CORONAVIRUS

Second stimulus check: payments would arrive quicker than first round

The IRS would be able to send out the payments quicker than the first round of stimulus checks if the HEROES Act can be agreed upon and passed.

Second stimulus check: payments would arrive quicker than first round

The $2.2 trillion CARES Act, passed in March, has seen millions of Americans receive an Economic Impact Payment (EIP) of up to $1,200 to help them cope with the effects of a pandemic. The coronavirus has led to the worst unemployment rates for decades. Over 40 million people in the United States have been forced to file for unemployment benefits over the past 10 weeks.

A number of polls have shown that this stimulus check is only going to get people in the country so far. 84% of respondents who took part in a recent survey carried out by MarketWatch said they would be needing another EIP.

Americans need economic relief and they need it now. The good news is that if a second stimulus check is to be agreed upon, it would likely be sent out and delivered sooner than the first round of payments. There were a number of logistic problems with the first round like deceased people receiving checks and checks being sent to the wrong addresses.

Second stimulus check would be sent out quicker

In fact, there are still Americans waiting for the money granted to them by the CARES Act. Speaking to Newsweek, Chad Hooper, national president of the Professional Managers Association (PMA) which represents managers at the Internal Revenue Service, says "should there be subsequent rounds of stimulus, the agency could get out all of the payments more rapidly."

He said: "Under the CARES Act program, the agency was able to issue direct deposits in fewer than four weeks – because of how the agency's aging mainframe functions, it is our understanding that the most rapidly a check could be issued is roughly 2-3 weeks so I would expect to see payments issued within 4 weeks.

"Because the Treasury recently chose to issue debit cards to unbanked taxpayers or taxpayers for whom we do not have banking information, this is another population of taxpayers for whom we would have direct deposit information and will only help the agency to issue subsequent payments more rapidly."

Will there be another stimulus check?

With this in mind, a second check was included in the HEROES Act, which was passed by the House of Representatives on 15 May. Those earning less than $75,000 a year would receive another payment of $1,200, with higher earners (up to $99,000 annually) getting a check for a lower amount.

While the first round of payments included an extra $500 per family for every child aged 16 or under, the HEROES Act would see this additional credit would rise to $1,200 each for a maximum of three dependents, allowing households to claim up to $6,000. It’s also worth noting that, unlike the CARES Act, dependents aged 17 or over are not excluded.

The $3tn package also proposes extending the Federal Pandemic Unemployment Compensation (FPUC) scheme, which gives those claiming jobless benefits an extra $600 a week, until January 2021. How successful the Democratic desire to have a clear focus on renewable energy within the package is, however, another question.