Personal Finance

Second stimulus checks could be less than $1,200 per person. Here's what we know

Key Points
  • As Washington lawmakers continue to negotiate over what aid will be included in the next relief package, the possibility of second stimulus checks looks more likely.
  • Another round of payments could be around $600 to $700, down from the $1,200 sums Congress authorized with the first payments in the spring.
  • Lawmakers on both sides of the aisle, as well as President Donald Trump and President-elect Joe Biden, have said they support a second round of checks to individuals.
An employee holds a blank U.S. Treasury check before it's run through a printer at the U.S. Treasury printing facility in Philadelphia.
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It's looking more likely that direct payments to Americans will be included in the new coronavirus aid Congress aims to pass before lawmakers head home for the holidays.

Those stimulus checks could be around $600 to $700 per individual, Sen. John Thune, R-S.D., told reporters on Wednesday. That's just about half of the $1,200 payments authorized by the CARES Act in the spring.

A $600 reduced stimulus payment was included in a White House plan last week, though President Donald Trump has since called for sending bigger checks.

Now, Capitol Hill lawmakers are looking to move an approximately $900 billion legislative package toward the finish line.

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Here's why $1,200 stimulus checks were dropped from December's Covid relief package
Why $1,200 stimulus checks were dropped from December's Covid relief package

"There is a recognition that unless D.C. provides some more aid now, some of the economic impact to individuals and to families could be more permanent and some of the impact on small businesses would be absolutely permanent," said Ed Mills, Washington policy analyst at Raymond James.

Notably, a $908 billion package that was unveiled earlier this week did not include stimulus checks.

In order to add in those payments, but stay at a similar total price tag, the help that's included would have to be shifted.

If the stimulus checks are cut in half to about $600 per individual, their total cost would come down to roughly $150 billion from $300 billion.

Covid relief bill does not include state funding or liability protection
Covid relief bill does not include state funding or liability protection

Excluding state and local aid would save about $160 billion. Reports also suggest that lawmakers could reduce unemployment assistance in order to help pay for more direct payments.

Political leaders in Washington have argued for months over how to put together the next aid package. This time, there is more urgency that could lead to a deal, Mills said.

Long-term unemployed workers and small businesses are desperate for more aid, he said. Meanwhile, Covid-19 is surging and there's need for funding to distribute the vaccine.

"The CARES Act provided a bridge," Mills said. "The bridge has ended, but the pandemic has not.

"We need to complete the last leg of the bridge to get to a post vaccine world."

It remains to be seen whether there will be a push to increase the second stimulus checks to the $1,200 per individual that were sent out in the spring.

Sen. Bernie Sanders, I-Vt., has taken a firm stance on the need for more $1,200 payments. Last week, he introduced an amendment with Sen. Josh Hawley, R-Mo., with the hopes of making sure those payments are definitely included in upcoming legislation.

"Congress can't go home for the Christmas holidays until we pass legislation which provides a $1,200 direct payment to working class adults, $2,400 for couples and $500 for kids," Sanders tweeted on Tuesday.

Sanders said during a Wednesday interview with MSNBC that a $600 second stimulus check proposal could be good news for families but that he hoped to see more.

"I'm glad we're at some $600 per working class adult and $600 for the kids," Sanders said. "For a family of four, that would be $2,400, which I think will be pretty good news during this rather bleak Christmas period.

"But we have got to do more."