Investing legend Bill Gross says the Fed risks sinking the dollar if it persists with its ultra-easy policies

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Bill Gross.

  • The world’s reserve currency could sink under the Fed’s current policies, Bill Gross said in the FT.
  • He disputed Jerome Powell’s decision to keep interest rates low until the pandemic is under control.
  • Inflation will force the Fed to move away from its ultra-easy policies sooner than expected, he said.
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Billionaire investor Bill Gross wrote in a Financial Times op-ed on Tuesday that the Federal Reserve could risk sinking the dollar if it continues to support accommodative monetary policies for too long.

“I suspect that $5 trillion spending programmes and the Fed’s current package of near zero per cent short-term rates and $120 billio n of monthly bond buying will move growth, inflation and financial markets far beyond reasonable targets that ultimately will jeopardize post-Covid-19 normals,” he wrote.

Gross, who has since retired since co-founding investment firm Pimco and moving Janus Henderson Investors, argued the threat of inflation will force the US central bank to change tack and move away from its policies sooner than it expects.

“The Fed cannot for long continue to maintain current policy rates and expand its own balance sheet and therefore private bank reserves at a $120 billion monthly pace,” he said.

Enormous amounts of money, as a result of quantitative easing, pumped into the economy over the past year to help sustain the fallout from COVID-19 led to an increase in the amount of cash in circulation. This circumstance inevitably leads to inflation and decreases the value of the currency, thereby devaluing investor savings.

Gross called out Fed Chairman Jerome Powell for transitioning from a more conservative stance to one that has “unleashed the potential for chaotic future economic and market outcomes.”

The one-time “bond king” disputed Powell’s decision to keep interest rates low until the pandemic is more controlled and employment returns to normal. Unemployment may never return to 4% given the revolutionary changes in the work-from-home environment, in Gross’ view.

“And how long can the Treasury continue to require near-costless Fed financing for $2 trillion, $3 trillion and $4 trillion deficits without sinking the dollar? In a historical gold-standard world, Fort Knox would have been emptied long ago, implying the bankruptcy of the world’s reserve currency,” he said.

Gross also suggested that several cryptocurrencies and the boom in special-purpose acquisition companies have been a result of having an accommodative Fed.

“Cash has been trash for years, but soon it may be the only haven for investors sated beyond reasonable expectations of perpetually low yields and supportive bond kings and queens,” he said.

Read More: A senior crypto trader at a $500 million digital asset manager shares his favorite trading strategies to generate ‘riskless profits’ – and the 3 sectors of the nascent market that he is most bullish on

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Trump appointees have been left furious after being asked to ‘immediately’ pay thousands of dollars in deferred payroll taxes, which they thought would be forgiven

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Former President Donald Trump and former first lady Melania Trump.

  • Members of Trump’s admin were asked to pay the payroll tax Trump deferred, Politico reported.
  • Trump deferred some payroll tax in August 2020, sidestepping Congress in an emergency declaration.
  • “I just wish I had the option to opt-out,” a former administration staffer told Politico.
  • See more stories on Insider’s business page.

Some staffers from President Donald Trump’s administration have reportedly seen their tax bills spike as they’re being asked to pay payroll taxes deferred by the president.

Politico reported that members of Trump’s administration have reportedly been receiving letters asking them to pay Social Security taxes that were deferred, with at least one bill reaching $1,500.

“If the indebtedness is not paid in full within 30 calendar days, we intend to forward this debt to the Department of Treasury, Treasury Offset Program, for further collection,” said a copy of a letter sent May 18, 2021, by an accounting officer from the Office of Administration.

Trump set the policy on August 8, 2020, in a memo to Treasury Secretary Steven Mnuchin, directing Mnuchin to defer some payroll taxes to “put money directly in the pockets of American workers” who needed it most.

Trump sidestepped Congress to make the change because the pandemic was “of sufficient severity and magnitude to warrant an emergency declaration.”

As many as 1.3 million federal workers may have had some of their payroll taxes deferred under the measure, as Insider reported in September. Under the plan, earners paid less than $4,000 every two weeks wouldn’t have to pay the 6.2% tax out of their paychecks from September through the end of the year.

