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Originally posted March 10th
Congress passed a massive $1.9 trillion COVID-19 relief bill with President Biden expected to sign it by the end of the week.
Here are the details:
Stimulus Checks:
The bill would send $1,400 stimulus checks to individuals making $75,000 or less and to couples earning $150,000 or less. Eligible taxpayers will also receive $1,400 for each dependent claimed on their federal tax return.
However, the phase out on this bill will be $80,000 for single filers or $160,000 for married filers.
Check our previous article here to see if its worthwhile for you to file your tax return early or to wait til after these checks are sent out.
Unemployment:
The weekly federal unemployment benefits will be $300 per week through September 6. That’s in addition to the state payment. The first $10,200 of income from unemployment will be exempt from Federal taxes for those making $150,000 or less.
Child Tax Credit:
The bill would expand the Child Tax Credit for the 2021 tax year to a fully refundable $3,600 for children 5 and younger and $3,000 for those ages 6 to 17.
The credit phases out for individuals with adjusted gross income of more than $75,000 and couples with more than $150,000.
Child and Dependent Care Tax Credit:
The tax credit for child and dependent care would increase for 2021 from a maximum of $1,050 for one child and $2,100 for two or more children to $4,000 and $8,000. The credit would also be fully refundable.
Food Stamps:
The bill will extend a 15% increase in food stamps benefits through September.
Rest of the bill:
This stimulus bill will also send $350 billion to state and local governments, set aside funds for contact tracing, vaccine distribution, education, rent and mortgage assistance, expand subsidies for health insurance, extend employee retention credit and provide nearly $30 billion in aid for restaurants.
Via Washington Post:
Unemployment benefits:
- The package extends the existing $300 weekly unemployment benefit through Sept. 6, as well as provides a tax break on $10,000 in unemployment benefits.
Stimulus checks:
- The bill would send $1,400 stimulus checks on top of the $600 payments issued through the stimulus bill passed in December. Roughly $400 billion of the package would go toward another round of checks.
- Biden agreed to narrow eligibility for a new round of $1,400 payments to appease more moderate Democrats. Under the new structure, the checks would phase out faster for those at higher income levels compared with the formula in Biden’s initial proposal and the House bill.
- Individuals earning $75,000 per year and couples earning $150,000 would still receive the full $1,400-per-person benefit. However, the benefit would disappear for individuals earning more than $80,000 annually and couples earning more than $160,000.
- For example, that means singles making between $80,000 and $100,000 and couples earning between $160,000 and $200,000 would be newly excluded from seeing any benefit under the revised structure.
Child tax credit:
- Under the legislation, most Americans would receive $3,000 a year for each child ages 6 to 17, and $3,600 for each child under age 6.
- The provision in the bill would last one year and be sent via direct deposit on a “periodic” basis. It is a major expansion of the existing child tax credit, which provides $2,000 a year for children from birth through age 16.
- The more regular payments are intended to help offset costs families face day-to-day, instead of sending families one annual payment.
Aid to state and local governments:
- The package designates $350 billion for states, cities, tribal governments and U.S. territories.
- Local government funding emerged as one of the top flashpoints in stimulus negotiations. Moderate Senate Democrats have pushed to redirect some of those funds to invest in infrastructure and to expand the broadband network. Others on the left have grown concerned that some states would use federal aid to cut local taxes instead of spending money on covid relief.
- Facing deep budget shortfalls, state and local governments have shed 1.3 million jobs since the pandemic began last year — a loss of more than 1 in 20 government jobs, according to a Washington Post. While tax revenue grew in some states last year, the majority — at least 26 states — were hit with declines.
Pandemic response
- Tens of billions of dollars will fund coronavirus testing and contact tracing; increasing the size of the public health workforce and funding vaccine distribution and supply chains.
- Biden said there will be enough coronavirus vaccine doses for “every adult in America” by the end of May — a two-month acceleration of his previous projection of July.
Housing assistance
- The bill sets aside more than $20 billion in emergency rental assistance and other relief for the homeless.
- Another $10 billion goes to mortgage and homeownership assistance.
School support
- The bill sets aside almost $130 billion to help K-12 schools reopen. That money would go to improving ventilation systems, reducing class sizes, buying personal protective equipment and implementing social distancing.
- Colleges and other higher-education institutions would receive almost $40 billion. That money could help support financial aid grants to prevent hunger, homelessness or other challenges for students during the pandemic.
- Additional funds would go to child care providers through the Child Care and Development Block Grant program. The bill also sets aside $1 billion for the Head Start program, which provides early-childhood education, health and nutrition services to low-income children and families.
New provisions
- The bill provides $510 million for the FEMA Emergency Food and Shelter Program. That money would support homeless services providers for overnight shelter, meals, one month’s rent and mortgage assistance and one month’s utility payments.
- It expands the Employee Retention Tax Credit for start-up companies and other businesses hit by the pandemic
- The bill also increases the value of the federal COBRA health insurance program from 85 percent to 100 percent
- The bill adds a $10 billion infrastructure program to help local governments continue crucial capital projects.
- The bill makes all coronavirus-related student loan relief tax-free.
- The bill increases the total amount of Amtrak relief funding by $200 million.
- For education funding, the bill sets aside $1.25 billion for summer enrichment; $1.25 billion for after-school programs and $3 billion for education technology
- The Senate bill also adds $8.5 billion in funds for the Provider Relief Program to assist rural health care providers.