There is an 85% chance that a stimulus package will be approved in the first three months of 2021. It could be a few more weeks before the $1.9 billion stimulus package proposed by President-elect Joe Biden, which includes a third round of $1.4 billion stimulus checks, is approved.
It is virtually a given that this third $1,400 stimulus check will pass, as there is growing support among Republican lawmakers to send more money to Americans.
In fact, there is an 85 percent chance that a stimulus package will be passed in the first three months of 2021 that includes a stimulus check, predicted Hammond of Height Securities, a financial analysis firm.
Alec Phillips, a political economist at Goldman Sachs, believes the package could be approved by mid-February or mid-March.
Once the proposed stimulus package passes through Congress, it must be signed by the president. After that, the IRS will distribute the money through direct deposit, mailed checks and prepaid debit cards.
Based on the above, assuming Congress approves a new stimulus package in mid-February, the third stimulus checks could reach beneficiaries’ bank accounts by the end of February, at best.
On the other hand, if a stimulus package is passed through the end of March, people could receive their checks in early April.
The first people to receive Biden’s proposed third $1,400 stimulus check, if approved
The distribution process would follow the same guidelines as the first and second stimulus checks. As with the first and second stimulus checks, if a third check is approved, the first to receive payments will be the recipients who provided their information for direct deposit to the IRS.
Yesterday, Friday, the IRS was supposed to complete most of the second round of payments under the 2021 Pandemic Response and Relief Supplemental Appropriations Act passed last December.
The statute established a deadline of less than one month for the agency, in coordination with the Treasury Department, to complete the process.
The president-elect announced Thursday his two-step or phased economic recovery and rescue plan that includes minimum checks of $1,400 to complement the $600 checks that are still coming to millions of beneficiaries.
But before he can start releasing new payments, both the Senate and the House need to approve Biden’s proposal, who will officially take office Jan. 20.
The scenario looks good, according to financial analysts, and Republicans are likely to join Democrats (who will have a majority in both houses) in making way for new money transfers.
Financial Analysts Anticipate More Stimulus Checks Soon
Hunter Hammond of Height Capital Markets anticipates that there is an 85% chance that a package will be approved in the first three months of 2021.
Edward Mills, an analyst at Raymond James Investment Bank, also sees possibilities for further support as part of a reduced package.
“We believe there is support for a small package that includes $1,400 checks, more funds for health care, small business support, and local and state aid,” Mills said, as quoted by CNBC.
For his part, Alec Phillips, chief political economist of Goldman Sachs in the United States, believes new legislation could be approved between mid-February and mid-March.
In the case of the first round of checks under the CARES Act, the first direct deposits were made about three weeks after the Act was signed. In the case of the recently passed law, the period for processing deposits was reduced to about two weeks.
If the incoming Congress passes a new stimulus bill by mid-February, it is very likely that the first electronic payments will arrive in the accounts by the end of that month.