What can you expect from the new Covid bill

covid relief bill

Today, the U.S. House of Representatives has passed the American Rescue Plan Act of 2021, the 3rd round of COVID relief. President Biden is expected to sign the bill by the end of the week. There were some key changes to the original bill, specifically related to stimulus payments and jobless benefits. See how they look in the final bill:

 

Stimulus Payments
After Senate negotiations regarding stimulus payments, an agreement was made to lower the income threshold. Under the lower thresholds, adults can expect a $1,400 payment ($2,800 if married) if they make less than the threshold.

  • Single taxpayers must earn less than $75,000. Payment starts to phase out between $75,000 – $80,000. Earners making more than $80,000 do not qualify.
  • Head of Household must earn less than $112,500. Payment starts to phase out between $112,500 – $120,000. Earners making more than $120,000 do not qualify.
  • Married and filing jointly can make no more than $150,000. Payment starts to phase out between $150,000 and $160,000. Earners making more than $160,000 do not qualify.

Parents can also expect a payment of $1,400 per dependent listed on their tax returns, including adult dependents which were left out of previous relief bills. A family of four whose income falls below the threshold can expect a stimulus payment of $5,600.

 

Unemployment Benefits
The changes to unemployment benefits were the hot topic on the Senate floor. A couple of proposals to amend the bill’s original unemployment benefit extension were argued, but the one that ultimately won out looks like this:

  • The additional federal unemployment benefit stays the same at $300 per week
  • Benefits extended through September 6, 2021
  • The first $10,200 in unemployment benefits will be non-taxable.

As with prior stimulus payments, the IRS will issue payments using direct deposit if they have your bank account on file. It is important that you file your taxes ASAP if your 2020 income is less than your pre-pandemic 2019 income to be sure you get the maximum payment in which you are qualified.
If you have not filed, we have you covered. Use our do-it-yourself IOOGO Tax or let one of our tax pro’s handle it. File your return today!

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