What did Congress just pass?
The US House of Representatives passed a $1.9 trillion Covid relief bill on Wednesday. The measure, dubbed the “American Rescue Plan,” has been President Joe Biden’s top priority since he took office seven weeks ago. It was passed by Democratic majorities in the Senate and House, with Republicans voting “no.”
Opponents said the measure is too expensive, will add to the federal deficit and could discourage people from working. Proponents said the historic COVID-19 pandemic and the economic struggles, especially of middle and low-income households who have lost jobs, are demanding major help from the federal government.
Biden signed the bill on Thursday.
I heard everyone gets $1,400. Is that true?
New. It depends on how much you earn. The bill provides an immediate payment of $1,400 for a single taxpayer, or $2,800 for a married couple applying together, and an additional $1,400 per dependent. So a family of four could receive $5,600. But not everyone gets the money. Couples with adjusted gross income up to $150,000 per year are eligible for the full amount, and individuals with adjusted gross income up to $75,000 per year are eligible for the full amount.
The size of the payments is reduced for individuals earning between $75,000 and $80,000. And there are no payments for individuals making more than $80,000 a year. Likewise, there are partial payments for couples earning between $150,000 and $160,000, with no cash for couples earning more than $160,000 or their dependents.
Your adjusted gross income will be based on your 2019 tax form unless you have filed a 2020 tax form, which is the most recent.
How do I get the money?
To qualify for the payment, you must be a US resident with a Social Security number. The IRS is expected to deposit the checks in people’s accounts by the end of this month. If you haven’t set up a direct deposit with the IRS for filing your taxes, the IRS will send you a check. You don’t have to apply or queue to receive the money.
I remember hearing we were going to get $2,000.
The $1,400 comes on top of the $600 approved by a bill signed by former President Trump in December and passed by large bipartisan majorities. Biden and Democratic leaders have said that’s what they meant by $2,000.
Is there a calculator somewhere that can help me calculate this?
Yes. Omni Calculator has posted one on its website. The address is www.omnicalculator.com/finance/american-rescue-plan#who-is-eligible-for-the-stimulus-where-do-you-sign-up.
I have been fired. What about unemployment? I heard there was money in the account for that too.
Yes, in addition to the unemployment benefits people already receive through their state unemployment programs, this law will continue to expand unemployment benefits by $300 a week through September 6.
What else is in it that could help me?
The bill provides $30 billion to help low-income and unemployed households pay their rent and utility bills, and $10 billion for homeowners struggling to pay their mortgage due to the pandemic.
There are also extensive tax credits for those with children — $3,600 in 2021 for children under age 5 and up to $3,000 for children ages 6 to 17 — which economists say should reduce child poverty in the United States.
I heard there’s a lot of pork on the bill.
It depends on how you define pork. The bill includes $46 billion to expand COVID-19 testing, along with $14 billion to expand vaccine programs nationwide. And there is $129 billion to help schools hire more nurses, buy masks and protective gear, improve ventilation systems and take other steps toward reopening.
The bill also has $28 billion for bars and restaurants that suffered major financial blows during the pandemic, and $350 billion to help cities, counties and states balance their budgets to avoid layoffs from police, firefighters, public works and others. workers after tax revenues have fallen sharply in many areas due to the pandemic.
Will it raise the minimum wage?
New. The House approved raising the minimum wage nationally to $15, but that provision, pushed by Senator Bernie Sanders, D-Vermont, failed in the Senate. A separate bill to raise the minimum wage by a lower amount, perhaps to $11 or $12 nationally, is expected later this year. The California minimum wage is already $12 an hour and must rise to $15 by 2023 under state law.
How do Americans view the bill?
A CNN poll released Wednesday found the measure has the support of a majority of Americans, 61% to 37%. Another poll from the Pew Research Center on Tuesday found an even wide margin, 70% to 28%.
Does California also not have a state program to provide COVID relief payments?
Yes. It’s a separate program called the “Golden State Stimulus.” Rolled out a few months ago by Governor Gavin Newsom and approved by state lawmakers last month, the plan offers $600 per person. But it’s much more geared toward very low-income people than the new federal program.
The Golden State Stimulus offers $600 to California residents who qualify for the state Earned Income Tax Credit on their 2020 tax returns. Generally, California tax returns earning less than $30,000 per year are eligible for that credit. They will receive the $600 “shortly after” they file their state taxes this year, Newsom said.
The $600 is also available to California households enrolled in CalWORKS, a state welfare program for low-income families with children under 18 whose parents are unemployed, deceased, or disabled. The $600 grant payments for CalWORKS households are expected in mid-April.
And it is available to recipients of SSI/SSP and the state’s Cash Assistance Program for Immigrants (CAPI). The first stands for Supplemental Social Security Income/State Supplementary Payment, a federal program designed to help elderly, blind and disabled people with little or no income. It provides money for food, clothing and shelter. But since 1996, it has mostly been restricted to US citizens. CAPI is a state program that offers similar benefits to California residents who are not US citizens.
Finally, undocumented immigrants living in households earning less than $75,000 per year are also eligible for the state program. Many of the communities hardest hit by the pandemic are low-income Latino communities, where farm workers and others have fallen ill or died.
Until this year, the state Earned Income Tax was only eligible for people with a BSN. That excludes undocumented immigrants. Under the California program, state taxpayers who use individual tax identification numbers — a tax processing number available to residents, their spouses, and dependents who cannot get a Social Security number — are eligible for the $600 payments if their household income is less than $75,000.