving that off the second round of payments in the legislation passed by the House.

That change was not included in the Senate Republican plan, Holtzblatt noted.

"That was a very pointed aspect of the HEROES Act," Holtzblatt said.

(Correction: An earlier version of this story misidentified the party affiliation for Sen. Marco Rubio.)

Let's block ads! (Why?)

"payment" - Google News
July 29, 2020 at 02:20AM
https://ift.tt/2DaaFp8

How the $1,200 stimulus checks in the HEALS Act could differ from the first payments - CNBC
"payment" - Google News
https://ift.tt/3bV4HFe
https://ift.tt/2VYfp89

Bagikan Berita Ini

Search