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$600 Pandemic Relief Payments Are Being Sent to Bank Accounts

Economy Dec 29, 2020 08:09PM ET
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© Reuters. $600 Pandemic Relief Payments Are Being Sent to Bank Accounts

(Bloomberg) -- The Internal Revenue Service began sending $600 stimulus payments to eligible Americans’ bank accounts on Tuesday evening and will continue processing the transfers into next week, according to a statement from the agency.

The IRS and Treasury Department will start mailing paper checks on Wednesday. The $600 payments will go to many low- and middle- income adults. Dependent children ages 16 and under in those households are also eligible for $600 each.

“These payments may begin to arrive in some accounts by direct deposit as early as tonight,” Treasury Secretary Steven Mnuchin wrote on Twitter Tuesday.

“The IRS emphasizes that there is no action required by eligible individuals to receive this second payment,” the IRS said in a statement on Tuesday evening. “Some Americans may see the direct deposit payments as pending or as provisional payments in their accounts before the official payment date of Jan. 4, 2021.”

The IRS is beginning to send the payments just two days after President Donald Trump signed the $2.3 trillion government funding and coronavirus relief package into law. The relief measures include a second round of direct payments as an attempt to bolster consumer spending and disposable income, which have fallen in recent weeks amid surges in Covid-19 cases, hospitalizations and deaths, and new restrictions by cities and states.

Congress approved an initial round of $1,200 payments in March.

Most individuals will be paid through direct deposit, but some will receive a paper check or a prepaid debit card. Social Security, Veterans Affairs and Railroad Retirement beneficiaries who received their payments on Direct Express benefits cards during the first round, will also receive them that way this time.

Individuals earning as much as $75,000 would receive $600; married couples collectively making less than $150,000 would get $1,200, plus an additional $600 for each dependent child. Those amounts would be reduced by $5 for every $100 earned above the income threshold, which means that people earning more than $87,000 as an individual or $174,000 as a couple get nothing.

If the Internal Revenue Service issues individuals more than they are supposed to receive, they do not have to pay back the excess amount. The government is not allowed to reclaim the payments to pay back federal or state debts, and banks are forbidden from garnishing them.

Individuals who do not receive their full payment can claim the additional amount on the tax returns they file this spring.

The House passed legislation Monday that would increase the payments to $2,000, a request Trump made after Congress had passed the economic relief bill. Republicans blocked a request to consider the bill in the Senate Tuesday, stalling the legislation. However, if the higher payment amount is approved, the IRS said it would send a separate payment to top up the initial transfer “as quickly as possible.”

©2020 Bloomberg L.P.

$600 Pandemic Relief Payments Are Being Sent to Bank Accounts
 

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