The federal stimulus check was a huge exercise in supporting citizens in the face of an emergency. In this particular case, the pandemic shut down the economy for months and meant a sudden end to all forms of income, mainly for low and moderate-income Americans.
Over 476 million payments with a total sum of $814 billion in financial relief reached households impacted by the ravages of the pandemic. While we have heard of them and referred to as the stimulus check, the Economic Impact Payments were the most direct bank transfer of federal aid following the economic downturn due to the pandemic. The Internal Revenue Service based the amount that individuals received as income tax filers received on income and the number of children and other qualifying dependents, such as a parent.
The federal stimulus checks were generous and supported Americans throughout the pandemic. The third round of the Economic Impact Payment.
While the first two rounds brought in $1,200 and $600 in April 2020 and January 2021, the third round can in immediately after the third in March 2021. The third round of $1,400 was the more generous not only for the stimulus check as it sent out billions to organizations, businesses, and local and state government.
These later amounts proved to be a lifesaver even as the nation was gripped by an economic downturn that lasted till the second quarter of 2021. 2022 started with a different form of challenge for Americans as the price of every product and service began to rise at a rapid pace, after the shooting of the pandemic and its economic ravages. With the federal government trapped in the political machinations of Washington, states stepped in.
Over fifty million Americans received some form of tax refund. It started as a trickle as some states realized early on that the unchallenged rise of prices would overwhelm Americans. But by the end of 2022, over twenty states had stepped in with various forms of tax rates and payments.
Most payments went out as tax rebates though a few states stuck to the regular check, direct bank deposit, and pre-paid debit cards. But as with the federal check, many potential beneficiaries did not get a stimulus check for various reasons.
The federal stimulus check was plagued by mistakes in distribution even as the IRS grappled with the problem of reaching out to the low-income group, the people who deserved the stimulus check the most.
The data available with the tax agency had a major shortcoming as it was limited to the people who file their income tax returns. Many Americans have a gross income less than the filing thresholds. And it gets higher for citizens above sixty-five years.
Even as late as the last quarter of 2022, the authorities acknowledged that close to ten million Americans were yet to receive the third stimulus check, the Earned Income Tax Credit, the Child Tax Credit stimulus check, and other aids announced by the stimulus check.
The tax authorities finally reached out to such families and individuals and instructed them to file a simplified income tax return to collect their payments. The amount ran into thousands of dollars for a family of four.
The Child Tax Credit Stimulus Check
The federal government made three direct COVID-19 stimulus payments to individuals and families between April 2020 and December 201. The total payment finally added up to $931 billion. Around 165 million Americans benefitted from these payments. Any Americans with an income below $75,000 and married couples with an AGi double that for individuals were eligible for the full amount of the three rounds of stimulus checks.
The temporary expansion of the Child Tax Credit stimulus check also helped out families even as the stimulus checks ended with the third round in March 2021.
The expanded CTC stimulus check support families for the last two quarters of 2021 and also in the first quarter of 2022 when Americans received the other fifty percent of the amount after the first half was given in six monthly checks.
Millions of families with children have already received some form of the Child Tax Credit. Around 84% of American children benefitted from this largesse. The CTC payment was the most successful of the stimulus checks as it had a direct bearing on child poverty in the US.
the amount went directly into the bank accounts of parents whose records were with the tax authorities. Records with both the Federal Reserve and the Census Bureau reveal that advance CTC payments and COVID stimulus reduced financial hardship and food insufficiency among recipients.
Individuals and families still can file a tax return and claim their pending stimulus checks and other federal support given during the pandemic.
Getting The Word Out To People Who Missed Their Stimulus Check
The IRS undertook some sweeping outsourcing of data in cooperation with the treasury. These outreach efforts bore fruit even as they publicized the pandemic stimulus checks and the expanded Child Tax Credit. Despite the efforts, many people continue to experience difficulties in receiving payments, including those that have never filed tax returns or were filing them for the first time.
Others who have not received the stimulus check include people who do not have bank accounts or who do not have access to banks. A majority of the people were those families with mixed immigrant status. People with limited or no access to the internet and people experiencing homelessness have also been left out of the stimulus check benefits.
One of the biggest challenges faced by the IRS and the Treasury was the lack of data on people who have filed their returns. Following the outreach program to around ten million people, the IRS announced that they do not have further plans of outreach to distribute the stimulus checks.
Individuals who are in line to receive the federal stimulus checks but did not do so for lack of communication with the IRS can still file a simplified income tax return. And by not doing, they could be deprived of thousands of dollars worth of stimulus checks.
