When COVID-19 took the U.S. by storm, it quickly became clear that relief would be needed to help the millions of Americans who were impacted negatively by the pandemic almost immediately. Thankfully, the CARES Act was signed into law in late March, and it allowed for, among other provisions, a $1,200 stimulus payment for eligible adults, plus an additional $500 per dependent. Most of those payments went out in April and May, and they helped countless Americans cover essential bills during a very difficult time.
But the COVID-19 situation has not changed for the better since spring. If anything, the outbreak seems to have gotten worse, which means hopes of busting out of our current recession are rapidly being dashed.
Recognizing the need for additional relief, lawmakers have been putting their heads together to come up with a second stimulus package, and this week, Republicans revealed the HEALS Act. Short for Health, Economic, Assistance, Liability Protection, and Schools, the HEALS Act includes a second round of direct stimulus payments that many Americans are desperate for. And while it mostly mimics the first round that went out, there's one key distinction.
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More people are in line for money this time around
The CARES Act paid $1,200 to single tax filers whose income was $75,000 or less, and $2,400 to couples with a joint income of $150,000 or less. It also paid $500 for dependents under the age of 17. But dependents aged 17 and older were not included in the first round of stimulus payments, leaving an estimated 26 million individuals out in the cold.
The HEALS Act seeks to change that, and under its proposal, any dependent listed on a tax return is eligible for a $500 payment. This includes college students who were left out of the first round. Furthermore, there's no cap on the number of dependents a family can claim. A couple with six children listed as dependents, for example, can get $3,000 for them, plus another $2,400 for themselves, for a total of $5,400 under the new proposal.
Of course, some people may not be happy with an extra $500 per dependent given that the Democratic-proposed HEROES Act, which was released in May and has since stalled in the Senate, called for $1,200 per dependent, not $500. But the HEROES Act also capped recipients to a maximum of three dependents per household, whereas the HEALS Act is not seeking to limit the number of dependents a single household can claim.
If the HEALS Act is passed quickly, those in line for a second direct stimulus payment could potentially see that money sometime in August. The IRS already has a system in place from the first round of payments to facilitate a smooth transfer of funds, and those who are able to receive a second stimulus via direct deposit could see that cash just weeks after the HEALS Act gets signed into law. That's good news for the millions of Americans who continue to struggle as the COVID-19 pandemic shows no signs of slowing down.
