In an effort to reach a bipartisan COVID-relief plan, 10 moderate Republican senators are offering a more “targeted” alternative to President Biden’s $1.9 trillion stimulus plan. An important piece of the Republicans’ counteroffer is a third-round of stimulus checks at $1,000 per eligible person ($2,000 for married couples). This is likely to fall short of the president’s expectations, since his plan calls for $1,400 payments and many Democratic lawmakers want $2,000 stimulus checks. However, Biden agreed to meet with the Republican senators on Monday to discuss their entire stimulus plan, which at $618 billion is less than a third as costly as the president’s plan.
The phase-out thresholds for the $1,000 stimulus checks would also be lowered, and the phase-out rate would be adjusted, so that fewer people receive a payment. For the first two stimulus checks, payments were reduced at a rate of $1 or every $20 of adjusted gross income (AGI) over a certain threshold amount. Higher-income people saw their stimulus checks reduced to zero. The AGI threshold for single Americans was $75,000 for the first- and second-round payments and $150,000 for married couples filing a joint tax return. Biden’s $1,400 payments would be phased out starting at the same AGI levels. Under the Republicans’ plan, the $1,000 stimulus checks would be reduced at a rate of $1 for every $10 of AGI above $40,000 for single people and above $80,000 for married couples.
The Republican plan also calls for an extra $500 for each dependent child or adult in the family. The Biden plan also calls for additional payments for each dependent in the family regardless of age, but the president hasn’t said how much those payments would be (although speculation is that it would be $1,400 per dependent). The first- and second-round stimulus payments included $500 and $600 additional payments, respectively, but they were only available for dependent children age 16 or younger.
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The charts below illustrate how the phase-out would apply to $1,000 payments, plus the extra $500 for dependents, using the Republicans’ proposed phase-out thresholds.
SINGLE PEOPLE ($40,000 THRESHOLD)
|
NUMBER OF DEPENDENTS IN THE FAMILY |
||||||
|
AGI |
0 |
1 |
2 |
3 |
4 |
5 |
|
≤ $40,000 |
$1,000 |
$1,500 |
$2,000 |
$2,500 |
$3,000 |
$3,500 |
|
$45,000 |
$500 |
$1,000 |
$1,500 |
$2,000 |
$2,500 |
$3,000 |
|
$50,000 |
$0 |
$500 |
$1,000 |
$1,500 |
$2,000 |
$2,500 |
|
$55,000 |
$0 |
$0 |
$500 |
$1,000 |
$1,500 |
$2,000 |
|
$60,000 |
$0 |
$0 |
$0 |
$500 |
$1,000 |
$1,500 |
|
$65,000 |
$0 |
$0 |
$0 |
$0 |
$500 |
$1,000 |
|
$70,000 |
$0 |
$0 |
$0 |
$0 |
$0 |
$500 |
|
≥ $75,000 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
*
MARRIED COUPLES FILING A JOINT RETURN ($80,000 THRESHOLD)
|
NUMBER OF DEPENDENTS IN THE FAMILY |
||||||
|
AGI |
0 |
1 |
2 |
3 |
4 |
5 |
|
≤ $80,000 |
$2,000 |
$2,500 |
$3,000 |
$3,500 |
$4,000 |
$4,500 |
|
$85,000 |
$1,500 |
$2,000 |
$2,500 |
$3,000 |
$3,500 |
$4,000 |
|
$90,000 |
$1,000 |
$1,500 |
$2,000 |
$2,500 |
$3,000 |
$3,500 |
|
$95,000 |
$500 |
$1,000 |
$1,500 |
$2,000 |
$2,500 |
$3,000 |
|
$100,000 |
$0 |
$500 |
$1,000 |
$1,500 |
$2,000 |
$2,500 |
|
$105,000 |
$0 |
$0 |
$500 |
$1,000 |
$1,500 |
$2,000 |
|
$110,000 |
$0 |
$0 |
$0 |
$500 |
$1,000 |
$1,500 |
|
$115,000 |
$0 |
$0 |
$0 |
$0 |
$500 |
$1,000 |
|
$120,000 |
$0 |
$0 |
$0 |
$0 |
$0 |
$500 |
|
≥ $130,000 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
For more on how stimulus checks can be more “targeted,” see Would You Get a “Targeted” Stimulus Check?
Under the Republican plan, convicted inmates would not receive a stimulus check. Other details to look for with regard to a potential third-round stimulus checks include whether the AGI phase-out thresholds are based on 2019 tax returns or 2020 returns, whether you need a Social Security number to qualify for a payment, and whether payments are subject to garnishment for past-due debts you owe. Stay tuned for more information.
Source: kiplinger.com