Congressmen Panetta Urges Administration to Provide COVID-19 Response Direct Payments to Families with Newborns

April 2, 2020
Press Release

SALINAS, CA – Today, Congressman Jimmy Panetta (CA-20) led 27 bipartisan lawmakers in sending a letter to U.S. Department of Treasury Secretary Steven Mnuchin and Internal Revenue Service (IRS) Commissioner Charles P. Rettig urging the agencies to ensure parents with children born in 2020 are able to access advance direct payments for these children as part of the coronavirus emergency response aid. 

The Coronavirus Aid, Relief, and Economic Security (CARES) Act currently includes immediate, direct cash payments to lower-and middle-income families of $1,200 for each adult and $500 for each child up to 17 years of age.  Eligibility for the automatic, advanced payments are determined by information provided in families’ 2019 or 2018 tax returns.  Unfortunately, for parents that had children after January 1, 2020, there is no way to inform the Treasury or the IRS that they are eligible for up to an additional $500 per child.  While they may reconcile this on their 2020 tax return, waiting until 2021 does not help these parents now.

“To help these families at such a critical time in their children’s lives, we ask that Treasury and the Internal Revenue Service (IRS) create a process for new parents to inform the IRS of children born in 2020 and ensure that they receive any additional direct payments for which they are eligible as soon as possible. The birth of a child should be a time of joy for families. We should do everything we can to ensure they are treated fairly and can access these payments as they face increasing health and economic challenges,” the members wrote. 

Full text of the letter here and below:

 

Dear Secretary Mnuchin and Commissioner Rettig:

We write today urging you to ensure that families who have welcomed children into the world at this difficult time can receive expedited direct payments created by recent legislation, regardless of their family size prior to this year.

The Coronavirus Aid, Relief, and Economic Security (CARES) Act provides direct payments of $500, subject to the income limitations, per qualifying dependent. While the total amount of payments in the legislation is based on a family’s eligibility in 2020, the Department of the Treasury (Treasury) has been instructed to use 2019 tax return information (or 2018 tax information if no 2019 information is available), in order to transmit advance payments out as soon as possible.

The legislation provides that, if their family grows in 2020, recipients may receive the difference when they file their 2020 tax returns. However, those returns will not be filed until 2021, and will not benefit affected families at their moment of greatest need.

Families who are having children this year are facing not only increased expenses to care for their newborns, but also added personal and economic stress as they navigate new health risks and potential losses of income. Some of these parents are taking unpaid leave under the Family and Medical Leave Act of 1993 (FMLA), and others may be experiencing furloughs or loss of employment that further strain their finances.

These parents are disproportionately affected by the COVID-19 outbreak but will receive less than they are entitled to in their time of greatest need.

To help these families at such a critical time in their children’s lives, we ask that Treasury and the Internal Revenue Service (IRS) create a process for new parents to inform the IRS of children born in 2020 and ensure that they receive any additional direct payments for which they are eligible as soon as possible.

The birth of a child should be a time of joy for families. We should do everything we can to ensure they are treated fairly and can access these payments as they face increasing health and economic challenges.

 

Sincerely,

Issues: