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2,000,000 Americans Will Soon Lose ‘Enhanced’ Unemployment Benefits

President Joe Biden, joined by Johnson and Johnson CEO Alex Gorsky and Merck CEO Ken Frazier, delivers remarks on COVID-19 vaccine production Wednesday, March 10, 2021, in the South Court Auditorium in the Eisenhower Executive Office Building at the White House. (Official White House Photo by Adam Schultz).

As the final batches of $1,400 coronavirus stimulus checks reach the bank accounts of cash-strapped Americans, a different government-issued financial lifeline is being taken away from nearly two million individuals.

Enhanced Unemployment Benefits Are Going Away

As of Friday, at least sixteen states—all led by Republican governors—had announced that they would halt their participation in a supplemental unemployment program that paid an extra $300 a week to eligible recipients.

The states include Alabama, Arizona, Arkansas, Georgia, Idaho, Iowa, Mississippi, Missouri, Montana, North Dakota, Ohio, South Carolina, South Dakota, Tennessee, Utah, and Wyoming.

Several of these states have decided to cut off benefits as early as June 12, while others have set a date as late as July 10. President Joe Biden’s American Rescue Plan will continue to offer the aid till early September.

In response to the move, many of the state officials have contended that the enhanced benefits are creating labor shortages because they say many of the beneficiaries are receiving more money not to work.

“Every small business owner and the workers that are currently working, they need more people,” Georgia Gov. Brian Kemp said on Thursday.

“It is hurting our productivity not only in Georgia, but across the country,” he added.

South Dakota’s Labor and Regulation Secretary Marcia Hultman recently noted in a statement that “businesses across the state continue to say they would grow and expand, if it wasn’t for the lack of workers. Help wanted signs line our streets.”

She continued: “South Dakota is, and has been, ‘Open for Business.’ Ending these programs is a necessary step towards recovery, growth, and getting people back to work.”

However, proponents of the enhanced benefits say that coronavirus-related factors, such as the relatively low vaccination rates, are still the main reasons behind the worker shortages.

What Help Is Left?

Despite these actions by some states, individuals who received unemployment benefits last year will still be in line to receive tax refunds beginning later this month. This is due to Biden’s $1.9 trillion legislation, which was able to waive federal tax on up to $10,200 of unemployment benefits—or $20,400 for married couples filing jointly—that were collected in 2020. Households, though, with $150,000 or more in earned income are ineligible for the new benefits.

The Internal Revenue Service has confirmed that the first of these refund checks are slated to be sent out some time this month and will continue throughout the summer. The agency has yet to provide an exact timeline.

A recent Treasury report has revealed that well over seven million tax returns processed by the IRS will be eligible for these new tax refunds. “Of the 7.4 million tax returns, nearly 7.3 million—or 98.6 percent—had modified adjusted gross income of less than $150,000 and would likely qualify for the exclusion,” the report wrote.

Ethen Kim Lieser is a Minneapolis-based Science and Tech Editor who has held posts at Google, The Korea Herald, Lincoln Journal Star, AsianWeek, and Arirang TV. Follow or contact him on LinkedIn.

Written By

Ethen Kim Lieser is a Minneapolis-based Science and Tech Editor who has held posts at Google, The Korea Herald, Lincoln Journal Star, AsianWeek, and Arirang TV.

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