Senate Democrats are reportedly asking Treasury Secretary Steven Mnuchin to exempt stimulus checks from private debt collection.
Fourteen Senators led by Sen. Kamala Harris, D-Calif., on Friday sent a letter to Mnuchin urging him to issue regulatory rules to exempt the checks that are part of a $2.2 trillion coronavirus relief act.
"There are concerns that the direct assistance checks that Americans are receiving may be subject to private debt collection, which could potentially deprive Americans of essential assistance that they need in order to pay bills and keep food on the table," the Democrats wrote, according to The Hill, which reported that it obtained a copy ahead of its release.
"We ask you to act right away to use Treasury’s rulemaking authority to exempt Americans’ direct assistance payments from private debt collection so that American families can receive critical assistance to help them get through this unprecedented crisis," they wrote.
The coronavirus legislation passed last month provides $1,200 in direct assistance to individuals who make up to $75,000, with the amount scaled down for higher incomes An additional $500 per child is also included.
The Hill noted the letter follows an audio posted by The American Prospect. In it Treasury official Ronda Kent is heard discussing with banks how they should handle the coronavirus checks if the account holder had outstanding loans or debt. In the audio, Kent tells banks there’s "nothing in the law that precludes" the funds from being garnished and that it’s up to banks.
The first round of stimulus checks went out this week for individuals who’ve authorized the IRS to make a direct deposit into their bank accounts. Senate Democrats asked Treasury to complete rulemaking to protect the checks by April 24.
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