Treasury Secretary Steven Mnuchin said that $600 stimulus checks will arrive as fast as next week.
AFP via Getty Images[Updated at 6:20pm on Dec 21 with additional information from Representative Kevin Brady]
Congressional leaders announced yesterday evening that a stimulus agreement has been reached and will be voted on today. That is welcome, if belated, news for millions of Americans and businesses who have struggled financially under the weight of the coronavirus pandemic. The text of the bill has not been published yet, but based on draft language released yesterday, $600 stimulus checks for eligible Americans and dependents are included as part of the stimulus package.
For those who have been waiting for additional relief in the form of a second stimulus check, one question may be top of mind: when will I get the money?
Mnuchin Says $600 Stimulus Checks To Arrive Beginning Next Week
Treasury Secretary Steve Mnuchin said that stimulus checks will start to go out next week. "People are going to see this money at the beginning of next week. It's very fast,” Mnuchin said on CNBC this morning. "I expect we'll get the money out by the beginning of next week."
If distribution follows the first stimulus check, which was disbursed as part of the Cares Act, then payments will be sequences. The first round of payments will go to those for whom the IRS has bank account details on file and can remit funds via direct deposit. Even better, most Americans won’t have to take any additional action to receive their $600 check. The IRS will use information from their 2019 or 2018 tax return to facilitate payment.
Mnuchin had signaled an aggressive rollout this summer, saying that he could start processing the economic impact payments as soon as legislation is passed, which could be as early as today. “I can get out 50 million payments really quickly. A lot of it into people’s direct accounts,” Mnuchin previously said in August.
If the time table holds, this will be even faster than the $1,200 stimulus checks that were part of the Cares Act. President Trump signed the CARES Act on March 27 and the first checks started hitting American’s bank accounts the week of April 14. Within the first two weeks, more than 81 million payments, totally over $147 billion, were disbursed through electronic transfers to recipients’ bank accounts, according to the Government Accountability Office (GAO).
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“This is a very, very fast way of getting money into the economy,” Mnuchin said. “Much needed relief — and just in time for the holidays.”
Paper Checks May Start Faster, But May Face Capacity Constraint
Other recipients may have to wait longer to see their stimulus check, which will arrive via paper check or prepaid debit card via U.S. mail. However, given that the IRS already has the infrastructure in place, and if the criteria for stimulus check eligibility remain the same, it may be able to start initiating other payments quicker.
If the IRS and Treasury follow the same sequencing as during the Cares Act distribution, paper checks will be mailed out starting with the lowest-income earners, individuals making less than $10,000, and then working up to higher earners. According to the GAO, the Treasury Department has the capacity to disburse between five and seven million paper checks in a given week, on top of checks that it sends out as part of other programs. This means that there may be a capacity constraint for paper checks that may slow down distribution, regardless of how quickly payments start. However, Representative Kevin Brady (R-Texas) indicated Monday evening that paper checks and debit card payments will start to go out January 1, 2021 “at 10 million per week.”
For the first round of stimulus payments, the IRS started mailing paper checks the week of April 24 and didn’t finish until the middle of September for higher earners. Brady also indicated that he expected “all payments by 1-15,” which would indicated a more aggressive distribution plan.
The Upshot:
Stimulus checks will start to hit American’s bank accounts next week for those with direct deposit. If the IRS doesn’t have direct deposit information for you, it will take longer to receive a paper check.
"The president wanted direct payments, so we will be sending out next week direct deposit,” Mnuchin said. “I suspect we'll get the money out by the beginning of next week: $2,400 for a family of four, so much needed relief." Millions of Americans would agree.
The Link LonkDecember 22, 2020 at 12:06AM
https://www.forbes.com/sites/shaharziv/2020/12/21/irs-to-send-out-stimulus-checks-faster-this-time-600-per-person-could-go-out-to-bank-accounts-next-week/
IRS To Send Out Stimulus Checks Faster This Time; $600 Per Person Could Go Out To Bank Accounts Next Week - Forbes
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