(Update 12/27/20: The bill has now been passed after being signed into law by the president.)
(Reposting 12/23/20: I’ve updated various parts of this post over the past days. Also added a link to a calculator to calculate your check. Deposits could be seen in a matter of days.)
The US Senate and House have agreed to a bipartisan $900 billion stimulus deal which is expected to become law. The bill sends $600 deposits to most US residents, supplements state Unemployment benefit by adding $300/week, adds new funding to the PPP loan program, and more.
This new stimulus bill follows the major $2 trillion stimulus sent out earlier this year which with $1,200 checks to most US residents, $600/week in unemployment, PPP loans and more.
$600 Checks
The highlight is again the $600 deposits/checks which will be sent out to most US residents. Parents will also get $600 per child, so a family of 4 would end up with a $2,400 check. The $600 figure is half of the $1,200 sent out in the first stimulus, though the child benefit is slightly higher at $600 versus $500 in the first round.
- Those who earn less than $75,000 get the full $600. For a couple filing jointly it’s $150,000 and for a head-of-household it’s $112,500.
- Those who earn more than $99,000 per year ($198,000 for a couple) who will not get anything. “Income” is defined as AGI, adjusted gross income. There’s a phase out from $75,000 – $99,999 where you’ll get a smaller check. Those without children are completely phased out at just $87,000.
- Here’s a calculator to figure out how much you’ll earn.
- This check is not taxable, you keep all of it; you won’t have to pay taxes on it at the end of the year like you do on other income.
- Green card holders/permanent residents (“resident aliens”) will receive the stimulus checks.
- See additional details in our post on the first stimulus bill.
Last time around, some people had issues with their bank accounts not being on file with the IRS, and thus a longer wait time until getting physically mailed checks. Hopefully by now you have your bank in their system, if not, you’ll get it in the mail similar to the first time.
$300 Unemployment
The bill supplements the regular state unemployment insurance (UI) by $300 per week. (That’s half the amount of the first stimulus bill.) For example, in California the UI benefit maxes out at $450/week for high earners. Now, you’ll get $750/week with the added $300 from the feds. Also important: the bill offers the $300/week of unemployment even to those workers whose regular benefits have expired – they’ll still be able to get the $300.
The benefit is slated to be in place for 11 weeks from December 28 through March 14. Gig workers will also be able to get this 11 week benefit, just as was the case for the first stimulus round.
You can see our (incomplete) analysis of the Unemployment benefit from the first round in this post.
PPP Funding
The bill revives the lapsed Payroll Protection Program (PPP) which offers loans to small business, including some criteria which allows the loan to be forgiven. With another $284B in funding, more businesses can borrow and get loan forgiveness.
The bill also allows for businesses who already got PPP loan to get a second one (“second draw loan”), though only those who can show drops in revenue of 25%+ are eligible for another round. The second draw is forgivable as well.
An interesting thing settled in this bill is that loans forgiven under PPP (either round) will allow the costs covered by the forgiven loan to be deducted on their tax returns. Seems strange to me, but certainly a nice additional benefit from the PPP forgiveness.
They also added an easy 1-page simplified forgiveness application for loans less than $150,000.
You can see more details on the PPP program in this post from the first stimulus round.
Other
- $45 billion for transportation aid, including $15 billion to airlines, $14 billion for transit systems, $10 billion for highways, $2 billion for airports, $1 billion for airline contractors and $1 billion for Amtrak
- Extends the moratorium on evictions through January 2021; previously this had been slated to end after December
- $25B in unspecified renters assistance
- Business meal expenses in 2021 and 2022 are now deductible; this is done to help revive the restaurant industry
- Extends the time states and cities have to use CARES Act funds through the end of 2021 (previously they had to use it by the end of 2020)
- Bills gives billions of dollars toward vaccine distribution and other health measures
- Gives $13B in increased SNAP benefits
- Gives $82B for schools and colleges
- Gives $7B toward helping certain areas with broadband access
- A certain tax credit for employers who offer paid sick leave
- $10B toward child care assistance
- $20B in EIDL Grants for small businesses (unclear if they’ll have the $1,000 grant offer this time)
- $10B for USPS
Previous Posts
Here are our posts from the first stimulus CARES Act. Not all the details are the same, but some good reference material there:
- Stimulus: Government To Send Out $1,200 Checks/Deposits To Most US Residents; Expanded Unemployment & More
- US Stimulus: Should You File Your 2019 Tax Return Now?
- Stimulus Bill Adds $300 Charitable Contribution Deduction For 2020 & Beyond
- Stimulus Bill Forbids Credit Agencies From Issuing Negative Marks For Certain Deferred Payments
- Stimulus Bill: Making Sense Of The Options For Small Businesses & Employers (Grants + Loans)
- Stimulus Bill: Explaining the Unemployment Benefit for Employees, Self-Employed & Gig Workers
- Stimulus Checks: People Who Don’t File Taxes Can Register Their Bank Info With IRS-TurboTax Online Portal To Get Their $1,200
- Stimulus: EIDL Grant For Small Businesses Will Be $1,000 Per Employee, Per SBA Clarification
- IRS Now Lets You Check Your Stimulus Payment Status
- A Few Updates On Those $1,200 Stimulus Checks
- A Few Updates On The Small Business Grant & Loan Programs (PPP, EIDL Funding Round 2)
- IRS Website Finally Allows You To Add Bank Information For $1,200 Stimulus Direct Deposit
- Lawmakers Overhaul PPP Loan Forgiveness Program For Small Businesses
- EIDL Loan & Grant Program Reopens For New Applications
- Reminder: Get $300 In Tax Deductions With Charity Donations (2020 Only)
Related:
- Stimulus Round 2: Government to Send $600 To Most US Residents; $300 Unemployment Supplement; PPP Funding & More
- Reports: $600 Stimulus Deposits Will Be Received Early Next Week
Got $18K this morning in stimulus payments (married filing jointly & 28 kids).
