New stimulus plan would leave out 2.4 million Californians
Millions of higher-income Californians would get lower federal economic stimulus payments, or none at all, under a new Senate plan unveiled Wednesday, an economic research firm’s analysis found.
President Joe Biden has reportedly agreed to the plan, which has been sought by moderate Democrats. The payments are lower than those in legislation passed by the House.
An estimated 31.5 million Californians could get some stimulus money under the Senate proposal, according to data from the Institute on Taxation and Economic Policy. The House plan would benefit 33.9 million state residents.
Biden was said to agree to the changes Wednesday after moderate Democrats urged lowering the income limits for the economic stimulus payments. Qualifying taxpayers will still get $1,400 per person.
Qualified individuals with incomes of $75,000 or less and joint filers with incomes of $150,000 or less will get the full amount, just as they did in the House bill.
The big change is that in the new version, the payment will then be reduced until those earning $80,000 if filing individually and $160,000 if filing jointly will not get any money.
The House’ phaseout had gone up to $100,000 for individuals and $200,000 for joint filers.
Taxpayers earning below the income caps would get the same payments they’d be due under the House version.
The biggest change from the House bill would be at higher income levels, the Washington-based firm said. Filers and their families with incomes of $134,100 to $313,700 could see their payment drop from an average of $1,770 in the House plan to $1,250 in the new agreement.
These are estimated average benefits for other filers and their families under the plan:
▪ Lowest 20% income group, with incomes of less than $26,500, would receive $2,280. No change from previous proposal.
▪ Second 20% income group, with incomes ranging from $26,500 to $46,900, would receive $2,830. No change from previous proposal.
▪ Third 20% income group, with incomes ranging from $46,900 to $75,900 would receive $2,910. No change from previous proposal.
▪ Fourth 20% income group, with incomes ranging from $75,900 to $134,100, would receive $2,800, down from $2,930 in the House plan.
The state’s economy would also see less money. The House plan could boost economic activity by an estimated $45.2 billion, while the new plan would provide about $43.3 billion, according to the analysis.
The Senate began debating the measure, part of a $1.9 trillion COVID-19 relief act, with final votes anticipated later in the week. The measure would then need approval again by the House.
Biden is aiming to sign legislation by mid-March.
This story was originally published March 3, 2021 at 2:24 PM.
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