Check : Expanded Child Tax Credit For 2021 Which Is More Than Double The Amount Of The Stimulus Checks
The new American Rescue Plan expands the child tax credit that currently allows families to claim a credit of up to $2,000 for children under 17. The plan extends the benefit to lower-income families who otherwise wouldn’t receive the credit. Families can claim as much as $3,600 per year for a child under 6 and up to $3,000 per year for those between 6 and 17. Here’s how often you can expect to get the payments and how to find out if you qualify for the larger payments.
‘help Is On The Way’: Biden On Senate Passing ‘desperately Needed’ Covid Relief Bill
Biden called the aid package “urgently needed” and praised the Senate for passing it Saturday, saying it will get “checks out the door” to Americans “this month.”
“The resources in this plan will be used to speed up manufacturing and distribution of the vaccines, so that we can get every American vaccinated sooner rather than later,” he said.
He praised the Senate and hailed the measure’s “overwhelming bipartisan support of the American people,” referring to polling that indicates the legislation is broadly popular.
The vote was a critical early test of Senate Majority Leader Chuck Schumer’s ability to keep all 50 Democrats unified behind a major piece of legislation despite being an ideologically and regionally diverse caucus.
“From the beginning, we said this: We had to pass this legislation,” the New York Democrat told reporters. “We made a promise to the American people that we were going to deliver the real relief they needed. And now we have fulfilled that promise.”
Schumer said Biden called him and he told the president, “I knew we would get this done.”
Senate Minority Leader Mitch McConnell, R-Ky., blasted Democrats for taking a partisan approach and argued that they would not deserve credit for the economic recovery.
“The Senate has never spent $2 trillion in a more haphazard or less rigorous way,” he said. Democrats inherited a tide that is already turning.”
Healthcare Plans For The Unemployed
Workers who lose their jobs in the United States can stay on their companys health plan for 18 months under the Consolidated Omnibus Budget Reconciliation Act , but will have to pay the full monthly premium. The House of Representatives approved a temporary subsidy of 85% of the insurance premiums. The Senate raised the subsidy to 100% to guarantee that fired workers can stay on their employer health plans at no cost until the end of September.
As the provisions contained in the last two sections were not in the draft law approved by the House of Representatives, the Senate will have to send them back to the lower house so that lawmakers can vote on them before President Biden signs the package into law.
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Republican Senators Softening To Idea Of Second Stimulus Check
Trump may support a second check as mentioned above, and has said that it should be coming along “very soon”, although held back on giving any specific dates. However, the plan also needs the backing of Congress, and with some Republicans in the Senate seemingly still unconvinced about the idea, it won’t necessarily get that approval.
That said, there has been a change in the stance being taken by senior members of the party, as pressure from the White House, rising coronavirus figures and a worsening of the employment outlook take their toll.
Unemployment actually fell by 2.2% in June, but as states roll back their economic reopening plans amid surging numbers of infections, the indications are that the jobless rate is set to rise again.
Minds softening | US Senate Majority Leader Mitch McConnell speaks to the media.Mary Calvert
” still leaves employment 9.6% below its February level and with the spread of the virus accelerating again, we expect the recovery from here will be a lot bumpier and job gains far slower on average, Michael Pearce, a senior economist at Capital Economics, told CNBC.
What You Need To Know
- The House voted to approve President Biden’s $1.9 trillion Covid-19 relief plan. The bill will now go to the White House for Bidens signature.
- The package includes up to $1,400 stimulus checks for some Americans, extends pandemic unemployment benefits and will send billions of dollars in aid to states and municipalities
- Here is a guide of what you can expect to get from the package. See if you’ll qualify for a stimulus check here.
Our live coverage has ended. Read more about the stimulus bill here.
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How To Trade The Us Covid Stimulus Package
Given what we now know about stimulus packages and their effect on the financial markets, how can we apply this to the recently approved US stimulus plan?
The proposed package is worth around $1.9 trillion and will largely take the form of stimulus cheques for US citizens but also money for small businesses, tax credits and other benefits.
With an increase of this size in the money supply, you would expect the US dollar to weaken against other major currencies, a pattern it has followed since the outbreak of the pandemic. In no other currency pair has this been more prevalent than the EURUSD, so we could see even further gains in the euro against the US dollar in 2021.
Depicted: Admiral Markets MetaTrader 5 – EURUSD Daily Chart. Date Range: 13 November 2018 – 3 March 2021. Date Captured: 3 March 2021. Past performance is not necessarily an indication of future performance.
However, a fall in the US dollar will benefit US exports, which will become relatively cheaper to foreign consumers. The shares of exporting companies, therefore, are likely to benefit from a weaker US dollar.