Now, the government’s looking for those deferred taxes, according to Politico. The report quoted several former administration staffers who called the bills “unacceptable.” One said: “It’s just a very unfortunate situation.”

The letter published by Politico included a “Voluntary Repayment Agreement” as an attachment, with an option to pay via credit or debit card.

One anonymous Trump appointee told the publication that the former president had a “good plan,” but, “I just wish I had the option to opt-out.”

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The US Treasury wants every crypto transfer larger than $10,000 to be reported to the IRS

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  • The US Treasury said a proposal to beef up the IRS includes reporting any transfers of at least $10,000 in cryptocurrencies for tax purposes.
  • “As with cash transactions, businesses that receive crypto assets with a fair-market value of more than $10,000 would also be reported on,” The Treasury Department said.
  • Bitcoin sold off by as much as 6% on Thursday following the announcement.
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The Treasury Department detailed plans to have any cryptocurrency transfers of at least $10,000 to be reported to the Internal Revenue Service in a report on Thursday.

Bitcoin pared its gains and fell by as much as 6% in afternoon trading following the release of the report, adding to the cryptocurrency’s volatile week of trading in which it fell more than 30% in a day.

“As with cash transactions, businesses that receive cryptoassets with a fair-market value of more than $10,000 would also be reported on,” the Treasury Department said in the report. The report is part of the Biden administration’s plans to beef up the IRS in hopes of collecting more tax revenue that otherwise goes unreported.

The IRS first began asking individuals if they ever bought or sold virtual currencies in 2020, and now requires individuals to report capital gains realized from any cryptocurrency transactions.

The Treasury Department said that reporting the crypto transactions is necessary “to minimize the incentives and opportunity to shift income out of the new information reporting regime,” according to the report.

“Cryptocurrency already poses a significant detection problem by facilitating illegal activity broadly including tax evasion,” the Treasury added in its report.

The move by the Treasury Department comes after the Colonial gas pipeline was briefly shutdown due to a ransomware threat, in which the company ultimately paid the hackers $5 million in bitcoin. Those same hackers have collected a total of $90 million in bitcoin by running a similar ransomware scheme against other companies.

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The US ran a record $1.9 trillion budget deficit from October to April, Treasury Department says

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Hackers appear to have stolen encryption keys used by the US government, compromising the email accounts of top offiicals at the Treasury Department.

  • The Treasury Department announced a record $1.9 trillion budget deficit in the first seven months of the fiscal year.
  • This was accompanied by a 22% increase in outlays, or personal spending, to a record $4.1 trillion.
  • Federal tax receipts of $2.1 trillion also hit a record for the seven-month period ending in April.
  • See more stories on Insider’s business page.

The US Department of Treasury announced on Wednesday that the US ran a $1.9 trillion budget deficit in the first seven months of the fiscal year – a record for that time frame.

As the country continued to recover from the pandemic, federal spending contributed to the budget deficit which marked a 30% increase from a year earlier. The department also found that outlays, or personal spending, rose 22%, to a record $4.1 trillion, which can be attributed to the government’s stimulus checks and extended unemployment benefits to aid Americans during the pandemic.

In addition, federal tax receipts also hit a record for the seven-month period ending in April, rising 16% to $2.1 trillion.

As the country continues to reopen, the US economy is likely to see a boost as more jobs are added to the labor market and spending increases. However, last week’s jobs report fell significantly short of expectations, adding just 266,000 despite economists’ prediction of at least 1 million, causing some businesses and lawmakers to cast the blame on government aid, like extended $300 weekly unemployment benefits, which they say disincentivizes people from returning to work.

But President Joe Biden, and his administration, are confident in the economy’s recovery.

“I think as we continue to move forward here, hopefully in the coming months we are going to see lots of those Americans who are looking for jobs, finding jobs, and I’ll be able to stand in front of this camera and talk about the great gains we’ve had,” Labor Secretary Marty Walsh said last week. “But I still think 266,000 jobs this month is a good number.”

