A Second Stimulus Package - What's in it for You
Senate Comes Back Next Week:
What You Need to Know About the Bill That's on The Table
On September 8th, the Senate returns from recess and will take up the matter of finalizing another economic stimulus package.
Steve Mnuchin and House Speaker Nancy Pelosi met by phone yesterday to try and find a compromise. President Trump is considering more executive orders to sidestep Congress if the bottle neck is not fixed.
This excerpt is from CNET. These are actions underway that are specifically important for you to understand:
1. The new eviction moratorium
What it is: On Sept. 1, the Trump administration under the CDC banner issued a nationwide order temporarily halting millions of US renters from being evicted, in hopes of reducing the spread of COVID-19. The order will cover all 43 million US residential renters so long as they meet certain requirements, and will last through Dec. 31, 2020.
How it could help you: To be eligible for the CDC's eviction moratorium, you must not expect to earn more than $99,000 this year (or $198,000 for joint filers). You're also eligible if you did not report income in 2019, or if you received a stimulus check earlier this year. You must also demonstrate that you've sought government assistance to pay rent, declare that you are unable to pay rent because of COVID-19 hardships, and affirm that you are likely to become homeless if you are evicted.
However, it's important to note that the order does not set aside any new federal funding for renters -- even if renters can't be evicted, they will eventually owe that rent, along with any late fees, penalties or interest. And in the meantime, landlords might struggle without that income from renters. Renters can also still be evicted for reasons other than not paying their rent.
2. A second stimulus payment to spur spending
What it is: A payment sent to qualifying individuals and families, based on annual income, age, number of dependents and other factors. The first stimulus payment authorized under the CARES Act has been sent to over 160 million Americans -- as a check, as a prepaid credit card or via direct deposit. But there have been problems, and after three months some are still waiting for their stimulus payment.
How it could help you: The payment isn't taxable and you can use it however you want -- to pay for food, housing, clothing and so on. The idea is that spending the checks will help the economy recover faster.
Why we think a second payment will pass: The CARES Act authorized payments of up to $1,200 per eligible adult and so does the $1 trillion HEALS Act. The House of Representatives' $3 trillion Heroes Act also called for $1,200 stimulus payments, but for more people. The White House supports another round of checks, which makes it likely that sending out payments will be part of the final bill.
3. Payroll Protection Program designed to help small businesses retain employees
What it is: Intended to help you retain your job, the Paycheck Protection Program provides forgivable loans to small businesses as an incentive to keep employees on the payroll.
How it could help you: The PPP is intended to encourage businesses to keep employing workers who would otherwise have lost their jobs during the pandemic.
Why we think it could get extended: The Republican proposal will target the hardest-hit small businesses, Sen. Susan Collins of Maine said during the rollout of the bill. That includes those with revenue losses of 50% or more over last year.
4. Employee retention tax credit could help companies cover worker pay
What it is: Under the program, an employer can receive refundable tax credits for wages paid to an employee during the pandemic. The employer can then use the credits to subtract from -- and even receive a refund for -- taxes they owe.
How it could help you: Again, it's not a direct payment to workers, but the program encourages businesses to keep workers on the payroll.
Why we think it could happen: The HEALS Act includes further tax relief for businesses that hire and rehire workers, and the Democratic-backed Heroes Act also builds on the tax credits that were part of the initial CARES Act. And there's additional bipartisan support besides.
5. What's happening with Trump's payroll tax cut?
What it is: The president has for months pushed the idea of including temporary payroll tax cuts in the next stimulus package. Another directive he signed earlier this month includes deferring certain taxes retroactively from Aug. 1, through December for people earning less than $100,000.
How it could help you: If you have a job, a payroll tax cut would let you keep more of your earnings from each paycheck for now. The plan would not help those who are unemployed and don't receive a paycheck. Workers and employers would still need to pay those taxes the following year.
Will it stick? Trump signed a memorandum Aug. 8 to enact the payroll tax cut, but it isn't clear if he has the legal right to do so. Typically, financial decisions like tax cuts are authorized by congressional vote, not a presidential order. We'll have to wait and see if legal action is brought against the order. Neither the proposed Heroes Act nor the Senate plan includes a payroll tax cut. US Industry trade groups say the tax cuts may be "unworkable."
Stay Safe,
Sara Eastwood-Richardson