Technology giant Apple, which is one of the biggest exporting companies in the US with around 60% of their revenue accounted for by foreign sales, could be one company which will benefit from the stimulus package and a weaker US dollar.
Student Grants Student Loans And Work
- Creates a 14-billion-dollar higher education emergency relief fund to provide cash grants to college students for costs such as course materials, technology, food, housing, and child care. Each college will determine which of its students receive cash grants. This was divided into three pieces: $12.5 billion in formula funds, at least half of which must be given directly to students, $1 billion for institutions serving minorities, and $350 million in supplemental funds for small institutions with unmet needs. Though the Department of Education issued guidance that international and undocumented students are ineligible for these funds, this was challenged in a lawsuit.
- Payments of student loan principal and interest of by an employer to either an employee or a lender is not taxable to the employee if paid between March 27, 2020, and December 31, 2020. The maximum amount that is tax-free is $5,250 per employee.
- For college students in a federal work-study program, allows a school to continue to pay a student if the student is unable to fulfill their work-study obligation due to the COVID-19 public health emergency.
- Gives students and colleges flexibility regarding the requirements for federal student financial aid during the COVID-19 pandemic.
- Suspends payments and accrual of interest on federal student loans through September 30, 2020. Suspends garnishments and tax refund interception related to federal student loans through September 30, 2020.
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Past Negotiations On Stimulus Checks Varied In Pace
Looking back at past negotiations that resulted in stimulus checks being sent out to Americans the urgency of the situation was the most determinant factor in how long it took. Congress and the White House acted swiftly to get the first round of stimulus checks passed with little resistance. The direct payments of up to $1,200 payments per adult began landing in accounts just a matter of weeks after the official start of the pandemic.
Although calls for more stimulus checks began almost immediately, Congress didnt get down to brass tacks until the summer. Those negotiations dragged out as a false sense of security gripped the nation despite a second covid-19 wave in the summer. The three-way negotiations between the White House, Congressional Democrats and Senate Republicans seemed to go in endless circles. Only when lawmakers’ feet were to the fire with a government shutdown looming was there any meaningful momentum to get the job done.
The third stimulus check became part of the post-presidential campaign for control of the Senate. The $600 per adult and child was blasted by former President Trump as too little, and he called for $2,000. The Democrats and some Republicans ran with the ball, which in part helped push the two Democratic candidates in run-off races for the Senate over the finish line.
House Approves $19 Trillion Covid Relief Package Sending Bill To Biden
Washington The House approved the final version of President Biden’s $1.9 trillion coronavirus relief bill on Wednesday, handing the new president a significant legislative victory as he works to stabilize an economy still struggling to rebound from the depths of the COVID-19 pandemic.
The bill, known as the American Rescue Plan Act, passed by a vote of 220 to 211. One Democrat Representative Jared Golden of Maine joined all Republicans in voting against the measure. Golden had previously voted against the House version of the bill which passed last week. The legislation will soon head to Mr. Biden’s desk, where he will sign it on Friday, the White House said. The Senate approved the bill along party lines following a marathon voting session on Saturday.
Just 49 days into his presidency, Mr. Biden has secured what could prove to be the defining domestic policy accomplishment of his presidency, injecting hundreds of billions of dollars into the economy and bolstering his administration’s efforts to accelerate vaccinations, reopen schools and get jobless Americans back to work. The president, Vice President Kamala Harris and first lady Dr. Jill Biden plan to travel to promote the package once it clears Congress and is signed into law Friday, White House press secretary Jen Psaki said.
“What do we say to America?” he said. “We say to America, ‘Help is on the way.'”
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Legislation Heads To The House Next
told CNN’s Wolf Blitzermembers who are disappointedits members have tested positiveself-quarantinedavoid bringing the full House back to WashingtonThis story has been updated to include additional developments Wednesday.
CNN’s Phil Mattingly, Paul LeBlanc and Veronica Stracqualursi contributed to this report.
Check : $300 In Additional Weekly Unemployment Benefits Including A New Tax Break
Under the new legislation, federal unemployment checks have been extended to Sept. 6 at a $300 weekly rate. The package also reduces the tax burden on the unemployment money for households earning less than $150,000 a year. The new law renewed the weekly $300 federal unemployment checks, which would’ve expired March 14, without a gap in funding.
The plan also removes a provision that you have to make $2,500 a year to receive the credit and makes the credits fully refundable. In addition, it expands tax credits for one year to help cover the cost of child care. Families could get back as a tax credit as much as half their spending on child care for children under age 13, up to $4,000 for a single child and $8,000 for two or more children.
The new law provides financial assistance to families with children.
