By Gregory Bilecki, Senior Accountant
What’s Included in the Third Stimulus Package?
Signed by President Biden Thursday, March 11th, is the next round of COVID-19 relief, H.R. 1319, also known as the American Rescue Plan Act of 2021, which includes $1.9 trillion of additional funding that will provide additional money for:
- Additional stimulus payments for individual tax filers with amounts up to $1,400 each for those taxpayers whose AGI does not exceed $75,000 and for those married filing jointly whose AGI does not exceed $150,000
- A new federal income tax waiver on the first $10,200 of unemployment benefits received for individual filers and $20,400 for those married filing jointly retroactive to 2020 for recipients with less than $150,000 in AGI (individual or married filing jointly)
- An expansion of the current weekly $300 provisional Federal unemployment payment through Monday, September 6th, 2021 (Labor Day)
- The expansion of the earned income credit by three times the amount and the lowering of the age to qualify from 25 to 19
- An expansion of the child tax credit for one year for children aged 6-17 up to $3,000 annually per child, as well as $3,600 for children under 6 years old
- An expansion of the employee retention credit extended through December 31, 2021 with an additional ERC of $50,000 per quarter for certain start-up businesses
In Addition, Other Relief Included in the Package:
- $350 billion in aid for state governments to provide support for missed tax revenue collections, keep employees on payroll, and support other state services
- $120 billion in aid for K-12 schools
- $86 billion to help multiemployer pension plans continue to pay
- $30 billion in grants for restaurants, with preference given to women, veterans, and socially and economically disadvantaged groups only during the first 21 days of the program
A predominant lack of guidance for most of the new measures still exists which means that processes to receive many of the benefits outlined above are not currently in place and may not be by the forthcoming tax deadlines in March and April. Please pay attention to our website for additional details as they are released, as well as IRS.gov for all final federal government tax reporting rules, regulations, and information.