President Trump has finally signed the roughly $ 900 billion coronavirus aid package passed by Congress, albeit after nearly a week of delay and uncertainty about whether he would approve it.
Now that the Auxiliary Act is incorporated into the law, here are the most important things to know about it – including how it will help both individuals and small businesses.
1. Second stimulus payment
A second stimulus payment will be available, the details of which are as follows:
- A one-time stimulus payment of $ 600 for each person
- A one-time stimulus payment of $ 1,200 for married or joint applicants
- A one-time stimulus payment of $ 600 for all dependents under the age of 16
To qualify for the full second stimulus payment, you must have earned less than $ 75,000 (for individuals) or $ 150,000 (for married / joint applicants) in 2019.
If your Adjusted Gross Income is greater than these thresholds, the stimulus payment will be reduced by $ 5 for every $ 100 of Adjusted Gross Income above these thresholds. As a result, an individual tax advisor would not receive a stimulus payment if their adjusted gross income is $ 87,000 or more. For a married couple with no children, with an adjusted gross income of $ 174,000, their payment would expire in full.
You can find your “adjusted gross income” in line 8b of your federal IRS tax return 1040 for 2019.
When will you receive your stimulus payment?
Treasury Secretary Steven Mnuchin had previously said that the first electronic stimulus payments could be in bank accounts within a week. However, given the delay in signing the bill and the vacation break, it will be more like several weeks. The first people to receive payments are those whose bank details are on file with the IRS for direct deposit. So be sure to read how to deposit your second stimulus payment directly into your bank account. Otherwise, it will likely take several months for check payments to arrive.
2. New PPP loans and rules
The new law reopened the popular Paycheck Protection Program (PPP) by allocating an additional $ 285 billion to the program. Small businesses that have received an initial PPP loan may qualify for a second round of loans. More flexible rules have been added to ensure the issuance of the loans, including clear guidelines that the issuance of a PPP loan is not taxable.
However, the eligibility for a second PPP loan is stricter than before. A borrower must have fewer than 300 employees and generally have evidence of a 25% decrease in gross income in the first, second, or third quarters of 2020 from the year-ago quarter, with the new law capping PPP loans to $ 2 million. The law also provides $ 12 billion specifically for minority-owned companies.
Related: New Aid Package Offers Next Round PPP Financing For Small Businesses
3. Unemployment benefit
The new relief bill provides for an additional $ 300 per week for all workers receiving unemployment benefits through March 14, 2021 (and possibly longer). The act also expands the Pandemic Unemployment Assistance (PUA) program with expanded coverage for independent contractors, self-employed, and gig workers. The Pandemic Unemployment Compensation Program (PEUC) has also been expanded to provide additional weeks of government-funded unemployment benefits to people who are completing their regular government benefits.
In addition, the new law increases the maximum number of weeks that a person can claim regular state unemployment benefit plus the PEUC program or through the PUA program to 50 weeks.
4. Rental / eviction regulations
The new law provides for an extension of the eviction moratorium until January 31, 2021. In addition, $ 25 billion is available for rent relief to be used for future rent payments and incidental expenses, as well as rent back owed or incidental expenses.
5. Student Loans
The new law provides no relief or further indulgence in relation to student loans. There have been some press reports about the possibility that President-elect Biden will terminate part of the student loans at the beginning of his term by order of the executive branch
6. State and local funding
New state and local aid was not included in the final act. However, the law extends the deadline by which aid previously approved under the CARES law must be spent.
7. Liability coverage
There were many negotiations in Congress about the introduction of liability protection for companies as a result of the coronavirus. This was a hotly contested topic and didn’t end in the final act.
8. EIDL grants
The law added $ 20 billion for certain grants under the SBA’s Economic Disaster Injury Loan (EIDL) program. Eligible Corporations, Independent Contractors, Gig Workers, and Self-employed are eligible for grants of up to $ 10,000 (non-repayable) if (1) they are in a low-income community; (2) You suffered an economic loss of more than 30% in a period of eight weeks between March 2, 2020 and December 17, 2021, compared to a comparable period of eight weeks immediately before March 2, 2020 or in the year 2019. (3) they employ no more than 300 people; (4) You are a qualified company, e.g. B. a small business, private nonprofit, sole proprietorship, or independent contractor. and (5) they were operational through January 31, 2020.
9. Help for venues, theaters and cultural institutions
$ 15 billion has been allocated to live venues, independent cinemas, and cultural institutions.
10. Vaccination / health measures
The new law provides nearly $ 70 billion in public health interventions, including buying vaccines, distributing vaccines, and supporting government testing and tracing programs.
The full text of the law is 5,593 pages long and contains many other provisions, but the ones I’ve detailed here will have the greatest impact on the majority of Americans in the months ahead.
RELATED: 5 Ways The New Stimulus Bill Can Help Your Small Business
Copyright © Richard D. Harroch. All rights reserved.
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