Congress Passes $2.2 Trillion Coronavirus Relief Package
The U.S. House of Representatives followed the Senate Friday and approved a $2.2 trillion relief package dealing with the health, safety, and economic impact of the coronavirus pandemic.
The Coronavirus Aid, Relief, and Economic Security Act, or CARES Act, is the largest stimulus package ever passed by the U.S. Congress.
The bill provides economic relief to individuals, small businesses, and industries particularly hard hit by the coronavirus.
Under the act, small businesses—companies with less than 500 employees—will receive $377 billion in aid.
The Small Business Administration will distribute $350 billion of that funding through a dedicated loan program, up to $10 million per company.
Any portion of an SBA loan used to maintain payroll may be forgiven if a company’s employees remain employed through June.
The bill also provides $10 billion in emergency funds for immediate operational costs and $17 billion to cover six months of payments for those already utilizing SBA loans.
The legislation also sets aside approximately $500 billion for large corporations, including industries most impacted by the pandemic.
$58 billion is allocated to airlines to help them continue operating, including $25 billion for passenger air carriers, $4 billion for cargo air carriers, and up to $3 billion for airline contractors.
To assist a broader range of businesses, the bill creates a fully refundable tax credit for businesses that are closed or distressed to keep employees at work and covers 50% of payroll on the first $10,000 of compensation.
For businesses with over 100 employees, the credit is for wages paid to employees whose hours were reduced because of the pandemic.
Employers with 100 or less employees are eligible for the deduction even if they aren’t closed.
Additionally, an employer could contribute up to $5,250 in student loan payments tax-free, meaning the employee wouldn’t have to include that money as income.
The largest funding portion of the bill—$560 billion—will go to assist individuals and families.
Of the $560 billion, $300 billion will be issued to individuals in the form of direct checks.
Individuals earning less than $75,000 can expect a one-time cash payment of $1,200.
Married couples each receive a check and families would get $500 per child, meaning a family of four earning less than $150,000 can expect $3,400.
Individuals making more than $99,000 and couples making more than $198,000 will not receive direct payments.
Expanded Unemployment Benefits
$260 billion will go towards enhancing unemployment benefits by increasing paid benefits and expanding eligibility.
The bill provides an additional $600 per week for four months from the federal government on top of the base amount an employee receives from the state.
The legislation also calls for an additional 13 weeks of unemployment insurance.
The creation of the Pandemic Unemployment Assistance program allows self-employed individuals to apply for unemployment through the end of the year.
State and Local Governments
$340 billion was designated for programs that will go to state and local governments.
$270 billion will go toward COVID-19 response efforts, including $150 billion in direct aid for those state and local governments most heavily impacted by the virus.
The bill also provides $5 billion for community development block grants, $13 billion for K-12 schools, $14 billion for higher education and $5 billion for children and family programs.
$153 billion was set aside for public health efforts combating the coronavirus pandemic.
Of that sum, $100 billion will go to hospitals, $20 billion to Veterans’ Administration medical facilities, and $1.3 billion to community health centers.
CDC, Public Assistance
$80 billion will go to the Federal Drug Administration to expedite drug approval, with another $11 billion reserved for diagnostics, treatment, and vaccines.
The Centers for Disease Control and Prevention will get $4.3 billion.
$16 billion will go towards replenishing the strategic national stockpile to increase availability of ventilators and masks.
With unemployment soaring, assistance programs are also running low on funding.
$15.5 billion is going to the Supplemental Nutrition Assistance Program, also known as SNAP, to cover the cost of new applicants, with an additional $8.8 billion for school meal programs and $450 million for food banks.
There are also various non-monetary provisions to help bolster the economy, including delaying the federal income tax filing deadline until July 15 and deferring student loan payments until September 30.
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