We're not even a full seven months through 2020 yet, and I can confidently say that this year will go down as the most challenging on record for Americans, at least in the modern era.

The coronavirus disease 2019 (COVID-19) pandemic has wreaked havoc on the U.S. physically and financially. Nearly 145,000 Americans had lost their lives, as of July 24, with the U.S. unemployment rate surging to levels not consistently seen since the 1930s.

While efforts to combat the coronavirus pandemic's physical toll continues in research labs around the country, lawmakers believed that tossing an extraordinary amount of cash at the problem early on would be the best solution to the United States' financial woes. Thus was born the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

A messy pile of cash and a partially covered U.S. Treasury check next to the Capitol building.

Image source: Getty Images.

The CARES Act was a godsend for businesses, but did little to help the average American

The CARES Act clocked in at a full cost of $2.2 trillion, meaning it was nearly triple the value of the relief package passed by the Obama administration during the financial crisis to support banks and reignite economic growth. The CARES Act provided funds for small businesses and distressed industries, allocated relief money to hospitals to combat COVID-19, and expanded the unemployment benefits program. This expansion involves tens of millions of unemployed beneficiaries receiving an extra $600 a week from April 1, 2020 through July 31, 2020 (or until they get a job).

But the standout aspect of the CARES Act was the $300 billion set aside for direct stimulus payments to workers and senior citizens. These Economic Impact Payments (as they're officially known) could total as much as $1,200 for individuals or $2,400 for couples filing jointly. Additionally, dependents under the age of 17 could add $500 each to what a parent or household received. To net this max payout, a single, head-of-household, or married tax filer simply needed an adjusted gross income below $75,000, $112,500, or $150,000, respectively.

Although the CARES Act sounded great on paper and did have a notable impact on the business side of the equation, it wasn't a great help to the average American. Approximately three-quarters of all stimulus recipients burned through their payouts in four weeks or less. Considering the slow pace of the economy recovery and the resurgence of COVID-19 infections throughout some parts of the U.S., it would certainly appear that another round of stimulus is very much needed.

A judge's gavel lying atop a messy pile of one hundred dollar bills.

Image source: Getty Images.

Stimulus round two: Here's what we know, so far

After months of debate, the next round of stimulus discussions is beginning to heat up. Despite the Democrat-led House of Representatives passing the $3 trillion HEROES Act on May 15, Senate Majority Leader Mitch McConnell (R-Ky.) has been adamant that the next stimulus proposal would originate with the Senate. That official proposal is expected to be unveiled sometime this week.

While there are numerous details left to be ironed out in the GOP-led stimulus proposal, there are seven things we know, so far.

1. An approximate price tag of $1 trillion

First of all, we know that McConnell and his colleague are trying to keep the overall cost of this next stimulus proposal to around $1 trillion. That's roughly $2 trillion less than what Democrats were seeking when they passed the HEROES Act. It's no secret that the federal deficit this year is huge due to the pandemic, and Senate Republicans are going to do whatever they can to stop from ballooning it any more than they need to with this next round of stimulus.

2. Roughly $25 billion in funding for vaccine research/distribution, with a catch

Stimulus round two is going to contain about $25 billion that'll be used for additional COVID-19 vaccine research, and potentially the distribution of successful vaccine candidates. However, it should be noted that only $16 billion of this $25 billion represents new funding. Some $9 billion had previously been appropriated for vaccine research and distribution.

President Trump had previously opposed any additional federal funding for vaccine research, but appears to have now softened his stance. 

A young student interacting with her teacher.

Image source: Getty Images.

3. $105 billion to aid in the reopening of schools and universities

President Trump and Senate Republicans have made the reopening of schools a key point of the next stimulus package. As part of the preliminary agreement between Senate Republicans and the White House, $70 billion will be apportioned to kindergarten through 12th-grade education on a per-capita basis, with a larger share of funds going to schools that have reopened.

An additional $30 billion will be allocated to colleges and universities -- this $30 billion won't be parsed out based on whether or not colleges have reopened, unlike K-12 schools -- with the final $5 billion going to state governors, who'll be able to allocate these funds however they choose.

4. Another direct stimulus payment to Americans

Yes, the American public and senior citizens should be counting on another direct stimulus payment. Thus far, nothing has been said from the Senate or White House on how large the next payouts will be, or if the qualifying income thresholds will have changed from the CARES Act. All we know is that another round of direct payments is coming.

For what it's worth, President Trump opined recently that he wanted to give Americans more than what Democrats were offering, but this remains to be seen, especially with McConnell and Senate Republicans angling to keep the total package cost around $1 trillion.

A smiling young associate using a touchscreen computer in a retail store.

Image source: Getty Images.

5. A second round of PPP loans

The next stimulus package looks as if it'll include yet another round of payroll protection program (PPP) loans for small businesses. The PPP allowed businesses to receive a forgivable loan that was equal to 2.5 times their monthly payroll costs. The catches being that at least 60% of expensing had to be on payroll, and businesses could have no more than 500 employees.

There's little question that small businesses have taken it on the chin due to COVID-19, and it now looks like the GOP has every intention of including PPP loans in the upcoming proposal

6. Enhanced unemployment benefits targeting 70% wage replacement

In just a few days, enhanced unemployment benefits, which provide the noted $600 a week extra, will officially sunset.

Democrats called for an extension of this added benefit through January 2021 in the HEROES Act. However, the GOP-led stimulus proposal in the Senate will call for a considerably stingier enhancement going forward. That's because Republicans view the $600 a week enhancement as a disincentive to get back to work.

According to Treasury Secretary Steven Mnuchin, the next proposal will aim to replace 70% of a worker's wages. This would result in the typical unemployed beneficiary netting between $188 and $310 extra each week, down from $600. Ultimately, an estimated 32 million unemployed beneficiaries would see a drop in their take-home if the targeted 70% wage replacement becomes law. 

Two Social Security cards lying atop a W2 tax form.

Image source: Getty Images.

7. No payroll tax holiday

Finally, don't expect President Trump to get his wish on a payroll tax holiday in the next stimulus proposal.

For months, Trump has pushed for a payroll tax holiday, which would partially reduce or eliminate the payroll taxes that most working Americans pay. The goal of a payroll tax cut being to increase the take-home paychecks of workers.

Unfortunately, Trump's plan ran into a trio of problems. First, it would help working Americans but fail to provide financial assistance to the unemployed. Secondly, it would remove the top source of income (the payroll tax) for Social Security, putting America's top social program on even shakier ground. And third, Trump's payroll tax proposal had little support from Democrats or Republicans.

Based on the current rate of progress, don't expect any firm agreement between Democrats and Republicans prior to the first week of August.