How long it could take before a second stimulus check is in your hands

Personal finance

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Talk of a second round of $1,200 stimulus checks made headlines last week when Democrats in the House of Representatives passed a new bill including those payments.

But another round of federal relief checks is far from a done deal. Americans should brace themselves for a potentially long wait for that money, if it comes at all.

The Democrats’ bill, called the HEROES Act, calls for a second set of $1,200 payments for people in the same income thresholds as the first round of checks.

That would be $1,200 for individuals with up to $75,000 in adjusted gross income and $2,400 for couples who file jointly who earn up to $150,000. Those payments would be reduced for income above those levels, and ultimately phase out at $99,000 for individuals and $198,000 for couples.

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The proposal also would sweeten the deal for those with children, bringing those payments up from $500 to $1,200 per dependent, with a maximum of three dependents.

That means that under the new bill, families could get up to $6,000.

More dependents would also be eligible, because the age cap would be lifted to include those ages 17 and up. In addition, non-citizens would also qualify for the money. Those two groups would also qualify for retroactive payments for the first round of stimulus checks.

The White House has signaled that it would be open to another round of checks. However, any proposal would have to make it through the Senate before it made its way to President Donald Trump’s desk to sign.

Political gridlock

Senate Republican leadership has not embraced the Democratic House proposal with open arms.

On Thursday, Senate Majority Leader Mitch McConnell, R-Ky., said the next coronavirus bill will not extend enhanced unemployment benefits. Democrats wanted the $600 extra per week extended through January.

The idea of additional stimulus checks has also drawn criticism from other Senate Republicans, who are hesitant to sign off on any such checks until they’re sure they’re needed, with most states in the process of reopening for business. Meanwhile, others have said they are flat out opposed to a second round of payments.

“Republicans are hanging back,” said Chuck Marr, senior director of federal tax policy at the Center on Budget and Policy Priorities. “I think downward economic pressure will force action over time.”

Even with the glitches, they still did a very good job in terms of getting the money out with a short turnaround.

Janet Holtzblatt

senior fellow at the Urban-Brookings Tax Policy Center

It could take time before the Senate takes up another round of coronavirus stimulus legislation. The Senate won’t be in session this coming week. They also have another two-week break starting July 3.

“Political schedules tend to run around holidays,” Marr said. So that July 3 date will likely become the next deadline by when to get something done, he said.

Second deployment

If another round of stimulus checks gets a green light from Congress and Trump, the next question is how quickly that money could land in Americans’ bank accounts.

Admittedly, the administration is still deploying the first checks. While a majority of those payments have been sent, millions of checks are still on their way.

One congressional timeline estimated that it could take up to 20 weeks — or five months — for all of those checks to land. That’s due to the fact that the administration can only mail out a certain number of paper checks per week. Officials also do not have information readily available on file for everyone.

An estimated 13 million individuals could be left out because they are very low-income and don’t get government benefits such as Social Security or Supplemental Security Income, and are therefore not on the government’s radar, Marr said.

Lessons learned from the first round of checks could make the deployment quicker for some payments,  said Janet Holtzblatt, senior fellow at the Urban-Brookings Tax Policy Center.

For dependents under 17, for example, they would just need to increase the amount of the payments.

But it could be more of a challenge getting money to people who didn’t receive checks before, such as dependents ages 17 and up or undocumented workers.

“That’s going to present its own series of glitches, potentially,” Holtzblatt said.

One way they could deploy the second payments is to send the money out as they had the first time, and then require individuals to file tax returns in 2021 to get the remainder of what they are owed, she said.

That’s as the IRS faces other hurdles, including a delayed tax season, a backlog of mail that hasn’t been opened and preparations that need to begin for next tax-filing season.

“Even with the glitches, they still did a very good job in terms of getting the money out with a short turnaround,” Holtzblatt said.

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