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Biden breaks with Trump and says he’ll stick up for Federal Reserve’s independence

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  • Biden said he wanted to break with Trump in sticking up for the Federal Reserve’s independence.
  • “I want to be real clear that I’m not going to do the kinds of things that have been done in the last administration,” Biden said.
  • While he was in office, Trump pressured Fed Chair Powell against raising interest rates.
  • See more stories on Insider’s business page.

President Joe Biden said on Tuesday he would safeguard the independence of the Federal Reserve, breaking with his predecessor, Donald Trump, who often tried pressuring the central bank to lower the cost of borrowing.

“Starting off my presidency, I want to be real clear that I’m not going to do the kinds of things that have been done in the last administration – either talking to the attorney general about who he’s going to prosecute or not prosecute … or for the Fed, telling them what they should and shouldn’t do,” he said at a White House news conference.

“I think the Federal Reserve is an independent operation,” he said, adding he does speak with Treasury Secretary Janet Yellen. The Treasury did not immediately respond to a request for comment.

The remarks reflect another way that the president is distancing himself from his predecessor by preserving the Fed’s traditional independence from the White House. Trump heaped criticism onto Powell throughout his term, assailing him as “an enemy of the state” and a “terrible communicator” from his now-suspended Twitter account.

Trump furiously tried pressuring Powell from raising interest rates while the economy was in the middle of its longest expansion in history in the years leading up to the pandemic. At one point, he suggested Powell may be a “bigger enemy” of the US than China.

Powell played a critical role designing the Fed’s stimulus programs as vast swaths of the economy shut down last year. He also encouraged Congress to continue approving more federal aid for struggling individuals, small businesses, and state and local governments.

“Given the low level of interest rates, there’s no issue about the United States being able to service its debt at this time or in the foreseeable future,” he told NPR recently. Powell, a Trump nominee, has also downplayed the inflation risks stemming from the $1.9 trillion stimulus package.

Powell’s term as Fed chair expires in 2022, and Biden must decide whether to keep him onboard.

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Treasury yields spike to highest in 14 months, pulling tech stocks down while boosting banks

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Fed Chairman Jerome Powell.

  • The 10-year Treasury yield pushed past 1.7% on Thursday, marking a fresh 14-month high for the benchmark note.
  • The 30-year yield also made a notable move by rising to 2.5% for the first time in more than a year.
  • Tech stocks were losing ground but bank shares advanced on the back of richer yields.
  • See more stories on Insider’s business page.

Borrowing costs quickly picked up pace Thursday as the benchmark 10-year Treasury note yield surged to a fresh 14- month high, with the move pressuring tech stocks but bolstering bank shares.

The 10-year yield climbed to an intraday high of 1.754%, a leap of nine basis points since ending at 1.64% on Wednesday. Meanwhile, the 30-year yield on Thursday rose to 2.5% for the first time since August 2019. That yield on Wednesday settled at 2.437%.

Investors keep a close watch on long-dated yields as they are tied to a range of lending programs such as mortgages and auto loans. Yields have been rising, while bonds sell off, as investors continue to price in expectations of higher inflation as the US economy recovers from the COVID-19 crisis.

But the increase in borrowing costs has stoked selling in growth stocks, including large-cap tech stocks that have run up over the past year. Thursday’s moves included Apple falling by 2.3%, Google’s parent company Alphabet down by 1.1%, and Microsoft losing 1.7%. The Nasdaq Composite, home to numerous tech stocks, lost 1.4%, and the S&P 500‘s information technology sector slumped 1.5%.

The 10-year yield on Wednesday reached its highest since January 2020 as investors positioned themselves before the Federal Reserve released its policy decision and economic projections. The central bank’s upgraded economic outlook included its view that gross domestic product will expand by 6.5% this year, up from the prior estimate of 4.2%. The 10-year yield pulled back from the 1.6% area during Wednesday’s session before roaring higher again on Thursday.

