The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) includes a onetime cash payment of up to $1,200 directly to each eligible adult and $500 per child. Although Puerto Ricans are among those eligible for this payment, their payments were delayed as the U.S. Treasury Department had to take the extra step of approving a local distribution plan.
Direct payments were not feasible in Puerto Rico given the U.S. territory’s treatment under the U.S. Internal Revenue Code (IRC). Instead, the CARES Act called for U.S. funding to be provided to Puerto Rico Governor Wanda Vázquez Garced for payments to individuals. The law imposed this extra step for Puerto Rico and created a related delay that states did not face because the IRC is applied differently in Puerto Rico and other U.S. territories.
As the wait dragged on, fifteen members of Congress, led by Raul Grijalva (D-AZ), sent a letter to Steven Mnuchin, the Secretary of the U.S. Treasury, and IRS Commissioner Charles Rettig on April 30th. The letter called for the $1,200 stimulus checks, otherwise known as “Recovery Rebates” or “economic impact payments,” to be expedited for Puerto Ricans.
Puerto Rico was required to submit a plan for distributing the funds to eligible individuals and families in Puerto Rico, where most people are not required to file U.S.income taxes. Distribution of the payments in the States depended on income tax filings to provide bank information for electronic deposits.
“More than three weeks ago, on April 8, 2020, the Puerto Rico Treasury Department submitted to the U.S. Treasury and IRS a draft of their plan for review and comment,” the representatives wrote. “However, as of today the Government of Puerto Rico reports that the Puerto Rico Treasury Department has not yet received approval of the plan. Consequently, the island’s most vulnerable populations have not received the federal aid they need to pay their rent and put food on their tables during this economic and public health crisis. For this reason, we urge the U.S. Treasury and IRS to expedite the approval of the Government of Puerto Rico’s plan to utilize Section 2201 appropriated funds.”
The letter went on, “Second, we are concerned that more than 500 thousand SS, AABD, and VA beneficiaries in Puerto Rico have been excluded from receiving their Recovery Rebates automatically like their fellow citizens in the states. There is no logical reason for why these individuals have been excluded and are been discriminated against.”
Puerto Rico is eligible
Officially known as Economic Impact Payments, these funds are being sent to many U.S. adults. They begin to phase out for individuals earning $70,000 or more.
Carmen Yulin Cruz, Mayor of San Juan, claimed that “no one in Puerto Rico” had received a stimulus check days before the letter was written. Finance websites like The Balance have inaccurately said that people in Puerto Rico who didn’t file federal income taxes will not receive a payment. The Huffington Post reported last week that the local government is still working on their plan to get the funds to people who don’t file federal income taxes.
However, Governor Wanda Vazquez Garced announced last Monday that the payments have now been approved and are currently being distributed.
Resident Commissioner Jenniffer Gonzalez-Colon said, “I’m honored to have worked with my Congressional colleagues to include Puerto Rico in the rebate payments of the CARES Act, and to see it come to fruition today,” the congresswoman said. “I thank President Trump for his commitment to aid Americans during this time of economic distress and uncertainty. I also thank Secretary Mnuchin, and the teams at the Department of Treasury and the IRS for working with Secretary Pares and the Governor to review and approve this plan so that our constituents can rely on this federal aid as we, together, move forward to overcome this pandemic.”