The new administration has announced plans for the American Rescue Plan, a $1.9 trillion stimulus package to help offset the impacts of the COVID-19 pandemic.
This is the third Covid-19 related rescue package augmenting those passed in March and December of 2020.
In a Nutshell:
- Summer 2020 $1,200 check
- Dec 2020 $600 Check
- Biden Proposal (not passed yet) $1,400 check
Checks 2 and 3 to make $2,000 total as proposed by Biden.
Like previous packages, there are income limits to qualify for the direct stimulus checks. For single taxpayers, those with total income less than $75,000 will receive full payment, while for married taxpayers filing jointly if total income is less than $150,000 they will each receive full payment. Details have still to be finalized whether those with total incomes above these limits will receive a partial payment as was the case for the first 2 rounds of stimulus checks.
- Increase the federal unemployment booster to $400 a week and extend it through the end of September. This is aimed at helping those who have lost or suspended their jobs because of the COVID-19 pandemic.
- For those who are still working, Biden is also proposing the COVID-19 relief bill to permanently raise the minimum wage to $15 per hour.
- Under the expanded Child Tax Credit, families with children up to age 13 could receive a total of up to $4,000 for one child or $8,000 for two or more children. Families making less than $125,000 per year would receive the full credit, while those earning up to $400,000 would receive a partial credit. Importantly, the CTC would be fully refundable if it cannot be used to off-set the taxpayer’s 2021 federal tax liability and represents a significant expansion of the credit.
- This bill isn’t focused on small businesses the way the past two have been, possibly because there is still Paycheck Protection Plan stimulus money available to small businesses from the last package.
- The vaccine program would look to increase the vaccine supply and would provide funding to hire a workforce to distribute the vaccine. The money for testing will be used to purchase rapid tests and to expand the capacity of labs to process the results.
- Extending eviction and foreclosure moratoriums through the end of September 2021
- State and local government aid totaling $350 billion
- Education funding (K-12 and higher education) of $170 billion
- $50 billion for COVID-19 testing
- A national vaccine program ($20 billion)
If you want help making sure you are able to protect your finances during the pandemic and beyond, a BakerAvenue Wealth Advisor can help you through these transitions.
Source: SmartAsset: Biden’s Proposed New Stimulus Plan