“Right now the market is pricing in a rate hike in the latter half of 2022, which we think is very early and, in fact, it’s nearly mathematically impossible for the Fed to hike in 2022 if they truly intend to look past transitory inflation,” Calvin Norris, US rates strategist at Aegon Asset Management, told Insider on Thursday. “What the market is implying is the Fed is going to cave on this persistency-of-inflation idea.”

Fed Chairman Jerome Powell on Wednesday reiterated the central bank’s stance of allowing inflation to rise past 2% to support growth in the labor market and the economy before it starts raising interest rates.

While tech stocks sold off, bank stocks charged up, with Bank of America gaining 4.1%. Banks aim to lend money on long-term rates and the increase in long-dated yields improves their prospects for growth in interest income.
Wells Fargo climbed 3.8% and JPMorgan Chase popped up 3.5%.

Also, the Invesco KBW Bank ETF tacked on 3% and the SPDR S&P Regional Banking ETF gained 3.2%.

“While it’s difficult to say when this might occur but we’re kind of setting the stage for some type of counter-trend rally here in Treasuries,” said Norris. “Treasuries are oversold, sentiment is extremely bearish, Treasuries are very cheap to foreign buyers,” he said.

“I think the market is trying to challenge the Fed. But if you do believe the Fed and the projections for growth and inflation, valuations look very attractive at these levels. Not to say that they can’t get cheaper and be more attractive but we’re at those levels that I think it’s difficult to add to short positions in here,” Norris added.

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How to make sense of the COVID economic crisis, explained by a former US Treasury official

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22 million job losses were reported in March and April 2020.

  • Jan Eberly is a finance professor at the Kellogg School and a former chief economist at the Treasury.
  • The current economic crisis is unique since the primary underlying issue is the pandemic, she says.
  • Eberly says it will take time to strengthen small businesses and the labor force after the public health crisis recedes.
  • See more stories on Insider’s business page.

What should one make of the COVID economy?

The unemployment rate is falling, but nearly 10 million Americans who lost their jobs to the pandemic remain unemployed. A speedy vaccine rollout promises to reopen many sectors of the economy, but the national debt is on the rise. School and daycare closures have hit mothers, especially Black and Latinx ones, hard – but a new child tax credit promises to lift millions of families out of poverty.

As yet another stimulus package leaves the Oval Office with a signature – and the IRS sends an unprecedented third stimulus check to many Americans – one could be forgiven for wondering what to make of it all.

So we asked Jan Eberly, a professor of finance at Kellogg and senior associate dean of strategy and academics, for her take. The last time the US was pulling itself out of a recession – the Great Recession – Eberly was assistant secretary and chief economist at the Treasury. The experience gave her a clear view of the power and challenges of using public policy to restore jobs, incomes, and the broader economy.

Eberly explained that there is plenty that policymakers are doing to encourage a quick recovery. But it is important to understand just how different this crisis is from other economic crises.

“We can address what is happening in the economy,” she said. “But the underlying issue is the pandemic. Fundamentally, this is a public health shock and that must be first and foremost in the recovery.”

Here, Eberly offers her take on this strange, new pandemic economy.

Job losses have been stark but uneven

Prior to March 2020, the US economy was humming nicely, and weekly unemployment claims numbered just a few hundred thousand. Then, the coronavirus hit, and seven million jobs were lost seemingly overnight. Over March and April, losses climbed to 22 million.

New unemployment claims have since come down. “But there are still nearly 10 million people who have not returned to their jobs nor found a new job in the pandemic economy,” said Eberly, “which is more people than were unemployed at the height of the Great Recession.”

Moreover, she explained, job losses were not spread evenly over the economy. Unlike in previous downturns, where people pressed “pause” on purchasing durable goods like cars or furniture, two-thirds of the decline in consumer spending this time was on services. In particular, it’s the in-person services – restaurants, hotels, airlines, barbers – that have been absolutely clobbered. And because of the low wages associated with most in-person services work – as well as the overrepresentation of Black, Latinx, and women workers in these industries – the pandemic has been absolutely devastating for those already struggling economically. Women were also disproportionately impacted by school closures and the loss of childcare.

