Coronavirus Stimulus check round 2 update: 4 possible plans

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Many Americans are looking for an update on the round 2 Coronavirus stimulus checks every day, but for now, the only updates available are comments from officials. All we can do right now is try to get an idea about what Congress might do for the phase 4 stimulus package, although negotiations won’t really begin until at least July 20.

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Update on round 2 Coronavirus stimulus checks

The main update on stimulus checks round 2 is the fact that President Donald Trump publicly said they will definitely be sending out more direct payments. Of course, he can't make any guarantee because it depends on what Congress does.

His statement is already influencing some Republicans who previously were hesitant on sending a second round of coronavirus stimulus checks. However, Congress and even the White House remain split on the issue of sending more stimulus payments.

Based on what White House officials have said, it sounds like a more targeted second round of stimulus checks could happen. Treasury Secretary Steven Mnuchin provided an update on the round 2 stimulus checks earlier this month when he said they were considering sending more payments.

However, National Economic Council Director Larry Kudlow later said they might target the second round of IRS stimulus checks at "people who lost their jobs and are most in need." That could be interpreted as those who are on unemployment and lower-income households.

The CARES Act sent $1,200 stimulus checks to individuals earning less than $75,000 per year and smaller amounts to those earning up to $99,000 per year, plus an extra $500 per child age 16 and younger. If there is a second round of coronavirus stimulus checks, the amount could be similar, although Trump has said the payments would be "generous."

Another update from last week indicates that Congress is also starting to come around as far as round 2 stimulus checks. Oklahoma Sen. Jim Inhofe, a Republican, said it will definitely happen, just not yet. He told reporters that last week's luncheon of Republican senators included two hours of discussion about the possibility.

Unemployment still up for debate

Beyond an update on stimulus check round 2, there are some other proposals that could put more money in your pocket if they end up in the phase 4 package. One provision that has been at the center of debate for weeks is unemployment.

The extra $600 in unemployment benefits expires at the end of July, but Democrats want to extend it. The problem is that the extra money means most people are earning more on unemployment than they did while they were working.

In fact, the Congressional Budget Office estimates that five of every six unemployment beneficiaries would receive more on unemployment than they would while on the job if the extra money were extended to January like Democrats want it to be.

As a result, Republicans don't want to extend the extra benefit because they don't want people to be incentivized to stay out of work for as long as possible. If people refuse to go back to work because they're making more on unemployment, it would be difficult for small businesses to get back up and running as the economy reopens.

A group of economists from both parties recently urged Congress to reduce the extra amount to $400, extend it past July, and tie it to each state's economic health.

Back-to-work bonus, payroll tax holiday also up for debate

A number of Republicans have also suggested providing back-to-work bonuses for those who return to their jobs after the pandemic. Congressman Kevin Brady suggested a $1,200 bonus, while Sen. Rob Portman suggested a $450 bonus per week for up to six weeks.

Several Republicans have also talked about the possibility of a payroll tax holiday, something else President Trump supports. The big issue with this is that Democrats probably won't support a payroll tax cut. If it doesn't get bipartisan support, it won't make it through both houses of Congress.

One thing Democrats want to see is aid for state and local governments. Republicans could support that provision if the money is tied specifically to coronavirus-related expenses. Many state and local governments are laying off workers because tax revenues plunged as businesses shut down.

State and local governments must balance their budgets, and the only way to do that during lean times is to lay off employees.