Keep An Eye On The Mail: Treasury Now Sending 8 Million Stimulus Checks Via Prepaid Debit Card

Topline

The Treasury Department announced Thursday that it has begun sending out eight million economic impact payments in the form of prepaid debit cards. 

Key Facts

In a press release Thursday, Treasury said the cards can be used to make purchases in person or online where VISA debit cards are accepted, and they can also be used to withdraw money from ATMS and be transferred to personal bank accounts. 

The cards are administered by MetaBank N.A.

Only a small percentage of people will receive a debit card: money is also being sent via direct deposit and paper check to eligible individuals and families. 

The direct payments were authorized by the new federal stimulus bill President Trump signed into law at the end of December, which allocates $600 for single adults earning $75,000 per year or less (and $1,200 for couples filing jointly making $150,000 per year or less), as well as $600 per child under the age of 17 with the amount of payments phasing out slowly above those thresholds.

They are smaller than the first round of payments authorized by the CARES Act in March, which also went out via direct deposit, paper check, and debit card and were $1,200 per individual (and $2,400 per couple) and $500 per child, though the income thresholds where the phase-out begins remain the same.

The plain white envelopes in which the debit cards in the first round of payments were sent looked to many recipients like junk mail; Treasury noted Thursday that the new round of cards will be sent in envelopes “that prominently [display] the U.S. Department of the Treasury seal.”

Big Number

$112 billion. That’s how much money the IRS has already sent out electronically in the second round of individual direct payments, according to a Wednesday report from the Wall Street Journal. That’s about two-thirds of the money the new stimulus bill set aside for direct payments. 

What To Watch For

Senate Minority Leader Chuck Schumer (D-N.Y.) said during a press briefing Wednesday that passing legislation to increase the amount of direct payments in the most recent stimulus bill from $600 to $2,000 is “one of the first things I want to do.” The effort is backed by President Trump and Congressional Democrats and will be possible because of two Democratic victories in senate runoff races in Georgia this week. Those two victories handed control of the Senate to the Democratic party for the first time in six years, clearing the way for a spate of Democratic legislative priorities including additional stimulus legislation that Goldman Sachs expects to be worth some $750 billion. 

Further Reading

With Democrats Poised To Take Senate, Schumer Aims To Pass $2,000 Stimulus Checks First (Forbes)

Two-Thirds Of Stimulus Checks Worth $112 Billion Have Already Reached Bank Accounts (Forbes)

Extra $300 Unemployment Payments To Begin This Week In Some States (Forbes)

More Answers To Your Questions About The Second Round Of Stimulus Checks (Forbes)

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