As the IRS sends out the last of the third round of stimulus checks and tops off payments for millions of other Americans, some lawmakers are already pushing for a fourth check.
The third stimulus payments — worth up to $1,400 per individual and each of his or her dependents — currently being delivered by the IRS will help many families with bills like rent and groceries.
But while finances for many American households are improving, millions are financially struggling more than a year after the first coronavirus-induced shutdowns. Almost 30% of Americans couldn't cover all of their household expenses in late March, according to the latest U.S. Census Bureau data collected March 17-29. About 18 million adults are still going hungry each month.
The continued economic fallout from the pandemic is why a group of 21 Democratic Senators recently sent a letter to President Joe Biden asking him to include recurring direct payments and automatic unemployment insurance extensions in his long-term economic plan.
The lawmakers, including Senate Finance Committee Chair Ron Wyden, D-Ore., and Budget Committee Chair Bernie Sanders, I-Vt., argue that the third stimulus payment, a provision of Biden's $1.9 trillion American Rescue Plan (ARP) signed into law in early March, would not last many cash-strapped families long.
So far, Biden has not indicated publicly that he supports a fourth stimulus payment. For now, the president seems focused on passing his $2 trillion-plus infrastructure plan that aims to improve transportation infrastructure and affordable housing, among other things.
"This crisis is far from over, and families deserve certainty that they can put food on the table and keep a roof over their heads," the Senators wrote in their letter. "Almost 6 in 10 people say the $1,400 payments set to be included in the rescue package will last them less than three months," they said.
Their letter follows a similar overture from some Democratic House members advocating for monthly payments until the economy fully recovers.
Direct payments reach people who need immediate aid
Direct payments, in particular, help those who do not qualify for unemployment insurance but have had their hours reduced or left their job to care for family members during the pandemic, economists have said.
Direct payments have helped alleviate poverty in the U.S., and a fourth stimulus check alone would lift 6.6 million people out poverty in 2021, according to a recent report from Elaine Maag and Kevin Werner at the Urban-Brookings Tax Policy Center.
"Housing instability and food insecurity remain concerns for many, and an additional payment could help with both," Maag writes to CNBC Make It in an email, noting that Black and Hispanic families with children feel the pain more acutely than other households. "Studies on how other economic impact payments were spent indicate people spent the money on necessities like food, housing and bills."
That said, with the vaccine rollout chugging along and more states lifting coronavirus restrictions, it is not clear if the progressive lawmakers will be able to sell the idea to their more moderate or conservative colleagues.
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FILE - This May 8, 2008, file photo shows blank checks on an idle press at the Philadelphia Regional Financial Center, which disburses payments on behalf of federal agencies in Philadelphia. (AP Photo/Matt Rourke, File)AP
As of right now, there are no plans for a fourth stimulus check in 2022. That doesn’t mean efforts for additional financial assistance amid the coronavirus pandemic are done.
A petition calling for $2,000 checks for U.S. adults and $1,000 for children has been signed by 2.97 million people. If it reaches 3 million signatures, the petition will become one of Change.org’s most-signed petitions.
And while that petition has garnered millions of signatures and widespread attention, it appears unlikely it will move Congress to act. Instead, efforts are underway to extend the expanded Child Tax Credit, a measure passed during March’s American Rescue Plan. The child tax pays parents up to $300 a month for children ages 5 and younger and $250 per child age 6-17. The remainder of the money – up to $1,800 – can be claimed when filing 2021 taxes in 2022.
The payments started in July and are set to end in December unless extended by Congress.
The $2.2 trillion Build Back Better bill, passed by the House on Nov. 19 and currently before the U. S. Senate would extend the monthly payments through 2022, short of President Joe Biden’s proposal to stretch them into 2025.
That measure faces an uphill battle.
Passage of the bill requires a simple majority but at least two Democratic Senators, Krysten Sinema of Arizona and Joe Manchin of West Virginia, have expressed concerns about aspects of the bill. If the Senate adjusts or makes amendments to the bill, it would have to return to the House for approval before going to Biden for his signature.
How that will play out remains to be seen and it appears unlikely it will be passed in time for monthly checks to continue uninterruped. The final child tax credit payment is set to begin distribution Dec. 15.
Who will receive stimulus funds in 2022?
Parents who welcomed a child in 2021 could be eligible for additional money in 2022.
The third round of stimulus payments included up to $1,400 per person and came on the heels of $1,200 and $600 checks sent in March 2020 and December 2020, respectively.
According to the IRS, because the third round of stimulus payments was based on information from 2020 or 2019 tax returns, qualifying new parents can claim their $1,400 through the Recovery Rebate Credit when they file their 2021 taxes.
Parents with 2021 newborns are also eligible to receive the child tax credit payment, paid through a lump sum of up to $3,600 when filing taxes.
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