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Your next stimulus check may not be in the mail until Jan. 15

Treasury Secretary Steven Mnuchin said $600 payments may start going out next week. But many Americans may not get their funds that soon.

President Trump on Dec. 22 called on Congress to amend the coronavirus relief bill, asking for $2,000 stimulus checks and reduction of wasteful spending. (Video: Reuters)

It’s not going to be enough for many people, but the next stimulus payment will still help.

The $900 billion pandemic-relief bill Congress passed Monday night provides a second stimulus payment of $600 to individuals earning $75,000 or less and $1,200 for couples filing jointly earning $150,000 or less. Families are also eligible for $600 per dependent child under 17.

President Trump Tuesday night demanded larger stimulus checks in the bill and criticized it for “wasteful spending,” creating uncertainty about when — or if — the checks would still come.

Calculate how much you’ll get from the $600 (or more) coronavirus checks

But even before Trump’s intervention, based on glitches from the last distribution of stimulus payments, I need to manage your expectations.

And Treasury Secretary Steven Mnuchin should have done that, too, even though he was speaking before Trump’s surprising video.

“People are going to begin seeing this money next week,” Mnuchin said during a CNBC interview Monday.

This sets up the IRS for a herculean task.

The already-beleaguered agency is still trying to address backlogs from coronavirus shutdowns that sent its staff home. There are 2019 tax returns and refunds to process from the delayed 2020 tax season, which shifted its deadline to July 15 this year.

Dale Raby, 64, of Rockland, Wis., is caring for his severely autistic 24-year-old son. He received his $1,200 stimulus payment under the Coronavirus Aid, Relief and Economic Security Act, or Cares Act, passed in March, but he’s still waiting on a refund from his 2019 federal return, which he said he filed electronically in February.

“It’s very frustrating,” he said. “The IRS is sitting on more than $4,000 of money I could really use about now. You call and wait for hours, and when you finally get somebody they say, ‘We are way behind.’”

The new stimulus payments are based on people’s 2019 returns.

Under the Cares Act, the Treasury Department has until Dec. 31 to finish issuing the first economic-impact payments.

It’s possible people will see the second stimulus payment by direct deposit by year end, but the reality is many others probably won’t get any money before mid-January or even later next year. This all has to happen, I might add, while the IRS is preparing for the 2021 tax season, which is already going to be a hot mess because of the pandemic.

The relief bill says the Treasury Department has until Jan. 15 to get out the $600 payments. If payments can’t be direct-deposited or mailed by then, people will have to wait to get their money when they file their 2020 tax return next year. Even those who file just as the tax season opens may not see a payment until February. If you file your return electronically and elect direct deposit, it can still take about three weeks to get a refund.

The first stimulus rollout had some major glitches. Deceased people got checks. Foreign nationals received stimulus money even though they were not living or working in the United States. People in prison who received stimulus payments were told to send the money back to the IRS. Then a lawsuit filed against the IRS and Treasury Department reversed that policy decision, so payments to incarcerated individuals had to be reissued. By the way, the most recent bill does not exclude prison inmates from receiving stimulus payments.

The IRS lost stimulus payment information for hundreds of thousands of low-income Americans. Parents receiving certain government benefits — such as Supplemental Security Income — didn’t get the $500 payments for their eligible children, prompting another lawsuit. As a result, the IRS set and extended and then pushed out again deadlines for these parents and others to get their stimulus money.

The Treasury Department mailed prepaid debit cards to millions of Americans. But many people thought the cards were a scam and threw theirs away, prompting the department to send a letter that the debit card was in fact not fake.

This brings me to the optimistic proclamation from Mnuchin that the $600 payments would go out as soon as next week.

Here's what's in the new $900 billion stimulus package

The IRS has worked out a lot of the glitches troubling the first stimulus distribution, said Garrett Watson, a senior policy analyst at the Tax Foundation, which has a good summary of the new aid package.

“Yet, I think it’s always good to set reasonable expectations,” Watson said. “It’s better to underpromise and overdeliver when it comes to delivering these payments.”

The IRS could not address many questions, because the legislation had not yet been signed into law.

My holiday hope is that the IRS and Treasury Department post answers to the questions I know people will have, as soon as possible. The administration was too slow to do this after the passage of the Cares Act. The need is as great, if not greater, this time around to provide people struggling to make ends meet a realistic time frame for when they may see the second stimulus payment.