Given that the pandemic’s effect on the economy has not been equally shared, policymakers needed to focus not so much on “stimulus” as on “insurance,” said Eberly. After all, the map of the pandemic economy is so unusual that using traditional stimulus can even be counterproductive if it channels support to parts of the economy that are already spared or even thriving in a remote environment.

Instead, “it’s more like FEMA and emergency relief: effectively, a hurricane hit the economy, and you try to target policy on the people and parts of the economy that are most affected,” said Eberly. “But targeting is hard to do at the scale of the US, especially when the ways in which the pandemic hit are different than in the past. So policymakers have had to innovate or try to use existing programs in novel ways.”

The relief provided has been targeted

How have policymakers been targeting their efforts – and to what effect?

Most prominently, there was expanded unemployment insurance, which was of course targeted to precisely those individuals who had lost their jobs. The expansion boosted the size of the unemployment checks, how long they could be collected, and – for the first time – even who was eligible in the first place.

The pandemic was a “wake up to reaching the gig economy!” Eberly said. “The expanded unemployment insurance was also available to people who didn’t have formal employment. It was really a transformation in availability of unemployment insurance.”

Another targeted policy: the foreclosure and eviction moratoria, which protect homeowners and renters who have been directly affected by the pandemic. During the Great Recession, the housing market was at the epicenter of the financial crisis; during the pandemic economy, fueled by low interest rates and different living needs, housing has proven to be a relative strength. Still, that is cold comfort for the many individuals who have lost their jobs and might otherwise lose their homes.

In Eberly’s view, there is reason for cautious optimism that the moratoria are doing exactly what they are intended to do.

“The early research on this says that we’re not seeing people losing their homes – that they own or that they rent – as we did during the financial crisis,” she said. However, as the moratoria end, there is a lingering question of whether and how the accumulated arrears will be paid, and how renters, borrowers, and also smaller landlords will fare as the bills come due.

In addition, each of the three rounds of the stimulus relief checks have had income restrictions, which target them to individuals who earned less than either $100,000 or $80,000 (depending on the round) but provide broad support.

There have also been multiple rounds of funding to the Paycheck Protection Program (PPP), which was intended to support smaller businesses than those that usually benefit from broad credit relief. In Eberly’s view, this is a case where a potentially innovative program was hampered by the lack of existing connections to quickly target funds to those most in need.

With this latest round of stimulus relief, state and local funding is finally getting a boost. Earlier relief packages danced around the issue, assisting badly battered states and cities by providing funds for schools, vaccines, testing, and food assistance. But this time, money is going straight to state and city coffers. “Three hundred fifty billion for state and local governments that have been hit hard by the pandemic is what states and cities were asking for,” Eberly said. The funds “give them more flexibility to buttress programs and needs that arose during the pandemic, especially after the exhaustion of their rainy-day funds.”

Finally, and perhaps most surprisingly, the latest round of stimulus also provides targeted relief to families with children in the form of an enhanced child tax credit. For all but the highest earning families, the credit will be increased to $3,600 for kids under six, and $3,000 for kids under 18 – and critically, it will be refundable and paid out throughout the year, meaning that families who don’t ordinarily earn enough to benefit will still receive periodic checks for the full amount. Some estimates suggest that the benefit could lift 40% of children out of poverty.

“The group in the US most exposed to poverty is children,” Eberly said. “The credit is helping families with children who were especially vulnerable during the pandemic because they were vulnerable already.”

This could be transformational. If this credit is extended to subsequent years, she said, “it could reduce childhood poverty and distress for those who need it most – and where the benefits could change lives.”

What will be the long-term impact?

It is too soon to know whether economic changes, like work-from-home, and policy changes, like targeted fiscal support, will last. But the pandemic has forced action and innovation. The first CARES Act was passed in record time and provided crucial initial support. When the pandemic outlasted that first effort, policymakers came back with targeted support plus some broad measures intended to bridge the economy through a tough winter and on to post-COVID.

Eberly is optimistic that these measures will act as that bridge. Some sectors of the economy have already bounced back or are poised for a quick recovery. After all, many individuals who have remained employed throughout the pandemic have extra money in their pockets and will want to spend it. Savings are at record highs and some spending categories are already strong.

