Millions of Americans can finally expect to see second stimulus checks in their bank accounts soon.
This time, however, those payments will be up to $600 per person for those eligible — half the $1,200 that was sent in the first round of checks in the spring.
The new one-time checks are part of a coronavirus aid deal Washington lawmakers said they had struck on Sunday. News of a package follows months of negotiations between Republicans and Democrats on how much total help should be provided and what areas should qualify for more relief.
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Areas that made it into the $900 billion draft legislation include $300 per week in enhanced federal unemployment benefits. Programs that extend unemployment insurance eligibility will also be renewed.
Struggling individuals and families will also benefit from new rental assistance and a federal eviction moratorium extension. Supplemental Nutrition Assistance Program, or SNAP, benefits will also get a boost.
More Paycheck Protection Program small-business loans will make it into the package, as well as funding for Covid-19 vaccine distribution, hospitals, schools and colleges.
Here’s the details we know so far on the second stimulus checks.
How much will the stimulus checks be?
The new checks will be $600 per adult and $600 per child.
In contrast, the first stimulus checks were $1,200 per individual or $2,400 per married couple filing jointly, plus $500 per child under 17.
As with the first payments, you will have to meet certain income thresholds to qualify. Individuals with up to $75,000 in adjusted gross income, for example, will receive full payments, as will heads of household earning up to $112,500 and married couples making up to $150,000.
The payments will phase out gradually for income above those levels. Because the CARES Act stipulated a rate at which payments were reduced, tied to increasing levels of income — rather than specific payment amounts tied to specific incomes — it remains to be seen if the phase out amounts will be lower, said Garrett Watson, senior policy analyst at the Tax Foundation.
If the legislation’s language is unchanged from the CARES Act, for example, single taxpayers would see their payments phase out at $87,000, rather than $99,000, he said.
Adult dependents could be excluded again this time around, according to the latest reports.
Who will receive the payments first?
Once the bill passes, the government will get to work sending out the money.
On Monday, Treasury Secretary Steven Mnuchin told CNBC that the first payments should start to arrive at the beginning of next week.
That would include people who have their direct deposit information on file with the IRS, Watson said.
People who have not shared that information with the government or who will receive paper checks will likely have longer waits.
When the first checks were deployed, one Congressional timeline estimated it would take up to 20 weeks to get the money out. However, millions of people who are eligible then still have not received the money.
“Overall, big picture, it does sound like it will happen a bit faster than the last round,” Watson said.
Why are the checks $600, not $1,200?
Last Friday, two senators — Josh Hawley, R-Mo., and Bernie Sanders, I-Vt. — took to the chamber floor to request an up-or-down vote for $1,200 second stimulus checks per individual and $2,400 per married couple, plus $500 for children.
Both times, they were rejected by Sen. Ron Johnson, R-Wis., who said he thinks the direct payments cover broad swaths of Americans who are not experiencing joblessness during the pandemic. About 115 million households received the first stimulus checks, Johnson said, while an estimated 9 million to 11 million people are currently unemployed.
The HEROES Act, passed by the House of Representatives in May, called for $1,200 stimulus checks.
Both President Donald Trump and President-elect Joe Biden have also called for higher sums than $600 per person.
“This is more in line with the dollar amount that has been done historically when they have pursued this,” Ed Mills, Washington policy analyst at Raymond James, said of the $600 checks.
“It will be enough for some consumers and not enough for others,” he said.
Could there be more payments in the future?
More aid could be on the horizon.
“We need to get this done now,” Senate Minority Leader Chuck Schumer, D-N.Y., tweeted of the relief bill. “And then we need to do even more under President Biden.”
Much of how future relief, if any, shapes up will depend on the success of the vaccine rollout and other efforts to combat Covid-19’s spread.
In a statement on the new relief package, President-elect Biden outlined a series of steps he plans to take to address the pandemic once he takes office.
“Immediately, starting in the new year, Congress will need to get to work on support for our Covid-19 plan, for support to struggling families, and investments in jobs and economic recovery,” Biden said. “There will be no time to waste.”
This is a developing story. Please check back for updates.
