Are second $1,200 stimulus checks coming? Here’s what we know

Personal finance

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Capitol Hill has come to a standstill following heated discussions last week on what to include in the next coronavirus stimulus package.

One thing they did seem to agree on was another set of $1,200 checks to Americans, similar to the payments that went out this spring.

While Treasury Secretary Steven Mnuchin has said he wanted to start getting those second checks out this month, that seems more and more unlikely the longer that Congress fails to seal a deal.

“What I would say to people is there is still a pretty good chance that you’re going to get these payments,” said Howard Gleckman, senior fellow at the Urban-Brookings Tax Policy Center. “But it’s impossible to know when or how long it’s going to take.”

Who could be included in the second $1,200 checks

Both Senate Republicans and House Democrats included another round of $1,200 payments to Americans in their respective stimulus bills.

The payments would be largely based on the CARES Act, which authorized the first payments.

There could, however, be some changes. Both proposals call for $1,200 to individuals and $2,400 for couples, in line with the first checks.

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But who qualifies as dependents and how much they receive could be up for debate.

The first round of checks included $500 for those age 17 and under. Lawmakers on both sides of the aisle have pushed for including all adults this time around, particularly those over 17, which would give college students and disabled individuals a financial boost.

There are also discussions whether to raise dependent pay from $500, and by how much.

When the payments could realistically be sent

Getting the payments out in August could be tough, as lawmakers don’t seem eager to return to the negotiating table.

One optimistic scenario would be if Congress were able to say a deal had been reached this Friday. In that case, Gleckman said, the Treasury Department could move to get the money out sooner because it now has experience sending out the payments.

“I think they could at least get the direct deposit money out pretty quickly,” Gleckman said. “Whether they could do it two weeks from now, I don’t know.”

First payments, therefore, would probably start arriving in September at the earliest.

House Speaker Nancy Pelosi, D-Calif., said on Wednesday that Democrats and the White House are “miles apart” in negotiations. It’s unclear as to when negotiations may continue.

Why other aid may come first

President Donald Trump moved to shore up other aid over the weekend by signing four executive orders.

Those addressed unemployment benefits, potential relief for renters, student loan payment deferrals and a payroll tax holiday for workers.

But the president did not include stimulus checks, though he has said he supports them.

“You can’t make the Treasury write checks with money it does not have,” Gleckman said. “Had he been able to do it with an executive order, he would have.”

Now the government must figure out how to deploy those executive orders, particularly when it comes to unemployment benefits, which are to be paid both by federal and state governments.

Some economists say that other aid should be a priority ahead of stimulus checks, which they say don’t necessarily target those who have been directly impacted by the coronavirus.

“We need to prioritize making sure there’s enough cash that the businesses can hang onto their employees, that families that have lost their jobs can get through these times,” said Dr. Wayne Winegarden, senior fellow at the Pacific Research Institute.

“Every dollar that you spend not doing that is a waste, is not helpful for the recovery, and makes it that much more difficult to help those who need help,” he said.

Both political parties are scheduled to hold their national conventions this month, which leaves less time to get a deal done. Meanwhile, the financial fate of millions of Americans is up in the air.

Washington politicians are likely feeling the pressure, Gleckman said.

“It’s got to be incredibly frustrating for people,” Gleckman said. “They’ve got to be pretty angry at Washington right now, and you can’t blame them.”

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