by Maurie Backman | Updated July 25, 2021 - First published on March 3, 2021
Many or all of the products here are from our partners. We may earn a commission from offers on this page. It’s how we make money. But our editorial integrity ensures our experts’ opinions aren’t influenced by compensation. Terms may apply to offers listed on this page.
After calls for more targeted aid, President Biden is on board with lower thresholds for upcoming stimulus eligibility.
President Joe Biden has sought to quickly provide meaningful aid to help people cope with the financial impact of the coronavirus pandemic. His $1.9 trillion stimulus proposal has already made it through a House vote, and needs Senate approval to move forward. But that bill isn't yet set in stone, and one change now on the table is setting lower income thresholds for stimulus eligibility.
Tips and tricks from the experts delivered straight to your inbox that could help you save thousands of dollars. Sign up now for free access to our Personal Finance Boot Camp.
By submitting your email address, you consent to us sending you money tips along with products and services that we think might interest you. You can unsubscribe at any time. Please read our Privacy Statement and Terms & Conditions.
The aforementioned $1.9 trillion relief package includes a third stimulus round, this time featuring payments of $1,400 -- the most generous stimulus number to date. But some lawmakers have expressed concern that the president's proposed aid isn't targeted enough. These lawmakers don't want to see stimulus cash land in the bank accounts of well-off families who don't necessarily need that money to pay for essentials. They want to direct the money to the nation's neediest.
In the first two stimulus rounds, individuals earning $75,000 or less, heads of household earning $112,500 or less, and married couples earning $150,000 or less received a full payment. From there, those payments phased out, so some higher earners still ended up with some amount of stimulus cash.
For the upcoming round, the initial thresholds are the same -- individuals earning $75,000 or less, heads of household earning $112,500 or less, and married couples earning $150,000 or less receive a full $1,400 payment. But beyond that, things get tricky.
In the House bill that recently passed, stimulus checks get cut off entirely at the following income thresholds:
But Biden is now on board with a plan to lower the thresholds at which stimulus payments are cut off completely. As of now, here are the new cutoff thresholds:
Under this plan, a lot of people who received stimulus funds under the first two rounds are not eligible in the third round. It's also worth noting that this is a major compromise on Biden's part. In recent weeks, he's received pressure to make his upcoming aid package more targeted, especially in light of a declining U.S. unemployment rate. In fact, recently, the U.S. Chamber of Commerce warned that the president's plan was too generous, and that overspending on a stimulus package would leave less money for important initiatives like infrastructure.
Of course, news of tighter eligibility may not sit well with higher earners who were, until now, looking forward to a third stimulus check. Ultimately, these lower thresholds should help ensure that those $1,400 payments go to households who need the money most.
If you have credit card debt, transferring it to this top balance transfer card secures you a 0% intro APR into 2023! Plus, you’ll pay no annual fee. Those are just a few reasons why our experts rate this card as a top pick to help get control of your debt. Read The Ascent's 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.