Home  »  Finance   »   Troops to Receive Stimulus Checks and More Payback Time for Deferred Taxes

Troops to Receive Stimulus Checks and More Payback Time for Deferred Taxes

troops stimulus checks and more payback time

Troops to Receive Stimulus Checks and More Payback Time for Deferred Taxes

Update: On December 20th, 2020, President Donald Trump signed the $900 Billion Stimulus Package into law. This gave most Americans a $600 stimulus check. As of February 2021, there are plans for a third stimulus check which could end up being $1,400 per person. 

This past holiday season, a vast number of Service Members, Veterans, and their families received (or will soon receive) one-time stimulus checks of $600 under the trillion-dollar federal funding package and COVID-19 relief bill President Trump signed into law. However, Senate Majority Leader Mitch McConnell on Wednesday introduced his version of a bill to increase significantly the $600 stimulus checks from the coronavirus relief package to $2,000, something that both the Democratic Party and President Trump have provided strong verbal support of the increase. On Tuesday, McConnell blocked attempts by Schumer and Sen. Bernie Sanders, I-Vt., to quickly pass the House bill on stimulus checks that cleared the lower chamber with more than two-thirds of members voting in favor of it Monday.

Whether the House bill or the McConnell bill even receive votes will be up to McConnell, who controls the floor’s action. The majority leader is currently prioritizing efforts to override Trump’s veto of the National Defense Authorization Act (NDAA), which provides funding for the military throughout the next year. The current Congressional session ends on Sunday, Jan. 3, which means that any movement on stimulus relief checks must happen rapidly. At that point, lawmakers will have to restart the legislative process completely.

The current relief proposal calls for direct payment of $600 to eligible Americans, plus $600 per dependent child. Under the plan, those earning up to $75,000; $112,500 as head of household; or $150,000 as a married couple filing a joint tax return qualify for the full payment. However, many Service Members, veterans, and other affected personnel have shown great frustration at the relief payment, saying the amount is not nearly enough to help with financial stress during the pandemic. The legislation also allots $696 billion in non-emergency discretionary spending for the DoD for fiscal 2021. It includes several provisions for military personnel and families above the president’s budget request, which was released earlier this year. This consists of an additional $116 in upgrades to childcare facilities, an extra $284 for on-base schools, and a sum of $1.5 billion for environmental restoration programs — $430 million more than requested.

In addition to the Covid-19 stimulus relief funds and defense spending, federal employees and Service Members will have a much easier time paying back the Social Security taxes that have been deferred from their federal paychecks since mid-September. This is in thanks to a provision tucked inside the massive omnibus spending package.

The provision will allow personnel impacted by President Trump’s payroll tax deferral to pay back the taxes — worth 6.2% of their income — throughout the entire year of 2021, rather than a four-month window. At the same time, information about the payment program and the expectations for federal employees and service members to pay back the deferred taxes has been relatively lacking and vague at best. According to national payroll providers, the general plan was for employees to begin paying the deferred taxes back between January and April 2021. Now, federal personnel and service members will have 12 months rather than the original four to repay previously deferred taxes.

The payroll tax deferral resulted from an executive memo President Donald Trump signed back in August. The White House administration packaged the program as a tax holiday and paycheck boost for American workers during the COVID-19 pandemic, but very few private-sector employers chose to implement it. The tax deferral was mandatory for most federal employees and military members whose gross; biweekly wages were $4,000 or less. The deferral was received with mixed reviews due to the inability to opt-out of the taxes by Service Members.





About the author

+ posts

Julie Provost is a freelance writer, and blogger. She lives in Tennessee with her National Guard husband and three boys.