Caribbean Net News: Puerto Rico begins to send out federal economic incentive payments

SAN JUAN, Puerto Rico: Thousands of Puerto Ricans will finally see some kind of financial relief as the Puerto Rico Treasury Department begins to send out federal economic incentive checks to some 72,000 public workers Wednesday.

At a news conference in San Juan, Governor Aníbal Acevedo Vila announced that the first $59 million of some $1.282 billion in federal economic incentive payments will be deposited into the accounts of government workers who receive their regular salaries through “electronic direct deposits.”

Anibal Acevedo Vila, governor of Puerto Rico.. Photo: Bloomberg News

The monies will begin to be deposited today and will continue through the summer.

Acevedo Vilá said that Treasury will be depositing some $719 million during the initial phase -- which includes monies going into the accounts of taxpayers who filed their income taxes in 2006.

Acevedo Vilá, who was accompanied by Treasury Department Secretary José Guillermo Dávila, added that the federal incentive checks are being handed out one week before the government had originally estimated.

“The Federal Department of Internal Revenues and the Puerto Rico Treasury Department had agreed that the reimbursements in the island would begin to be issued after May 19, but under the current Treasury Department Secretary leadership the process has moved faster and we are ready to begin (depositing the money) this week, just before Mother’s Day weekend,” Acevedo Vilá said.

The first deposits will be reflected in taxpayer’s accounts between Wednesday and Thursday, the governor said.

Other government workers -- who do not participate in the direct deposit program but rather receive their checks and later deposit them into their corresponding bank accounts -- will begin to receive the reimbursements on Saturday.

In addition, Acevedo Vilá said that some 25,000 public workers will start receiving the federal incentives monies by May 16. A total of $20 million will be disbursed during the second round of checks of federal incentives.

The remaining taxpayers, whom do not work for a government entity, will begin to receive their monies during the month of June.

Acevedo Vilá said that low-income taxpayers checks will be disbursed first.

The governor pointed out that once the federal incentives begin to be mailed out to taxpayers, some 25,000 checks adding up to $640 million will be sent out daily during the next 32 days.

The initial phase of federal reimbursements should be completely sent out to taxpayers by the third week of June, by which time some $719 million out of the of the $1.2 billion will have been disbursed.
A total of 900,000 taxpayers -- mostly working middle class citizens - -will benefit by the federal incentive.

The federal reimbursement is granted to citizens based on the tax returns filed in 2006, but veterans and retired workers who receive Social Security checks will receive the monies based on the information Treasury has from 2007.

According to the federal tax rebate method all individuals who earned less than $75,000 annually and all married couples who earned a combined $150,000 will receive the reimbursement.

The tax rebate method states that all taxpayers earning up to $75,000 per year are eligible to receive some $600 and married couples earning a combined $150,000 are eligible to receive up to $1,200. An additional $300 will be granted to taxpayers with children. The $300 is given per child; in other words, if a family has five children the couple will receive $1,500 for all their children.

However, moments after the governor made the announcement, Senate President Kenneth McClintock and Senate Treasury Commission Chairwoman Migdalia Padilla chastised the same, charging that the federal reimbursement will not be distributed in advance but rather later than expected.

McClintock stated that the federal monies had arrived at the Government Development Bank of Puerto Rico two weeks ago, and questioned why they have yet to be disbursed.

“The federal reimbursement is over due, it’s not being given early as the governor stated,” McClintock said.

McClintock added that the reimbursements could be handed out later than expected due to discrepancies between the Social Security numbers of taxpayers in Puerto Rico and the numbers registered at the US Social Security Administration.

“There are severe discrepancies between the Puerto Rican taxpayers Social Security numbers and those registered at the federal Social Security Administration,” McClintock said.

The Senate President added that one of the “conditions established” by US Treasury was that each recipient’s Social Security number had to be verified.

McClintock added that the Acevedo Vilá administration had “promised” US Treasury that the checks would begin to be disbursed after May 4 not May 19 as the governor announced.

On Wednesday, Dávila acknowledged that out of 2.9 million taxpayers, whose Social Security numbers were verified in order to qualify for the federal reimbursement about 29,700 “were not validated.”

The Commonwealth’s Treasury Secretary said that the reason that some 29,700 taxpayers Social Security numbers were invalid could be due to involuntary errors made by the taxpayer while filing taxes in terms of making a mistake when writing down their Social Security number.

Dávila denied that the taxpayers Social Security numbers were not validated due to fraudulent acts.
He said that the affected taxpayers will receive a letter of notification from Treasury asking them to clear up the situation and give the corresponding Social Security number.