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What About Money For Coronavirus Vaccine Distribution
More than 161 million vaccine doses have so far been administered in the US — and over 207 million distributed. More than a month early, the country reached Biden’s goal of 100 million jabs during the first 100 days of his administration , with a new goal of 200 million shots in the first 100 days.
The president’s plans set aside $160 billion for a nationwide vaccine program that’s been helping state and local governments get the vaccine into people’s arms.
Changes To Tax Credits
the Earned Income Tax Credit and the Child Tax Credit .
The EITC is a tax credit that provides financial assistance to workers earning around $57,000 or less. The credit is partially refundable , which means it can reduce your taxes or increase your refund.
You may qualify for the EITC with or without children but currently, the credit is fairly small for people without kids. For 2021, you can qualify for a maximum credit of $6,728 if you have up to three children. However, for childless taxpayers, the total amount you can claim is $543.
Biden proposes to temporarily increase the EITC for childless workers for one year, allowing those who qualify to claim a credit of up to $1,500. The EITC will remain unchanged for those with kids.
The bill also contains big changes to the child tax credit although theyre temporary and will only last for one year. Under the current law, a person might qualify to claim a credit of up to $2,000 per child under 17. Bidens plan greatly boosts the credit, increasing the CTC up to $3,600 for children ages under the age of 6. Children ages six to 17 might qualify for a credit of up to $3,000. Another provision in the package would allow the credit to be fully refundable to those who qualify.
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Supreme Court Justice Stephen Breyer To Retire
Washington The Senate on Wednesday approved a historic, $2 trillion stimulus package to provide a jolt to an economy reeling from the coronavirus pandemic, capping days of intense negotiations that produced one of the most expensive and far-reaching measures Congress has ever considered.
Funds For Local Governments
Unlike prior stimulus packages, this one provides $350bn for local governments, many of which are facing higher expenses and lower revenues due to the economic downturn.
But Republicans have fought it as a handout to primarily Democratic states, noting research that shows that the budget situation in many states is better than expected. California even has a surprise surplus.
The Democratic plan would send at least $500m to every state, with additional funds determined by the number of jobless workers. Cities and countries, tribes and territories are also in line for money.
AZ: This has been one of the big political battlegrounds in every Covid-19 stimulus bill. Republicans have been able to successfully block aid to states and cities in the past, saying they were a handout to high-tax liberal enclaves. This time around, however, they don’t have the votes to stop it.
Republican support: 1/5
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What Is A Stimulus Package
A stimulus package is a package of economic measures a government invokes to stimulate a floundering economy. The objective of a stimulus package is to reinvigorate the economy and prevent or reverse a recession by boosting employment and spending.
The theory behind the usefulness of a stimulus package is rooted in Keynesian economics, which argues that recessions are not self-correcting therefore, government intervention can lessen the impact of a recession. For example, a stimulus, or increased government spending, can compensate for decreased private spending, thereby boosting aggregate demand and closing the output gap in the economy.
What’s Going On With The Student Loan Debt Forgiveness
In March, President Joe Biden’s administration approved a $1 billion loan forgiveness for students who were defrauded by their colleges, or if their school shut down. The change is projected to affect 73,000 people.
Though forgiving student loan debt has been part of the discussion since January, Senate Democrats and the president have different dollar figures in mind for how much to cancel. Biden on Feb. 16 said he supports canceling $10,000 in student debt per borrower and extending the pause on student loan repayment. His figure is at odds with a Senate Democrat proposal, however, that calls for canceling up to $50,000 in student debt per borrower.
“I do think that, in this moment of economic pain and strain, that we should be eliminating interest on the debts that are accumulated, No. 1. And No. 2, I’m prepared to write off the $10,000 debt, but not $50,000,” Biden said. While the House and Senate versions of the bill don’t forgive student debt, the legislation includes a provision that will make tax-free any forgiven student loan, according to The New York Times.
Canceling student debt didn’t make the bill.
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Congress Finally Passes The $19 Trillion Covid
We’re inching closer to a third stimulus check. After some unexpected delays, Congress finally passed the bill containing President Biden’s $1.9 trillion stimulus package on Wednesday afternoon. The bill will now be sent to the White House, where President Biden is expected to sign the legislation on Friday.
However, the stimulus check plan in the original version of the bill is different than what’s found in the final bill. While in the Senate, a more aggressive stimulus check “phase-out” rate was added. The new rate made the stimulus check provisions more “targeted” to people who need assistance the most. As a result, according to the Institute on Taxation and Economic Policy, nearly 12 million American adults who would have received a partial third stimulus check under the original bill won’t get any payment under the final bill.