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AMERICAN RESCUE ACT PLAN 2021 | CPE Webinars | myCPE

Senate Passes Biden’s $1.9 Trillion Covid Relief Bill

AMERICAN RESCUE ACT PLAN 2021 | CPE Webinars | myCPE
Imtiaz Munshi, CPA
  • Mar 08, 2021 07:00 PM EST
  • | 6295 Views

The $1.9 trillion coronavirus package passed by the Senate contains a wide range of proposals to help Americans still struggling with the economic fallout of the pandemic.

The Senate approved the plan in a 50-49 party line vote as Republicans questioned the need for another broad spending package. The legislation includes direct payments of up to $1,400 to most Americans, a $300 weekly boost to jobless benefits into September and an expansion of the child tax credit for one year. It also puts new funding into Covid-19 vaccine distribution and testing, rental assistance for struggling households and K-12 schools for reopening costs.

The package also includes $14 billion in payroll support for U.S. airlines, the third round of federal aid for the industry, in exchange for not furloughing or cutting workers’ pay rates through Sept. 30. Airline contractors were set aside $1 billion.

Highlights of the AMERICAN RESCUE PLAN ACT 2021

  • If your family makes less than $160,000 a year: The Senate bill would provide direct payments worth up to $1,400 per person to families earning less than $160,000 a year and individuals earning less than $80,000 a year. The payments will phase out faster than they would have under the House version of the bill, which set the income caps at $200,000 for couples and $100,000 for individuals. That means that not everyone who was eligible for a check earlier will receive one now — but for those who do qualify, the new payments will top up the $600 checks approved in December, bringing recipients to a total of $2,000 apiece.
  • If you are unemployed: The jobless would receive a $300 weekly federal boost to unemployment benefits and would get those payments through September, under a last-minute change in the Senate. The deal also calls for extending two key pandemic jobless benefits programs for the same period and making the first $10,200 of unemployment payments tax-free.
  • If you are hungry:

    Under both the Senate and House bills, food stamp recipients would see a 15% increase in benefits continue through September, instead of having it expire at the end of June. And families whose children's schools are closed may be able to receive Pandemic-EBT benefits through the summer if their state opts to continue it.

  • If you're behind on your rent or mortgage: Both bills would send roughly $20 billion to state and local governments to help low-income households cover k rent, rent assistance and utility bills.
  • If you have children: Most families with minor children could claim a larger child tax credit for 2021, under a provision contained in both the Senate and House bills. Qualifying families could receive a child tax credit of $3,600 for each child under 6 and $3,000 for each one under age 18, up from the current credit of up to $2,000 per child under age 17.
  • If you own a small business: The bills would provide $15 billion to the Emergency Injury Disaster Loan program, which provides long-term, low-interest loans from the Small Business Administration. Severely impacted small businesses with fewer than 10 workers will be given priority for some of the money.
  • If you're sick: If you're sick, quarantining or caring for an ill loved one or a child whose school is closed, the bills may provide your employer an incentive to offer paid sick and family leave. Unlike Biden's original proposal, the House and Senate bills would not require employers to offer the benefit. But they do continue to provide tax credits to employers who voluntarily choose to offer the benefit through October 1.
  • If you need health insurance: More Americans could qualify for heftier federal premium subsidies for Affordable Care Act policies for two years, under both the Senate and House versions of the plan.

“This isn’t a pandemic rescue package. It’s a parade of left-wing pet projects that they are ramming through during a pandemic,” Senate Minority Leader Mitch McConnell, R-Ky., said on Friday.House Speaker Nancy Pelosi, D-Calif., held out hope for GOP support in a statement following the Senate’s passage of the plan.“The House now hopes to have a bipartisan vote on this life-saving legislation and urges Republicans to join us in recognition of the devastating reality of this vicious virus and economic crisis and of the need for decisive action,” she said.After he signs the rescue plan into law, Biden is expected to move toward his economic recovery and infrastructure proposal. Still, Schumer did not rule out another pandemic relief bill if economic conditions show areas of need. “If they need more help, we’ll do another bill,” he told reporters.

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AMERICAN RESCUE ACT PLAN 2021 | CPE Webinars | myCPE

Imtiaz Munshi, CPA

CFO, AZSTEC LLC

The author Imtiaz Munshi is a Certified Public Accountant and CFO at Azstec, LLC. He is Business Strategist, Tax Planner, Entrepreneur and Advisor to "HNEs" (High Net Worth Entrepreneurs).