A new study from the U.S. Department of the Treasury, U.S. Census Bureau and Internal Revenue Service found the first wave of economic impact payments provided under the 2020 Coronavirus Aid, Relief and Economic Security Act effectively reached underserved communities and Americans most in need.
In order to look into potential disparities in the receipt of these payments by race and ethnicity, a group of researchers from the Treasury Department, Census Bureau and IRS published a working paper that analyzes the demographic breakdown of economic impact payment recipients, according to a May 9 news release. These payments were made in an effort to lessen the pandemic's negative economic effects.
“Today’s research reflects work by multiple agencies to understand how government policies and programs have impacted different communities," Assistant Secretary of Treasury Wally Ademeyo said in the release. "This research will be instrumental as we develop, design and implement fair and equitable policy responses to potential future economic shocks."
According to this data, 55% of those who received an economic impact payment did so within the first week that payments were provided, and 95% did so within six weeks. Economic impact payments were distributed more swiftly to younger people, families with lower incomes and families with children, probably as a result of the greater frequency of direct deposit of tax refunds for these groups, the release said.
Payments were initially delivered electronically to people who got a refund by direct deposit on the tax return used to create their payment in order to issue payments as fast as possible, as required by the CARES Act, the release reported.
In comparison to white, American Indian and Alaska Native, Black or Asian beneficiaries, 60% of recipients who identify as multiracial, Hispanic or Native Hawaiian or Pacific Islander received a payment in the first week, according to the release. However, more than 90% of payments were made within the first six weeks to every racial/ethnic subgroup the authors looked at, with white and Asian recipients having the highest likelihood of doing so.
This study provides valuable insights into the effectiveness of the CARES Act in providing economic relief to those most in need, the release reported. It also highlights the importance of understanding and addressing potential disparities in the distribution of government assistance.