“As the underlying public health crisis recedes, some parts of the economy will come back energetically. People will be able to get out and travel and live their lives with more confidence,” Eberly said.

Still, she worries that other parts of the economy will be far slower to recover, and that many workers who have been the hardest hit will continue to struggle. One particular concern as the pandemic drags on is that, once individuals have been out of the labor force for a long time, it gets harder and harder to return. “When people talk about the ‘scarring’ of the economy, it’s usually around long-term unemployment,” Eberly said. This is especially true for groups that had higher unemployment rates to begin with and were just getting more economic traction pre-pandemic.

Small businesses, long shuttered, could run into similar problems as they try to reopen. And while new businesses will eventually step in to fill the gap, that all takes time. “We will see some good headlines, I hope. I’m optimistic about that,” she said. “But it won’t lift everyone simultaneously.”

What is Eberly not particularly concerned about at this time? The accumulated debt, which is paying for all of this relief. There is near unanimous consensus among economists that the national debt is large, and quickly growing larger. And there is concern that it may constrain our ability to act so aggressively in the future. But “the best thing we can do for future fiscal stimulus is to get the economy back on its feet,” she said. “Right now, there is a necessary focus on recovery. And with interest rates low, there is some breathing room to invest in a stronger, more resilient economy.”

Above all, Eberly hopes that the extraordinary moment will convince Americans that thoughtful, competently executed, and well-targeted government policies can go a long way toward building an economy that works for everyone. Amid the missed opportunities and unimaginable losses, there also came innovation and a deep commitment to help provide relief.

“If what people and policymakers learn is that governments can help – to intervene effectively to provide relief from a once-in-a-generation pandemic – that would be a success of policy,” she said.

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Janet Yellen wants to overhaul corporate taxes for the whole world – she’s talking to other countries about a minimum rate

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Treasury Secretary Janet Yellen.

  • The Washington Post reports Treasury Secretary Yellen is working on a global minimum tax rate.
  • The nonbinding rate would apply to multinationals, as she seeks to keep them from shopping for the lowest territory.
  • Yellen and Biden want to raise the corporate tax rate but need the rest of the world onboard.
  • See more stories on Insider’s business page.

Treasury Secretary Janet Yellen has been clear since her confirmation hearing and subsequent press appearances that the Biden administration needs to raise new tax revenues. At the same time, she’s warned of the difficulties of implementing a wealth tax, which is favored by the progressive wing of the Democratic Party.

Part of the solution is reforming the corporate tax rate – not just in the US but far beyond its borders.

To that end, Yellen is in active talks with other countries about setting a global minimum rate for corporate taxes, The Washington Post’s Jeff Stein first reported.

The US was long an outlier, with a corporate tax rate of 35% versus the international average of 24%, until former President Donald Trump’s 2017 tax cut slashed the corporate rate to 21%. But even that hasn’t stopped other countries from lowering their rates to attract multinationals. The Post noted that nine countries lowered their corporate tax rate just last year.

Nobel Prize-winning economist Joseph Stiglitz, a mentor of Yellen’s, told the Post that if she is successful in these talks, it would be “a little like the Paris climate accord of taxes.” Yellen is holding talks with more than 140 international counterparts via the Organization for Economic Cooperation and Development (OECD), where countries are looking at global tax issues, with a particular focus on tech.

The goal for now is a nonbinding consensus on a minimum tax rate within the OECD, with the thinking that the US could move off the Trump-era 21% without fear of multinationals leaving to pay taxes at a lower rate somewhere else.

In the background of Yellen’s push for a global minimum is the Biden administration’s current push to find more tax revenue. President Joe Biden is reportedly planning the first major federal tax increase in nearly three decades, according to Bloomberg. One of the proposals on the table is a raise to the corporate tax, something that Biden campaigned on. He’s proposed raising the corporate tax rate to 28%.

The right-leaning Tax Foundation found that, since 1980, the “worldwide average statutory corporate tax rate has consistently decreased,” with the biggest drops coming in the early 2000s. According to the Tax Foundation, “the worldwide average statutory corporate income tax rate” is 23.85%.

