Congress Just Passed Another Economic Aid Package, and It Includes Stimulus Checks—Here’s What It Means for You
More money could be on the way.
In March 2020, the U.S. government passed the CARES Act, a stimulus package meant to help people and businesses pay their bills and help preserve the economy. Nine months later, Congress has finally taken action on a second stimulus bill, which includes (among other provisions) a second round of stimulus checks.
After months (and months) of debate and negotiations, an administration-changing presidential election, and thousands of deaths and illnesses from COVID-19, the new aid package was passed by the Senate and the House of Representatives on December 21 just as frontline healthcare workers began receiving the long-awaited coronavirus vaccine and the FDA approved a second vaccine for emergency use. The bill outlining the parameters of the aid package must be signed by the president to go into effect. As of December 23, the president was calling for changes to the stimulus package—including larger stimulus checks—before he would agree to sign it. Whether congressional lawmakers agree to his changes remains to be seen, so the below features of the act may change before they are finalized.
At its core, this new relief act is intended to support people and businesses alike until the pandemic comes under control. This $900 billion economic relief package is certainly smaller than the $2 trillion CARES Act (though it was passed as part of a larger set of government funding legislation), but it still includes crucial aid and financial support to everyone struggling right now. Read on for more information on what you might be able to expect for the new stimulus checks and other aid.
This round of aid calls for $600 in direct payments per person. This includes children, so a family of four could receive $2,400 total. As with the CARES Act, anyone who earned less than $75,000 in 2019 (income amount is based on your 2019 tax return) is eligible for the full amount. Those who made between $75,000 and $99,000 will receive some reduced payment amount, and anyone who earned more than $99,000 is ineligible for any direct payment.
Per the CARES Act, adults making less than $75,000 per year received $1,200, plus an additional $500 for each dependent child. The new round of payments gives less per adult but more per child. Though the payments may be smaller, there are still plenty of smart uses for your stimulus check if you don’t need to use the funds for immediate needs.
In an interview with CNBC on December 21, Treasure Secretary Steven Mnuchin said people who qualify for stimulus checks could receive that money in just a few days. People who signed up for direct deposit for tax returns (or the previous round of stimulus checks) could very likely get their money before the end of the year, if the package is signed soon, while those who received paper checks last time may have to wait weeks or even months before their check arrives.
After the CARES Act passed in late March, the first round of stimulus checks began reaching people in April, though for some people, they took months to arrive. If the checks are distributed in the same way this time, people who have signed up for direct deposit will likely receive their checks first, followed by those who will be receiving paper checks.
As many as 10 million Americans weren’t required to file a tax return for last year. In April, these people had to register with the IRS to receive their checks. Hopefully, this time around, everyone eligible to receive a check will already be registered, so distribution goes much more quickly.
If you received a stimulus check earlier this year, you don’t need to do anything. You will receive your second check in the same manner you received the first, so all there is to do is sit back and wait. If you did not receive a check despite being eligible, though, or if your check amount was less than the full amount, you can claim a Recovery Rebate Credit on your 2020 taxes to increase the amount of your tax refund or lower the amount of taxes you may owe. Until your check arrives or you’re able to claim that credit, though, stay alert for potential stimulus check scams.
With this new round of aid, people receiving unemployment benefits would receive an additional $300 per week on top of what they receive from their state for 11 weeks, beginning at the end of December and ending March 14 (barring any further stimulus or aid legislation). If you have been receiving unemployment benefits but they already ran out, check with your state’s unemployment website to see what you need to do (if anything) to receive these 11 additional weeks of aid after the package is passed.
The CARES Act expanded unemployment benefits through July 31. Those benefits included an additional $600 per week for those receiving unemployment insurance and an additional 13 weeks of unemployment eligibility, but they did expire after July.
The new aid legislation would extend the national moratorium on renter evictions through January 31, 2021. The moratorium has certain restrictions—to be eligible, you must have experienced a substantial loss of income or layoff, among other conditions, and earn less than $99,000 ($198,000 for married couples filing jointly).
The student loan forbearance program, in which interest accrual and payments on federal loans were paused, had been extended to January 31, 2021, but this bill as it currently stands does nothing to extend that date. For now, unless there is another aid package or adjustments to this one before it’s signed, regular payments and interest accrual will resume on federal student loans beginning in February 2021.