All your questions about a 2nd stimulus check, answered

  • Congress is still negotiating a second coronavirus relief package, and priorities for what should be included are largely split along party lines.
  • As it stands currently, it's unlikely that a second stimulus check is coming.
  • A first round of direct cash payments approved back in March helped Americans boost their savings accounts and pay off debt.
  • If you didn't get a stimulus check this year and should have, you'll be able to claim your payment on next year's tax return.
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Over 160 million Americans received stimulus checks this year as the country battled widespread coronavirus outbreaks and an economy in distress. 

Most people stashed the money in savings or used it to pay off debt, according to data from the Federal Reserve Bank of New York. Less than one-third of US households used the cash for essential and non-essential purchases. 

Congress has been negotiating more coronavirus legislation for months and appears to be getting closer to reaching a deal, but there's no promise of more stimulus checks.

Here are answers to some of the most common questions around stimulus checks: 

Will there be a second stimulus check?

Right now it looks unlikely. However, President-elect Joe Biden said Friday that he supports another round of stimulus checks and said "it may still be in play."

Business Insider's Joseph Zeballos-Roig reports that while there is bipartisan support for a $908 billion relief package — a sign that a compromise could be reached soon — the proposal doesn't include more stimulus checks.

Instead, the bulk of the funds would go toward unemployment benefits, aid for local and state governments, and loans for small businesses through the Paycheck Protection Program.

At the local level, Washington DC Mayor Muriel Bowser announced Monday that around 20,000 Washingtonians will be eligible for $1,200 stimulus checks. The cash payments will go to people collecting benefits from the Pandemic Unemployment Assistance program, including gig workers, independent contractors, people with a limited work history, and self-employed Americans.

Why is a second stimulus check unlikely?

In short: politics.

Congress has been negotiating another coronavirus relief package for months. The deadlock is largely due to different priorities among parties, with Democrats advocating for a larger bill that includes direct cash payments to households, and Republicans favoring a less expensive bill that includes education funding and aid to businesses.

Prominent economists have repeatedly urged Congress to authorize more stimulus checks. In an open letter signed by 125 economists in November, they called stimulus checks an "essential tool" for keeping millions of families out of poverty during the pandemic. 

Any relief package will need to pass both chambers of Congress and get a signature from the President before it becomes law. 

What is a stimulus check?

A stimulus check is a non-taxable, direct cash payment. The money can be used however you want and doesn't need to be repaid to the government.

The first round of stimulus checks were approved back in March. They were part of the $2 trillion CARES Act that also expanded unemployment benefits and provided loans to struggling businesses. 

A stimulus check is actually a tax credit that reduces your tax bill on a dollar-for-dollar basis. Some tax credits are refundable, meaning if you don't have a tax bill large enough to use the full credit, you will get the money as a refund.

The IRS, which distributed these payments to Americans through direct deposit and mailed checks, calls them Economic Impact Payments. The maximum payments were $1,200 for individuals and $2,400 for couples who file taxes jointly. There was also an additional $500 for dependents under age 17.

What if I didn't get the first stimulus check?

Over 160 million stimulus checks have been sent since April. If you didn't get one, there's a chance you don't qualify. You need to be a US citizen or resident alien, have a Social Security number, and not be claimed as a dependent of another taxpayer.

If you meet all those requirements and still didn't get a stimulus check, it's possible your income disqualified you. The IRS determined payment amounts using taxpayers' most recently filed tax return, either 2019 or 2018. Your adjusted gross income (AGI) needed to be less than $99,000 as a single filer, $136,500 as a head of household, or $198,000 as a married joint filer to receive a payment. 

If your income didn't meet those thresholds in 2018 or 2019, but it did in 2020, then you can claim your payment — formally called a Recovery Rebate Credit — on your 2020 tax return. Here's how it works. 

If you think your stimulus check was lost in the mail or stolen, here's what you can do.

What if I need financial help now?

There are a slate of government programs that can help with unemployment benefits, mortgage relief, student-loan forbearance, small business loans, food and other household expenses, and health insurance. Credit-card companies and banks are also offering financial assistance.

Here's a full list of where to go for help.

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