by Maurie Backman | Feb. 10, 2021
An analysis shows that even with lowered eligibility thresholds, most Americans will still be in line for a third stimulus check.
Millions of Americans have lost their jobs or seen their incomes decline during the coronavirus pandemic, and many have depleted their savings as a result. That's why President Joe Biden wants to put a generous third stimulus check into Americans' bank accounts.
On Feb. 8, House Democrats introduced a proposal for $1,400 stimulus checks for individuals earning $75,000 or less, heads of household earning $112,500 or less, and married couples earning $150,000 or less. That $1,400 would be per-person, so couples would be in line for $2,800.
Republican lawmakers, meanwhile, have expressed opposition to this plan, arguing that additional stimulus money should only go to the people they say need it most. They've asked Democrats to reduce the income thresholds for stimulus eligibility, and Democrats have agreed to a compromise. But even with that compromise in place, the bulk of Americans will receive stimulus money.
While the aforementioned income thresholds for stimulus eligibility are unchanged from previous rounds, Democrats have agreed to cut off checks entirely for individuals earning $100,000 or more, heads of household earning $150,000 or more, and married couples earning $200,000 or more. In previous rounds, stimulus payments phased out for earners above these thresholds, but were not off the table from the get-go.
Most Americans will still be eligible for stimulus payments even with this compromise in place. Kyle Pomerleau, a tax policy specialist at the American Enterprise Institute, says that about 84% will receive a full stimulus payment, and another 6.8% will receive a partial payment under this system, as The Washington Post reports.
By contrast, under Biden's initial proposal, the same 84% of Americans would be entitled to full stimulus payments, while 8.5% would get partial payments. The compromise does relatively little to whittle down the number of recipients.
For stimulus checks to reach the public, Congress needs to pass Biden's broad coronavirus relief package. The Senate and House have taken steps to move that proposal forward by approving a budget resolution. Lawmakers are eager to finalize that legislation before mid-March, because that's when extended jobless benefits are set to expire under the last relief bill.
Biden proposes extending boosted unemployment benefits through the end of September. Currently, those collecting jobless benefits are getting a $300 weekly bump, but Biden wants to increase that to $400. It's estimated that doing so will help the average person who's out of work replace 86% of lost wages.
The good news is that once legislation is signed, stimulus checks could go out very quickly, and those with bank account details on file with the IRS could see their money in days. And based on the data above, it's clear that a lot of people will be in line for that money.
If you have credit card debt, transferring it to this top balance transfer card can allow you to pay 0% interest for a whopping 18 months! That’s one reason our experts rate this card as a top pick to help get control of your debt. It’ll allow you to pay 0% interest on both balance transfers and new purchases until 2022, and you’ll pay no annual fee. Read our full review for free and apply in just 2 minutes.
We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.
The Ascent is a Motley Fool service that rates and reviews essential products for your everyday money matters.
Copyright © 2018 - 2021 The Ascent. All rights reserved.