President Joe Biden said Monday over 100 million economic impact payments will have been delivered to Americans within the next 10 days.
The cash payments, amounting to $1,400 for most recipients, are part of the American Rescue Plan that Biden signed into law last Thursday.
“Shots in arms and money in pockets. That is important,” Biden said in remarks at the White House, which came as his administration surpassed 100 million administered COVID-19 vaccines. “The American Rescue Plan is already doing what it was designed to do—make a difference in people’s everyday lives,” he added.
The Treasury Department said on March 12 that it had begun processing the economic impact payments, some of which started reaching people’s bank accounts over the weekend.
“Additional large batches of payments, which will be automatic and require no action by taxpayers, will be sent in the coming weeks by direct deposit and through the mail as a check or debit card,” the agency said in a statement.
Over 158 million households are expected to receive the cash payments, with people earning less than $75,000 eligible to receive the full $1,400 amount, which ramps down to zero at incomes of $80,000 and above.
“By the time all the money is distributed, 85 percent of American households will have gotten a $1,400 rescue checks,” Biden said.
There is a risk that some of the checks could be garnished by debt collectors, however. A coalition of consumer and banking groups recently urged Treasury Secretary Janet Yellen to take action to close a loophole in the $1.9 trillion pandemic relief bill that allows the direct payments to be seized to pay off debts.
The economic impact payments (EIP), as the stimulus checks were formally known, were shielded from garnishment under previous COVID-19 rescue bills. But the American Rescue Plan, which President Joe Biden signed into law on March 11, does not explicitly prevent debt collectors from seizing those funds.
The American Rescue Plan does not explicitly prevent garnishment since it was passed via the budget reconciliation process. Democrats advanced the bill through Congress through reconciliation, which allowed them to pass the bill without having to win over Republicans, who opposed the bill as wasteful and packed with spending priorities unrelated to the pandemic.
“Allowing economic impact payments to be garnished could impose significant burdens on some families, especially those in communities of color, facing unprecedented circumstances,” the organizations wrote, adding that depository institutions—and even many debt collectors—believe the stimulus checks should be exempt from garnishment.
Unless Congress passes a standalone bill to close the loophole, deposit-taking institutions like banks and credit unions will be forced to comply with garnishment orders and will have to pay some creditors who try to freeze bank accounts and seize owed funds.
Sen. Ron Wyden (D-Ore.) chairman of the Senate Finance Committee, said in a statement that he plans to introduce a standalone bill that would shield the money from debt collectors.