The waiting may be the hardest part for people who need cash to put food on the table, even if the $600 stimulus checks in Round 2 are half of the $1,200 that most adults received in April.
The new $600 stimulus checks may arrive in the bank accounts of millions of Americans as soon as today after Trump signed a $900 billion economic relief package Sunday night. Trump called for the $600 stimulus checks to be raised to $2,000 per person.
The U.S. House of Representatives voted on Dec. 28, to pass a bill to increase the $600 stimulus checks to $2,000. Senate Majority Leader Mitch McConnell blocked an attempt to vote on the House-approved $2,000 stimulus. Instead, he resurrected another bill that includes the higher payments along with things on Donald Trump’s wish list such as repealing Section 230, which shields social media companies from lawsuits.
Treasury Secretary Steve Mnuchin tweeted on Dec. 29 that stimulus checks could start arriving in bank accounts “as early as tonight.”
Some Twitter respondents were skeptical. “What about tax refunds I still waiting from February,” one tweeted.
The first round of payments are expected to increase the country’s real (inflation-adjusted) economic output by 0.6 percent in 2020 according to Congressional Budget Office. That’s about half of the economic boost provided by enhanced unemployment benefits and 33 percent less than the boost from the Paycheck Protection Program and related small business provisions. The payments are expected to boost the economy by 60 cents for every dollar of budgetary cost, the Peter G. Peterson Foundation reported.
Forty percent of households in a study from TransUnion said they were banking on the promise of another stimulus check to help pay bills. Almost 60 percent said they have had a financial setback due to the pandemic as of the end of November, CBS News reported.
Wall Street analysts predict that $600 checks, not $2000 checks, are most likely all that people will receive.
“In our view, the $2k cash supplement is unlikely to pass the Republican Senate given the strained fiscal conservatism in the (Republican) caucus,” Benjamin Salisbury and Hunter Hammond of Heights Securities said in a Dec. 29 research note. “We still expect eligible recipients to receive $600, not $2,000.”
The CARES Act sent out 160 million economic impact payments starting in early April, and the savings rate soared. A study looked at spending and saving habits of households that got their money by April 21, and found they generally spent between a quarter and a third of the check in the first 10 days.
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Round 2 of checks has been a long time coming. Cash-strapped households drained checking and savings accounts, leaving them little choice but to spend the incoming money. As news of the $600 checks spread, some on social media said it would do little to help them, MarketWatch reported.
Dependent children under age 17 will receive the same $600 checks as adults, up from the $500 checks that children received through the CARES Act in the spring. Adults who are claimed as dependents, such as college students, won’t qualify for the checks. Single people earning up to $75,000 will receive $600, while married couples earning up to $150,000 will receive $1,200. A family of two parents and two dependent children could receive up to $2,400.
Couples that include an immigrant without a Green Card will also qualify for the checks. Denying checks to U.S. citizens due to their spousal or parental relationship to an immigrant prompted lawsuits earlier this year. Plaintiffs claimed such action was unconstitutional.
To see how much you might receive, go to Omni Calculator’s second stimulus calculator for an estimate.