Coronavirus

Stimulus check: what changes will there be between first and second payment?

The national unemployment rate is decreasing, many households still struggle financially due to the Covid-19 outbreak and they are in need of a second stimulus check.

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Stimulus check: what changes will there be between first and second payment?
SAUL LOEB AFP

On 27 March President Donald Trump signed the CARES Act, a $2.2 trillion economic rescue legislation that gave up to $1,200 per individual and $2,400 per household as well as an extra $500 for dependent children. Since then the IRS has sent over 160 million stimulus payments but as the economy reopens many Americans are in serious need of a second payment amid the outbreak.

Republicans, Democrats and the White House are trying to work together to come up with a bill that satisfies everyone in Congress and pass the fourth stimulus relief package that, among other measures, will provide for a second round of payments.

The Senate has been on recess since 4 July and will return back to work on the 20 July to start crafting legislation for the next stimulus bill. It seems like the second payment will come to millions of Americans struggling through the economy by the end of this month and President Trump has suggested that it will be significant.

Senate Majority Leader Mitch McConnell has suggested those earning less than $40,000 would qualify, which is lower than the $75,000 in the Democrats' proposed HEROES Act. Trump, however, wants a check larger than what the Democrats have put forward, which was a further $1,200. When the bill is passed the IRS should start sending the money in late August and early September.

Who would get this second payment?

Senator McConnell has already said that far fewer people would receive this second round of payment as lawmakers are targeting those with the highest financial need. This means, based on what he has pointed to, those people making $40,000 a year or less.

U.S. Senate Majority Leader Mitch McConnell.

U.S. Senate Majority Leader Mitch McConnell.

With the first stimulus check, the income thresholds were much higher to receive the full amount. Single filers could earn up to $75,000 and married couples could have a combined income of $150,000 and receive the full check amount. That’s unlikely to be the case with this second stimulus bill.

“I think the people who have been hit the hardest are people who make about $40,000 a year or less, many of them work in the hospitality industry,” McConnell said on 6 July. “The hospitality industry, as all of you know, just got rim-racked - hotels, restaurants - and so that could well be a part of it.”