Stimulus payment and unemployment: What's the difference?

With many struggling to meet their financial needs during the ongoing pandemic, several special financial assistance programs were been put into place by the government to help the affected and/or unemployed cope with either the added costs of living with the pandemic, or the inability to work because of it. Recently, there has been a lapse in these benefits as Congress debates the details of a new stimulus package, leaving many Americans in need.

You may also be in desperate need of these benefits, yet it can be hard among all the recent changes to keep up with the new programs, bills, acts, benefits and payments, what they stand for and where they come from. We’ll break down these elements so you can better navigate and understand this uncertain time.

What is a stimulus payment?

In the context of the Coronavirus pandemic, a stimulus payment is a one-time check, pre-paid card or direct deposit sent to an individual or family that is intended to relieve some of the financial burden the pandemic has caused. The last stimulus payment amount started at $1,200 for eligible single citizens, increasing for married couples and families with dependents.

Stimulus package vs. stimulus payment

A stimulus payment is just one feature of a stimulus package, which includes many elements of financial support and relief for certain Americans. To date, there has been one stimulus package (the CARES Act) passed through Congress and one round of stimulus payments issued as a result.

Does a new stimulus package = a new stimulus payment?

In addition to the stimulus payments already sent out, there is wide speculation and anticipation that the next stimulus package will include a similar stimulus payment. We won’t know for sure, however, if a stimulus payment is included until Congress passes the next stimulus package.

Until that time, a payment of this type isn’t likely to be disbursed. So if you’re waiting for a stimulus payment, it would be wise to track Congress’ progress as they debate the details of the next stimulus package.

Will I qualify for an upcoming stimulus payment?

While your eligibility for upcoming bill’s stimulus payment may differ from your eligibility for the CARES Act’s stimulus payment, eligibility for the CARES Act’s payment depends on your most recent tax filing information from either 2018 or 2019 tax payments (for those required to file).

In order to have payments disbursed to the Americans who may have the greatest need, qualified Americans were required to make under a certain amount of money per year to qualify, in addition to qualifications regarding citizenship, dependent status and more. Even if you’ve already received your CARES Act stimulus payment, it’s important to note that similar conditions will likely apply for any upcoming stimulus payment, so it’s something to be aware of if another round of payments is announced in the near future.

To see info on what specific requirements would qualify you under the CARES Act, click here and to check your payment status for the CARES Act stimulus payment, click here.

What’s Pandemic Unemployment Assistance?

Pandemic Unemployment Assistance is an additional benefit included in the most recent stimulus package (the CARES Act) that provides for the special circumstances that affect people who are unemployed due to the Coronavirus pandemic.

Why PUA was needed over regular unemployment insurance

Regular unemployment insurance is a weekly benefit that grants financial assistance to Americans who find themselves unexpectedly out of a job through no fault of their own. The expectation for regular unemployment insurance claimants is that, while receiving unemployment, they will be actively searching for gainful employment in order to transition out of this program as soon as possible.

Once the Coronavirus pandemic hit, many Americans did find themselves unexpectedly out of a job due to reasons beyond their control, however due to health risks and a lack of open businesses, many were unable to look for new work. To provide for people in this category, the CARES Act provided a $600 weekly unemployment benefit to those who lost their jobs because of the pandemic. This benefit does not require that you search for work while receiving unemployment benefits, like regular unemployment insurance.

PUA ends...will it come back?

Under the CARES Act, Pandemic Unemployment Assistance ended on July 25th, 2020. Not receiving those payments does not reduce the financial need of most Americans or their inability to find new work. As Congress debates the financial viability of a similar program in an upcoming stimulus package, Americans continue to go without financial assistance they desperately need to support themselves.

An unemployment benefit similar to PUA is set to be delivered with the new stimulus package, however it will likely pay out less than $600 per week for those who qualify.

Understanding what could be coming

While the benefits included in the CARES Act can offer some clues as to what may be available in the upcoming stimulus package, until Congress decides what the next stimulus package will look like, a stimulus payment and any additional unemployment payments will remain on hold.

In the meantime, understanding the dynamics of why these benefits were added to the last stimulus package helps you to better understand exactly what Congress is debating and exactly how the proposed stimulus changes will affect you in the end.

What benefits do you want to see in the next stimulus package?

Let us know in the comments below.