Recently, Congress passed an emergency stimulus package designed to deliver approximately $900 billion in COVID-19-related aid. On Sunday, Dec. 27, 2020, President Donald Trump signed the bill into law. The bill was part of a $1.4 trillion spending package that will keep the government open for the fiscal year.
Notably, the bill provides funding for unemployment benefits, small businesses, direct economic payments to individuals, vaccine distribution, and rental assistance. This article provides an overview of what is included in the emergency relief bill.
The New Bill Includes Aid For Businesses
The bill includes approximately $325 billion in funding to the Small Business Administration (SBA) to assist U.S. businesses that have been affected by the COVID-19 pandemic.
Specifically, the bill allocates $284 billion in funding to replenish the Paycheck Protection Program (PPP), which provides forgivable small business loans to eligible applicants. Under the bill, certain firms that had already applied for received and exhausted PPP funds will be eligible to apply for another PPP loan. To be eligible for a second PPP loan, a small business must have less than 300 employees and have sustained at least a 25% loss in revenue during any quarter of 2020 when compared to the same quarter in 2019. Additionally, small 501(c)(6) organizations with 150 or fewer employees that are not lobbying organizations would be eligible for a PPP loan with this round of funding.
The bill also provides the following with regard to the PPP:
- Expansion of expenses eligible for loan forgiveness to include supplier costs and investment costs related to modifying facilities and obtaining personal protective equipment for safety
- Simplified loan forgiveness process for businesses that have borrowed $150,000 or less in PPP loans
- Confirmation that business expenses paid for with PPP loan funds are tax deductible
Businesses interested in applying for a PPP loan should contact their lender for more information.
The bill also directs $15 billion in funding for independent live-venue operators affected by COVID-19 and another $20 billion for small business grants.
Direct Economic Impact Payments
The bill includes another round of economic impact payments—commonly referred to as stimulus checks. The CARES Act provided the first round of stimulus checks for eligible Americans. Under the CARES Act, tax filers with an adjusted gross income of up to $75,000 for individuals and up to $150,000 for married couples filing joint returns were eligible to receive the full payment of $1,200 per individual or $2,400 per married couple. Parents were also eligible to receive $500 for each qualifying child.
The bill follows the same eligibility guidelines as the CARES Act, but the amount of the stimulus check is less this time around. Instead of being eligible for a $1,200 payment, qualifying taxpayers are eligible for a payment of $600 per individual or $1,200 per married couple. Parents will also be eligible to receive $600 for each qualifying child.
OTHER PROVISIONS INCLUDED IN THE BILL
The bipartisan bill provides funding for a variety of other issues, including:
- S. Postal Service—$10 billion
- Health Care Provider Relief Fund—$35 billion
- COVID-19 Testing and Tracing and Vaccine Distribution—$69 billion
- Transportation Industry Relief (Airlines, Airports, Buses, Transit and Amtrak)—$45 billion
- Education—$82 billion
- Housing Assistance (Rental)—$25 billion
- Additionally, the bill extends the federal moratorium on evictions until the end of January 2021.
Another provision included in the bill is a ban on surprise medical bills—to help protect insured patients from large medical bills when they unknowingly receive out-of-network care. The bill also includes enhanced tax credits, including the employee retention tax credit for employers that keep employees on payroll and provide paid sick leave. Under the bill, the earned income tax credit and child tax credit would become available to those who lost wages or their jobs during the COVID-19 pandemic and expand the low-income housing tax credit.
Click here to view the full text and see what else is included within the bill.
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