Biden also just said this week that Americans earning over $400,000 could see an increase in their taxes, a measure he acknowledged may not win any Republican support.

There could be a complicated path forward for Yellen’s corporate minimum, per the Post. Congress may need to be involved in approving new tax rules, and it could take the countries involved years to enact the tax, if they even choose to adopt it.

As the Post reports, if the complex measure is successful, it would be a huge accomplishment for both Yellen and Biden’s presidency – and maybe the world. It could also help pay for a $2 trillion infrastructure package.

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Treasury says it has issued 90 million direct payments – and Americans can start accessing their stimulus checks

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  • The Treasury Department said on Wednesday it’s already issued 90 million direct payments.
  • It means Americans can start accessing stimulus cash, including those with accounts at major banks.
  • Individuals earning up to $75,000 qualify for a full check from the federal government.
  • See more stories on Insider’s business page.

The Treasury Department announced Wednesday it has distributed 90 million direct payments to Americans, and people can start tapping into their federal relief funds.

“The first batch of payments were mostly sent by direct deposit, which some recipients started receiving this past weekend,” the Treasury Department said in a statement. “As of today, all recipients of this first batch of direct deposit payments will have access to their funds.”

The 90 million federal payouts amounted to $242 billion, the Treasury said. It added that the first round of direct payments went to taxpayers who provided deposit information on their 2019 or 2020 tax returns. The federal government has also mailed 150,000 paper checks, the agency said.

The IRS and Treasury started distributing the $1,400 federal payments on Friday evening, only a day after President Joe Biden signed the $1.9 trillion stimulus plan into law.

However, customers at major banks like Wells Fargo had to wait for the government cash to be released on March 17 before being able to tap into the money.

Singles earning up to $75,000 in adjusted gross income qualify for the full amount, along with couples making up to $150,000. Each adult dependent is eligible for a check as well. But the stimulus payments diminish in size much more quickly. Individuals earning above $80,000 and couples making above $160,000 will receive zero.

People can track the status of their relief checks using the “Get my Payment” portal. The Treasury said that 35 million Americans had accessed the service for more information.

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Americans can start tracking the status of their $1,400 stimulus checks on Monday

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  • The IRS said people can begin tracking the status of their payments on Monday.
  • The initial batch of $1,400 checks has started landing into people’s bank accounts.
  • The IRS is moving swiftly to send out the checks as part of Biden’s stimulus law.
  • See more stories on Insider’s business page.

Americans are starting to see $1,400 stimulus checks land in their bank accounts this weekend under President Joe Biden’s stimulus law. But people who don’t get a direct payment right away won’t be left unaware of its arrival for much longer.

The IRS said on Friday that people can begin tracking the status of their checks using the “Get my Payment” portal on Monday. The agency also said it expects to issue more direct deposits and send payments as a check or debit card over the coming weeks.

The IRS also said a payment date will be announced for beneficiaries of Social Security and other safety net programs.

Singles earning up to $75,000 in adjusted gross income qualify for the full amount, along with couples making up to $150,000. Each adult dependent is eligible for a check, a change from the first two rounds of stimulus payments.

People earning above those thresholds can still receive a smaller direct payment. But eligibility is capped for individuals earning more than $80,000 and joint filers making above $160,000. They’ll get zero.

The swift arrival of the federal payments underscore the IRS’s improving ability to get cash out the door quickly, especially for people with direct deposit information in their systems.

Last year, Congress and former President Donald Trump approved $1,200 stimulus checks for most taxpayers. Those government payouts started going out in two weeks.

Then in December, $600 checks started going out within days of Trump signing an earlier pandemic relief package. It took around a month and a half for the IRS to distribute 147 million payments.

Biden touted the direct payments during his first primetime address on Thursday evening, timed to the first anniversary of the nation’s pandemic lockdowns. He said a family of four earning $110,000 can expect to receive $5,600 in cash benefits.

The federal government estimates this batch of direct payments will cost $411 billion.

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