If you’ve been counting down the moments until you get your hands on another $1,200 stimulus check, you’re probably feeling very disappointed. Negotiations on another stimulus package continue to be at a standstill, and that’s even though unextended unemployment benefits included in the CARES Act expired on July 31st.
There is plenty of hope a deal could be reached in the next few weeks, but the second round of stimulus could look entirely different than the first.
For example, it’s possible the next round of stimulus payments could come in at the same $1,200 for individuals and their dependents, but there’s also a chance individual payment amounts will be less robust.
$600 Unemployment Checks And Second Stimulus Check Update …
Here’s what we know so far, and some updates on the assistance you could receive from the federal government over the coming weeks and months.
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First off, where are we now? While new coronavirus cases appear to be slowing down nationwide and the stock market is definitely on an upswing, Morning Consult economist John Leer writes that we are not out of the woods yet when it comes to the economy.
According to recent analysis, as many as 5.4 million unemployed Americans may not be able to cover living expenses without some help in the form of extended unemployment benefits by the end of August. This includes regular bills most Americans have, ranging from their rent payments to groceries, auto payments, and insurance Without more assistance, 9.2 millions could face the same fate by the end of September, Leer notes.
It is also crucial to understand that job losses caused by COVID-19 have not stopped, meaning the financial pain felt by Americans could get even worse. “As the virus spreads and employers shrink their workforces, more Americans will become unemployed,” writes Leer.
With more bad news potentially on its way, the next round of economic stimulus may not even be the last.
What Happens Next
Congress is still debating inclusions on a final package, yet Republicans and Democrats appear to be far from reaching a compromise. Plenty of proposals have been suggested on both sides of the aisle, yet they’re all slightly unique and the price tags for each vary by billions of dollars.
The HEALS Act, which was proposed by Senate Republicans in July, would include $1,200 in stimulus payments to individuals and $500 per qualified dependent, which mimics payments made in the CARES Act which passed in March. This act also includes extended unemployment benefits, small business support, increased spending on education and healthcare and more. The cost of the HEALS Act, as originally proposed, would be $1.1 trillion.
However, the HEROES Act, which was passed by House Democrats in May, would give individuals $1,200 each and another $1,200 for dependents. However, the HEROES Act limits dependents to three, so the maximum a family could receive is capped at $6,000. At over $3 trillion dollars, the HEROES Act also includes a range of benefits meant to help bolster small businesses, provide student loan debt relief, reduce taxes and more.
Another idea, called the Coronavirus Assistance for American Families Act, would include $1,000 stimulus payments for individuals and dependents. This plan would use the same formula as the CARES Act to phase out high earners, with individuals earning $75,000 or more and couples earning over $150,000 per year seeing their stimulus payment phased out. While stimulus payments would be lower with this plan, families with children stand to benefit more due to the higher payment for each dependent.
Obviously, it will take more negotiation for Congress to reach a compromise of these options and others that have been proposed, yet we don’t know how quickly an agreement might be reached.
In the interim, President Trump has stated an executive order may be on its way to handle some of the most pressing issues Americans face. His executive order could include a payroll tax cut, unemployment benefits to replace the $600 unemployment checks that expired on July 31st, protection from eviction for renters and homeowners, and extended student loan repayment benefits.
The Bottom Line
If you’re eagerly awaiting another stimulus payment or news on extended unemployment benefits, all you can do is wait it out. The same can be said if you’re stuck wondering if interest on your federal student loans will begin accruing again beyond September 30th, and if you’ll have to start making payments again. It’s always possible an agreement could be reached by Congress next week, but nobody knows for sure.
With 30 million Americans losing out on the additional $600 in weekly unemployment benefits they were receiving as of July 31st, time is of the essence. Only time will tell what the next stimulus package will look like, what it will include, and who will be helped the most.