Are you serious about the kids?
12/30/20 – I received the stimulus this morning via direct deposit
Got $1200 this morning (married filing jointly).
Thats freaking fast just within a day ?
Why are they talking about stimulus for everyone when only people who lost their jobs are affected. Those that are able to keep their job and working from home still get paid. Only people who lost their jobs due to COVID need help to pay their bills and rent/mortgage. Just up the unemployment and keep it up till jobs are available again.
Because it’s a stimulus package, not a covid relief bill. Stimulus means it will stimulate the economy because they want people to go out and spend it on useless shit that makes other people have a job. You aren’t supposed to be paying bills with it, though that’s what the majority will do
Did the $1,200 checks stimulate the economy?
At least stock market took a rocket.
Those who kept their jobs were not unaffected. My spouse’s job itself was safe but benefits were gutted and pay was cut. Between that and my business taking a huge hit, it’s been a challenge, a manageable one made possible only because I keep an emergency fund. Not everyone is as fortunate.
The stimulus checks are to stimulate the economy by giving people money to spend.
This seems to be a special edition “venting” post.
Glad to see some sensible people on here realizing that our governments (federal, state and local) reaction to this virus is an absoulte power grab. People need to rise up immediately before all rights are taken. So much more damage has been done in response to the virus, then the virus itself and its not even close. It’s not about the virus itself, it is about millions who are being forced into poverty, hundreds of thousands whose small business has gone under or severely damaged, the increase in mental health issues, suicide rates, drug abuse, alcohol abuse, spousal abuse and child abuse, the inability of children to get a proper education, to socialize with school mates, to partake in athletics, music, dramas and other extracurricular activities, the thousands of people who couldn’t get into a medical facility to get a lump on their breast checked, a prostate exam, a diabetic check up, a cardiovascular check up. I could go on and on. The response to this virus will prove to be way more damaging then the virus itself, yet so many believe we should shut everything down. Not having a feasible income is extremely damaging to the health of people as well. This doesn’t even take into account the massive overreach of state governors and mayors of cities who will be more then happy to use this as a segue to further abuse of power. Time for people to rise up, rebel against these out of control politicians.
I recently learned that the service that my grandma has that is supposed to take her to get labs/tests done regularly has only picked her up 3x this year. This is an 84 year old who should be going to the dr regularly. How can you justify not giving an elderly woman regular care? Something seems off about that. She used to get checked by a doctor weekly at the facility that she would go to pre-covid. As everyone else has figured out by now, just because COVID exists, the other diseases/sicknesses did not disappear.
Not just politicians….there is abuse at work going on for years.
I read the law, the part that belongs to the stimulus checks. It makes it possible that a family with mixed status, say one spouse US citizen or just with a SSN and, say children/dependents with a SSN but the other spouse has only an ITIN then then everyone who has a SSN can receive the stimulus checks if filed married jointly. Previously, this was not allowed and the spouse with a SSN needed to file married filing separately, along with any dependent with a SSN to receive the stimulus check though, this way would have lowered the qualifying income threshold from $150K to $75K but at least, as long as you didn’t make more than $75, this was a way to bypass the system to get the stimulus checks for the ones with a SSN. The ITIN resident aliens still cannot get the 2nd stimulus checks even though they pay taxes like everyone.
One ray of hope is that, if you are a US resident alien for 2020 and are in the process of getting your SSN, you have until Oct. 15, 2021 to get the SSN and get the stimulus checks by filing the 2020 tax returns once you get the SSN any tike before Oct. 15, 2021. This is not in the bill – my reading of the bill, however, is that you can get the stimulus check as long as you were a US resident alien in 2020 and as long as you file a late return within 3 years of due date of the 2020 tax return (after 3 years, any unclaimed credit is gone). However, the 2020 1040 form and instructions draft, which I saw it – specifically says that SSN needs to have been obtained by the due date, including any extensions, of the 2020 tax return, which is still great news for the ones that are in process of getting SSN giving them more than 9.5 more months to get it form the date of bill approval.
Prez redlined it and sent it back to Congress. Looks like this will kick it to the next Congress re the redlined pork.
He also appointed people to the boards of several of these pork recipients. People suggest this is to monitor where exactly this pork is being spent.
https://www.wsj.com/articles/airlines-arent-making-it-easy-to-use-covid-credits-11609171369?mod=mhp
WSJ article on confusions behind airline credits. Probably useful for a lot of people here.
Wow! Thank you for the article.
I am surprised that these shitty behaviours still surprises me.
Shows you how airlines are scum.
So the the other $1400 comes after I spend this $600? PS5 here I come
If you can find one!