Pandemic payments of $ 600 sent to bank accounts

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(Bloomberg) – The Internal Revenue Service began sending stimulus payments of $ 600 to the bank accounts of eligible Americans on Tuesday evening and will continue to process transfers until next week, according to a statement from the agency.

The IRS and the Treasury Department will begin sending out paper checks on Wednesday. The payments of $ 600 will go to many low and middle income adults. Dependent children aged 16 and under in these households are also eligible for $ 600 each.

“These payments may start arriving in some direct deposit accounts as early as tonight,” Treasury Secretary Steven Mnuchin wrote on Twitter on Tuesday.

“The IRS emphasizes that there is no action required by those eligible to receive this second payment,” the IRS said in a statement Tuesday night. “Some Americans may view direct deposit payments as pending or as interim payments in their accounts before the official payment date of January 4, 2021.”

The IRS begins sending the payments just two days after President Donald Trump signed off on the $ 2.3 trillion government funding and coronavirus relief program. The relief measures include a second round of out-of-pocket payments in an attempt to boost consumer spending and disposable income, which has fallen in recent weeks amid the spike in Covid-19 cases, hospitalizations and deaths, and new restrictions imposed by cities and states.

Congress approved a first round of payments of $ 1,200 in March.

Most individuals will be paid by direct deposit, but some will receive a paper check or prepaid debit card. Social Security, Veterans Affairs and Railroad Retirement beneficiaries who received their payments on Direct Express benefit cards in the first round, will also receive them this time around.

People earning up to $ 75,000 would receive $ 600; married couples collectively earning less than $ 150,000 would receive $ 1,200, plus an additional $ 600 for each dependent child. These amounts would be reduced by $ 5 for every $ 100 earned above the income threshold, meaning that people who earn more than $ 87,000 as an individual or $ 174,000 as a couple receive nothing.

If the Internal Revenue Service issues more individuals than they are supposed to receive, they do not have to repay the excess amount. The government is not allowed to collect payments to repay federal or state debts, and banks do not have the right to seize them.

Individuals who do not receive their full payment can claim the additional amount on the tax returns they file this spring.

The House passed a law on Monday that would increase payments to $ 2,000, a request made by Trump after Congress passed the economic aid bill. Republicans blocked a request for Senate review of the bill on Tuesday, blocking legislation. However, if the higher payment amount is approved, the IRS said it would send a separate payment to top up the original transfer “as quickly as possible.”

© 2020 Bloomberg L.P.

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