Personal Finance

GOP propose a second round of $1,200 stimulus checks. Mnuchin wants to finalize legislation by July 31

Key Points
  • Republicans have unveiled their proposal for the next stimulus package.
  • A second round of $1,200 checks to Americans is included in that legislation.
  • While both sides of the aisle now are in agreement to send more checks, other issues, particularly expanded unemployment benefits, could hold up a final deal.
Senate Majority Leader Mitch McConnell (R-KY) (L) listens to U.S. President Donald Trump talks to reporters while hosting Republican congressional leaders and members of Trump's cabinet in the Oval Office at the White House July 20, 2020 in Washington, DC.
Doug Mills | Getty Images

It's the question that's been on everyone's minds: Will there be a second round of $1,200 stimulus checks?

The answer is likely yes, based on a proposal introduced on Monday by Senate Majority Leader Mitch McConnell, R-Ky.

The measure includes new $1,200 stimulus payments, with similar terms to the last set of checks.

Those first payments were for up to $1,200 per individual and $2,400 per couple, as well as $500 for each qualifying child under 17. This time, however, dependents over 17 would also qualify for the money.

The income thresholds to qualify would stay the same. Full payments were made to individuals with up to $75,000 in adjusted gross income, or $150,000 for married couples who filed their taxes jointly. Those with incomes above those levels received payments that were reduced, and were eliminated completely for those with income over $99,000 for individuals and $198,000 for couples.

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The stimulus checks have been a sticking point for Republicans, many of whom expressed reluctance to spend the money on another round of one-time payments. The first checks, authorized through the CARES Act in March, cost an estimated $300 billion.

Republicans began to embrace another set of checks in recent days, as they sought to fulfill President Donald Trump's wishes to get money into the hands of the American public fast. Payroll tax cuts were shelved in favor of the stimulus checks because they would arrive faster, Treasury Secretary Steven Mnuchin said in an interview with CNBC last week.

"The president's preference is to make sure that we send out direct payments quickly so that in August, people get more money," Mnuchin said.

How fast people receive the second batch of payments will depend on how quickly another legislative package can come together. Mnuchin has said he wants to finalize that legislation by July 31. 

Democrats are expected to embrace the stimulus checks, having included a second round in their own proposal, the HEROES Act, that was passed by the House in May.

But other issues, particularly how much expanded unemployment benefits to provide, could take longer for both sides to come to an agreement on.

Once the legislation is final, it could take weeks before Americans start to see the second payments in their bank accounts or mailboxes.

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Checks still outstanding

There was some pushback on Capitol Hill Monday regarding payments that are still outstanding from the first batch.

While the Treasury Department estimated the government would send 171 million stimulus checks in total, about 159 million payments had been sent as of early June. Since then, less than 1.5 million payments have been sent. 

The pace of delivery is "unacceptable," House Ways and Means Committee Chairman Richard Neal, D-Mass. and Senate Finance Committee Ranking Member Ron Wyden, D-Ore., said in a statement.

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The lawmakers called on the Treasury Department to make sure the remaining eligible Americans receive their money.

Neal and Wyden also called for improving the phone line the IRS has set up for stimulus check payment inquiries. Out of 15.4 million calls to the IRS to date, only 800,000, or 5%, of callers were able to reach IRS staff.

The Center on Budget and Policy Priorities has estimated that 12 million people could be at risk of not receiving their payments, even though they qualify. That includes people who don't usually file their taxes because their income is too low and who do not receive federal financial support, and are therefore not on the government's radar.

Who could get second payments promptly

This time around, some Americans may get their payments more quickly.

Those with their direct deposit information on file with the IRS will be first in line, like last time. But confusion around sending the payments to federal beneficiaries (those on Social Security, Supplemental Security Income or VA benefits) has been resolved, clearing the way for potentially quicker payments to those individuals, according to Garrett Watson, senior policy analyst at the Tax Foundation.

"Ideally, it should be almost as quick as the folks who are benefiting through direct deposit," Watson said. "But it depends on the timing of when they get their benefits."

Those whose 2019 tax returns have been processed should also get their payments quickly, Watson said. Those whose returns are not yet complete might see delays, Watson said.

The government may also improve its delivery through prepaid debit cards, which allows them to send more payments in addition to paper checks. 

At a recent Congressional hearing, Mnuchin vowed to improve the debit card delivery, including more clearly labeled envelopes. 

This is a breaking news story. Please check back for updates. 

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