Stimulus checks benefited lower-class, middle-class households, data showsFebruary 2, 2021
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As Congress considers provisions for an additional round of direct payments to American households, the IRS released data this week showing that the first payments largely benefit lower-to-middle class families.
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In total, the tax agency sent out 161.9 million $1,200 checks under Coronavirus Aid, Relief, and Economic Security Act, commonly known as The CARES Act.
The largest number of payments (20.6 million) went to households with adjusted gross incomes between $10,000 and $20,000, the data showed.
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According to a Tax Foundation analysis of the data, three-quarters of the payments were distributed to households earning less than $100,000.
About 32.5% of the checks were sent to people with adjusted gross incomes between $1 and $30,000.
About 31.5% of the money went to households earning between $30,000 and $75,000.
Households earning between $75,000 and $100,000 received 10%, while those with incomes ranging from $100,000 to $200,000 got 14.8%.
Households earning more than $200,000 – who were largely ineligible – received 412,372 payments.
An additional 10.1% went to nonfilers, for whom no income data was available.
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In December, a second round of $600 checks was approved, which have been sent out to eligible Americans.
A recent analysis shows that these payments largely benefit households earning less than $78,000 – who were more likely to spend the funds within the first month. Higher-income households were more likely to save the cash.
President Biden and lawmakers are considering topping off those $600 payments at $2,000 – which would indicate the payment of an additional $1,400 to households.
However, the terms of those payments are being negotiated in Congress where discussions are taking place to potentially lower the income thresholds.
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