Examining Equity in COVID-19 Stimulus Payments

Joint Federal Research Found That More Than 90% of Potentially Eligible Individuals Received Stimulus Payments

May 11, 2023

Written by:

Erika Becker-Medina, Leah R. Clark, Amanda Eng, Nikolas Pharris-Ciurej and John Voorheis

More than 90% of potentially eligible individuals received pandemic-related stimulus payments but receipt varied across race and ethnic groups, according to recently published joint federal research.

Among the four largest race/ethnic subgroups of the potentially eligible population (Non-Hispanic White, Non-Hispanic Black, Non-Hispanic Asian and Hispanic of any race), Hispanic individuals had the lowest receipt rate (87%) and non-Hispanic White individuals the highest (94%).

In addition, lower-income individuals and families with children received payments earlier than higher-income individuals and families without children.

Lower-income individuals and families with children received payments earlier, indicating that the way the IRS prioritized payments was effective.

The research published May 8 investigates whether there were disparities in the disbursement of federal Economic Impact Payments (EIPs) as part of a broader effort related to Executive Order 13985, Advancing Racial Equity and Support for Underserved Communities Through the Federal Government.

What Are Economic Impact Payments?

The onset of the pandemic in March 2020 sparked three rounds of EIPs:

The Coronavirus Aid, Relief and Economic Security (CARES) Act created the Recovery Rebate Credit for tax year 2020.
The Consolidated Appropriations Act (CAA) of 2021 created an Additional 2020 Recovery Rebate Credit in December 2020.
The American Rescue Plan (ARP) Act of 2021 created a Recovery Rebate Credit for tax year 2021 in March of that year.

The research focuses only on the first-round EIPs: payments of $1,200 per eligible individual and $500 per qualifying child established by the CARES Act and issued between April 2020 and December 2020.

To measure whether EIP disbursements were equitable, the Census Bureau, IRS and U.S. Department of the Treasury joined forces through the Equitable Data Working Group. These federal agencies combined data sources — while still protecting the privacy of individuals — to conduct statistical analyses of the EIPs. The IRS is the only federal agency with information on the receipt of EIPs and the Census Bureau the only one with race and ethnicity data.

Researchers examined the disbursement of the stimulus payments by race/ethnicity, age, sex, income and household composition.

The paper focuses on two measures of EIP disbursement by demographic group: the receipt rate and the timing of payments to recipients.

The researchers estimated the receipt rate as the number of recipients as a share of the potentially eligible population — and defined the potentially eligible population as individuals who, based on Census Bureau modeling, might have met the criteria to receive a payment. While the method for identifying who was potentially eligible has some shortcomings, an estimate of the size of this group is still useful for identifying if disparities existed across demographic groups.

Researchers leveraged the census demographic data by linking it to the IRS administrative tax data for individuals and tax units (individuals who file taxes together) to arrive at the results. The information was connected inside the Census Bureau firewall.

What the Research Shows

Overall, 92% of potentially eligible individuals received EIPs: non-Hispanic White individuals were most likely to receive an EIP (94%) and Hispanic individuals and those classified as Some Other Race had the lowest (87% and 83%, respectively) receipt rates (Figure 1).

With respect to timing, 95% of recipients received payments in the first six weeks of the program and more than half (55%) in the first week of the program (Figure 2).

In addition, 90% of every race/ethnic subgroup received payments within six weeks of when EIP disbursement began, but Non-Hispanic White and Non-Hispanic Asian recipients were most likely to receive their EIPs within the first six weeks.

Lower-income individuals and families with children received payments earlier, indicating that the way the IRS prioritized payments was effective.

Figure 1. Share of Potentially Eligible Population That Received First-Round Economic Impact Payments by Race/Ethnicity: 2020

Figure 2. Timing of First-Round Economic Impact Payments by Race/Ethnicity: 2020

This research project and the detailed tabulations have provided a unique test case for the ability of federal agencies to rapidly conduct joint research to gauge the equity of the administration of assistance programs. The joint effort was possible because it linked confidential data along with the associated privacy protections, data use agreements and access controls.

Erika Becker-Medina is senior advisor to the Census Bureau’s chief scientist and associate director of the Research and Methodology Directorate.

Leah R. Clark and Amanda Eng are economists in the Census Bureau’s Center for Economic Studies.

Nikolas Pharris-Ciurej is assistant center chief for demographic research in the Center for Economic Studies.

John Voorheis is principal economist in the Center for Economic Studies.