The situation involving a round 2 of IRS stimulus checks continues to evolve. It seemed like there was no chance for a second round of coronavirus stimulus checks, but that may be changing. Lawmakers may be moving closer to acting, especially if the Trump administration influences Republican lawmakers. Here’s the current status of a round 2 of IRS stimulus checks.
Status of round 2 of IRS stimulus checks
Right now there’s no clear package that has the approval of most lawmakers. The bickering and debate continues on Capitol Hill. The HEROES Act, which was passed by the Democrat-led House, appears essentially defunct. President Trump and Senate Republicans have called it “dead on arrival,” and that certainly appears to be the case.
Even if the HEROES Act never comes up for a vote, it doesn’t mean that round 2 of IRS stimulus checks won’t happen. McConnell has said that the next stimulus package will be written in the Senate and be the last such bill. Based on that comment, it sounds like the Senate will start from scratch on a new bill, which would mean that if both sides of the aisle can come to an agreement, it will then have to go to the House for a vote.
Possible timing of coronavirus stimulus checks round 2
The timing of a round 2 of IRS stimulus checks is up in the air. The White House is said to be working on another stimulus bill this week as President Trump was scheduled to meet with advisors to talk about it. However, Senate Majority Leader Mitch McConnell has said that people shouldn’t expect more stimulus until early next month.
That could mean that lawmakers will start debate on another package soon with the goal of passing it in early July. On the other hand, it could also mean that the Senate will wait to even start debate on another stimulus bill until next month.
Even if McConnell wants to wait for a month before starting debate, it’s possible the Trump administration could convince him and other Republicans who want to take a wait-and-see approach to move faster than they currently want to move. If the Trump administration has a proposal of its own, that could be enough to grease the wheels on a round 2 of IRS stimulus checks.
How the first round was spent matters
Whenever lawmakers get serious about a round 2 of stimulus checks, one thing that will inform the discussion could be studies on how the first round of money was spent. The Kellogg School of Management studied the first round of checks to see how they were spent.
Similar to other studies, Kellogg found that those with less than $500 in their bank account spent the first stimulus check on essentials. They also spent nearly half of the money within 10 days of receiving it. The bank account balance turned out to be a bigger factor than income level in how the money was spent.
People with more than $3,000 in their checking account didn’t change their spending behavior right after they received their check. The study also compared spending of this year’s stimulus checks with spending of the stimulus checks received in 2008. This time around, more money was spent on food and essentials, while in 2008, more of the money was spent on cars.