Where We Stand on a Stimulus Bill

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Where We Stand on a Stimulus Bill

Posted by Infinite Wealth Advisors, LLC
3 weeks ago | October 8, 2020

Toward the end of September, reports began to circulate indicating that Congress might finally reach an agreement on a second stimulus bill. But with Republicans and Democrats still not in full agreement, here’s what you need to know about the chances of the bill passing soon.

What’s the problem? The good news is that both parties agree a second stimulus bill is needed. Unfortunately, each side has their own idea of the final price tag, and they’re still about $1 trillion apart. That’s a pretty big deal, but they were previously more than $2 trillion apart on the price tag, so we’ve definitely seen some positive movement toward a compromise.

Democrats have proposed a bill worth $2.2 trillion, whereas Republicans prefer to spend about $1 trillion less. Why the discrepancy? The GOP worries that continued high unemployment checks might hamper an economic rebound, by making lower wage earners less enthusiastic about returning to work.

What would the potential stimulus look like? Currently, Republicans favor stimulus checks in the amount of $1,200 for singles, and $2,400 for married couples, plus $500 dollars for each dependent. Unlike the last stimulus payment, this round of checks would include teens over 16 and adult dependents.

Democrats, on the other hand, prefer checks of $1,200 per family member, limited to three dependents.

Who gets the stimulus? Both parties agree that stimulus efforts should focus on lower- and middle-income Americans, based on annual income. Payments would begin to phase out at $75,000 and go up to $99,000 for single taxpayers, and at $150,000 to $198,000 for married couples. Anyone earning under those amounts would receive the full stimulus.

When could checks arrive? Now that the system is set up to deliver stimulus checks, experts estimate that the payments could begin arriving about one week after a bill is signed by the President. Of course, like last time, distribution of the checks will last for several weeks before everyone has received their payment.

Although the parties are closer than ever to an agreement, discussions do remain contentious. The best action at this time is to hope for another stimulus, but don’t count on it yet. In the meantime, if you have any other questions about financial planning, give us a call and we’ll be happy to help.

 

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