Here's What You Need to Remember: The IRS continues to have a sizable backlog of tax returns to process – many of which contained errors, meaning that the agency needs to carefully evaluate them. The tax collection agency has also been tasked with distributing the six Child Tax Credit advance payments, of up to $3,600 per child, to 36 million American families.
The third round of stimulus payments, approved by Congress and signed into law by President Joe Biden in March 2021, are still being sent out. Roughly 90 percent of the payments have already been made, at a cost of $400 billion to the federal government.
The IRS announced on Wednesday that 2.2 million additional payments had been sent out by the IRS during June and July. 1.3 million of these payments targeted first-time recipients – Americans whose information had not been on file with the IRS, and who consequently had been unable to receive a check prior to their filing of their 2020 taxes.
The remaining 900,000 new recipients received smaller “plus-up” checks – checks designated for Americans who had already received partial, but incomplete, stimulus relief. Plus-up checks have been sent out because many Americans filed their 2020 taxes after the first of the March 2021 checks had already been distributed. Therefore, if a family’s income situation shifted downward, allowing them to claim a larger payment, the IRS would not have sent it to them until their 2020 taxes were processed.
The IRS continues to have a sizable backlog of tax returns to process – many of which contained errors, meaning that the agency needs to carefully evaluate them. The tax collection agency has also been tasked with distributing the six Child Tax Credit advance payments, of up to $3,600 per child, to 36 million American families. The first of these payments was sent last week, while the last will be sent in December. Altogether, these advance payments will cover half of the Child Tax Credit; the other half can be claimed as a tax rebate when it comes time to file a family’s 2021 taxes in April 2022.
Other states are experimenting with their own stimulus programs, on a smaller scale. California, which ended 2020 with a massive state budget surplus, has announced that all of its residents will receive $600 checks in the fall. In addition, many states have approved “thank-you bonuses” to certain categories of essential workers during the pandemic, most notably including teachers.
At the same time, demands for a fourth stimulus check have continued, although Congress has made clear that its priorities are elsewhere. A Change.org petition calling for monthly $2,000 payments for all American adults until the pandemic ends – a proposal regarded as ridiculous in some corners – recently passed 2.6 million signatures.
Trevor Filseth is a current and foreign affairs writer for The National Interest. This article first appeared earlier this year.