US Secretary of the Treasury Steve Mnuchin speaks while US president Donald Trump listens during the … [+]
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Topline: Americans will receive direct deposits from the government as part of the coronavirus stimulus package beginning next week, Treasury Secretary Steve Mnuchin told House lawmakers Wednesday, an encouraging sign for millions of citizens who have been anxiously awaiting relief from the punishing economic toll of the virus outbreak.
- Lawmakers have been pressing the federal government for answers as to how and when it would distribute the cash payments, which amount to one-time $1200 payments for most American adults, ever since Congress hastily passed the $2 trillion aid package last month.
- Mnuchin’s comments, which were first reported by the Associated Press, were delivered during a conference call with House Democrats and the White House coronavirus task force.
- Some 60 million Americans who gave their direct deposit information to the I.R.S. in their 2018 or 2019 tax returns will get their money next week.
- However, those who have not handed over their direct deposit information will not receive checks in the mail until as late as August, Mnuchin recently admitted.
- The payments come as the coronavirus outbreak has shut down an estimated 29% of the U.S. economy and led more than 10 million Americans to claim unemployment benefits.
Key background: Under the bill, most American adults will receive a one-time direct deposit payment of $1,200 each, and $500 per child (couples will receive $2,400).
The payments will begin to reduce, however, for individuals making over $75,000 (the reduction begins at $112,500 for heads of household and $150,000 for married couples) at a rate of $5 for every $100 in additional income.
The payments cut out completely for individuals making over $99,000 (it cuts out at $146,500 for head of household filers with one child, and at $198,000 for couples with no children.)
Further reading: Forbes’ contributor Richard Harroch explains how Americans can get the stimulus aid money deposited into their bank accounts.
Those who haven’t given over their direct deposit information will need to file a 2018 or 2019 return electronically with the I.R.S., he says.
Big number: Around 175 million Americans will receive money from the government under the $2 trillion aid package, White House economic adviser Larry Kudlow said this week.
What we don’t know: Whether Congress will pass another stimulus bill with more cash payments to Americans. Democratic lawmakers in the House and Senate are pushing hard for a follow-up stimulus bill to the $2 trillion aid package but a vote is unlikely before the end of the month, reports Forbes colleague Sarah Hansen.