How a Fourth Stimulus Check and Other Federal Payments Could Head Your Way in 2021

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The third round of stimulus payments have been hitting bank accounts and mailboxes for the last month, and the IRS is continuing to issue checks to those who qualify. While not every American who qualifies has received their check yet, the IRS has made impressive headway over the past two months.

The $1,400 stimulus checks started rolling out in March, shortly after the third stimulus bill was signed into law by President Joe Biden. By the third week of April, the IRS had sent out more than 159 million stimulus checks, totaling about $376 billion in direct payments made to Americans in need.

And, the IRS isn’t done yet. The federal agency is continuing to send out checks to those who qualify for this round of payments, along with supplemental payments, known as “plus-up” payments, for some Americans. This cash infusion will help Americans make ends meet after millions faced serious financial hardships due to the pandemic. But what happens after this round of payments — and the plus-up payments — are distributed? Will more money be on the way? Here’s what could happen, and what direct payment money could be headed your way from the federal government in 2021.

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Will a fourth stimulus check happen?

The buzz over a fourth stimulus payment started in late March, when over 60 Democratic U.S. representatives — including Elizabeth Warren, Ilhan Omar, and Bernie Sanders — signed a letter asking the president to issue recurring checks to Americans throughout the pandemic. The main purpose of these proposed checks is to help Americans cover their bills and other expenses as the economy recovers from the COVID-19 pandemic.

That letter from lawmakers called for the president to send “equal payments to adults and dependents, prioritize those who need it most and will spend it quickest, and include older dependents such as disabled and elderly dependents and those over the age of 16 still claimed as dependents.”

This push for ongoing payments gave hope to millions of Americans who are struggling with the fallout of the pandemic. And, while the idea is in its infancy, there is a chance that it could happen. The fact that there are Democratic members of the House and Senate who support the idea of more direct stimulus payments makes it more likely that other lawmakers will sign on and offer support to the idea of ongoing payments.

That said, whether or not a fourth stimulus check, or recurring checks, will actually happen remains to be seen. The reality is that while there is a lot of Democratic support behind this push for recurring checks, there are going to be pretty significant hurdles that any bill including recurring checks would need to clear, including bipartisan support — which was already difficult to garner with the third stimulus bill.

What other payments could happen in 2021?

While the idea of a fourth stimulus payment is getting most of the buzz, there could be other types of stimulus and direct payments that happen over the next year. These could include:

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A hike in federal minimum wage

The battle for a hike in federal minimum wage isn’t over. While the proposed minimum wage hike was ultimately eliminated from the third stimulus bill in order to expedite the passage of the bill, there are still senators pushing for a change to the $7.25 per hour federal minimum.

A number of lawmakers have pushed for hikes, and Mitt Romney and Kyrsten Sinema are the two latest senators to push for a hike to the federal minimum wage. The idea is to raise the federal minimum wage to somewhere between $11 and $15 per hour in order to level the playing field for lower-income workers employed by the federal government.

Extended federal unemployment benefits

The extra $300 per week that unemployed individuals have been receiving from the federal government was initially slated to end in mid-March, but the most recent stimulus legislation included another expansion of federal unemployment benefits. That’s a huge relief to the 10.6 million Americans who were slated to lose the expanded unemployment benefits at the start of April.

Qualifying Americans will now receive the extra $300 boost each week — on top of state unemployment benefits — through early September of this year. That may not be long enough to tide people over and allow them to recover from the financial strain imposed by the pandemic, though.

The Democratic senators who are pushing for recurring payments have also requested that Biden extend federal unemployment assistance beyond September, which would make it a lot easier for cash-strapped households to make it through the pandemic relatively unscathed.

This extended federal employment boost is just an idea being pushed to Biden right now, but it could receive some traction in time with enough lawmaker support. If it does, it could be extremely beneficial to the wallets of unemployed workers who are facing a tight job market and other hurdles due to the pandemic.

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A permanent Child Tax Credit increase

One of the lesser buzzed about parts of the third stimulus bill is the Child Tax Credit increase, which was expanded from an annual tax credit claimed on tax returns to a periodic payment for lower- and middle-income families.

Under the temporary expansion, the 2020 limits on the Child Tax Credit have increased from up to $2,000 per child to a maximum of $3,600. It’s not completely cut and dry, but the gist of this expansion is that children aged 5 and under who qualify will be eligible for a total maximum payment of $3,600, while children between 6 and 17 years old will qualify for $3,000 maximum. In addition, 18-year-olds and full-time college students ages 24 and under may be eligible for a $500 one-time payment.

Those who qualify will either receive seven checks over the upcoming 12 months for the Child Tax Credit, or one big check during tax time (if they opt out of the smaller monthly payments). These smaller checks would make it a lot easier for low-income families to make ends meet — especially if the increase becomes permanent.

And, while that may seem unlikely, it’s actually a move that Biden supports. According to White House Press Secretary Jen Psaki, President Biden wants to make the Child Tax Credit permanent, and other lawmakers, including Romney, also support this move to help pull families out of poverty.

Again, whether that happens remains to be seen, but it could be more likely than recurring checks or other direct payments, which have been widely opposed by Republican lawmakers in recent months.

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