As you are doubtlessly all aware our Government has, in record time, created and enacted a 2.2 Trillion Dollar Stimulus Bill. With so much of our 20 Trillion Dollar economy shut down now many economic pundits are predicting more may be needed in the coming months.
I will not pretend that I have read all of this bill. It is 880 pages long and I must confess to being more inclined to use some of my newly found house time re-organizing closets than reading legislation. But in case you have finished your chores and Netflix is not appealing then here you go. Some poor congressional clerks were obviously burning the midnight oil on this (with I am sure no help from lobbyists!) as this was all done in days. I will remember not to feel so sorry for myself again when I am lucky enough to have to put multiple contracts together late at night!
I have only addressed the major parts of this monumental bill and excluded the vast array of things that will apply to big business and the Healthcare sector, which you can read about in the link that follows. While I have not read the legislation I have looked at numerous summaries so you do not have to. NPR in particular has done a nice summary and I have used their analysis and breakdown extensively. So, if you have not already read up on what may be the most bi-partisan major legislation ever passed in the Senate (96-0) here is your primer so you can sound knowledgeable on social media while locked in.
Cash payments: Estimated to total $300 billion. Most individuals earning less than $75,000 can expect a one-time cash payment of $1,200. Married couples would each receive a check and families would get $500 per child. That means a family of four earning less than $150,000 can expect $3,400. The checks start to phase down after that and disappear completely for people making more than $99,000 and couples making more than $198,000.
Extra unemployment payments: The $260 billion estimated cost is subject to change based on the number of people filing for unemployment. The bill makes major changes to unemployment assistance, increasing the benefits and broadening who is eligible. States will still continue to pay unemployment to people who qualify. That amount varies state by state. So does the amount of time people are allowed to claim it. This bill adds $600 per week from the federal government on top of whatever base amount a worker receives from the state. That boosted payment will last for four months. In Illinois you can file using the IDEA website:
Gig workers and freelancers: Typically, self-employed people, freelancers and contractors can’t apply for unemployment. This bill creates a new, temporary Pandemic Unemployment Assistance program through the end of this year to help people who lose work as a direct result of the public health emergency.
Tax returns: Some people have not filed their 2019 tax returns, but that’s OK. The filing deadline has been extended to July 15. The IRS also says that people who have filed or plan to can still expect to receive a refund if they are owed one.
Student loans: Employers can provide up to $5,250 in tax-free student loan repayment benefits. That means an employer could contribute to loan payments and workers wouldn’t have to include that money as income.
Insurance coverage: The bill requires all private insurance plans to cover COVID-19 treatments and vaccine and makes all coronavirus tests free.
Small Business. A lot of you may fall into this category. If you think you might qualify for a loan you can read up on the Small Business Association Website. The main features for small businesses are emergency grants and a forgivable loan program for companies with 500 or fewer employees. There are also changes to rules for expenses and deductions meant to make it easier for companies to keep employees on the payroll and stay open in the near-term.
Emergency grants: The bill provides $10 billion for grants of up to $10,000 to provide emergency funds for small businesses to cover immediate operating costs.
Forgivable loans: There is $350 billion allocated for the Small Business Administration to provide loans of up to $10 million per business. Any portion of that loan used to maintain payroll, keep workers on the books or pay for rent, mortgage and existing debt could be forgiven, provided workers stay employed through the end of June.
Relief for existing loans: There is $17 billion to cover six months of payments for small businesses already using SBA loans.
Here are some additional links that you may find helpful:
- Taxpayer Relief – Illinois Department of Revenue
- Families First Coronavirus Response Act: Employee Paid Leave Rights – U.S. Department of Labor
- Coronavirus Emergency Loans: Small Business Guide and Checklist – U.S. Chamber of Commerce
- Here’s what the $2 trillion economic stimulus plan does for restaurants – Restaurant Hospitality
- COVID-19 and the Family and Medical Leave Act Questions and Answers – U.S. Department of Labor
- Protecting your finances during the Coronavirus Pandemic – Consumer Financial Protection Bureau
Please continue to be safe and take good care of yourself during these challenging times. I’m available to discuss any real estate related questions for you anytime.