With President Joe Biden’s signature on the $1.9 trillion relief package still drying, millions of Americans can breathe a sigh of relief that help is on its way.
This massive bill is, as Biden himself once said of the 2010 Affordable Care Act, a big freaking deal.
The various provisions will help see 16 million fewer people living in poverty in 2021, according to the Urban Institute.
And for all individual Americans like you, marking a full year into the pandemic, the bill offers many ways of accessing direct help from the government to get through this global crisis.
1. Stimulus checks
With Biden’s signature on the bill, the long-awaited $1,400 stimulus checks are now days away from being sent out.
Every American bringing in $75,000 (or $150,000 for couples) is set to receive their checks as soon as the end of the month.
You can expect to receive the full $1,400 for every member of your household, including your young children, teenagers, dependents in college and eldery and disabled dependents.
The major change with the third checks is the new cut-off income limit. While earners above $75,000 wouldn’t have received the full amounts of the first and second checks, they would still have collected partial payments. Now, anyone making more than $80,000 (or $160,000 for couples) gets nothing.
If you fall in the category of people not getting anything, but you were counting on those funds to pay down debt, a lower-interest debt consolidation loan may be the solution you need to get your head above water.
2. Money for families
Using the same $75,000 income limit as the stimulus checks, the bill also includes a beefed-up child tax credit. Over the second half of the year, you can expect to receive monthly payments of $250 per child aged 6 to 17.
If your kids are younger than 6, you’ll get $300 a month.
That brings the tax credit for 2021 up to $3,000 or $3,600, depending on age, with the second half of the credit fully refundable on your 2021 taxes.
The rescue bill not only increases the amount families will receive by up to $1,600 per child, from its original $2,000 maximum, but it also makes the entire credit fully refundable.
If you don’t need the money to cover immediate expenses, this may be a perfect opportunity to teach your children about managing money. You can deposit some (or all) of their funds in a debit card designed for kids where you can monitor every purchase through a safe, secure app.
3. Unemployment benefits
Federal unemployment benefits were set to expire March 14, which added to Congress’s urgency to pass the relief bill in time to extend those payments to the fall.
If you lost your job in the pandemic, you can now expect to continue to receive $300 a week from the federal government until Sept. 6.
When the Senate passed the bill last week, lawmakers added an amendment whereby the first $10,200 of those benefits would be tax-exempt for households making less than $150,000.
The bill also includes freelancers, gig workers and those with side hustles, offering them additional support through the Pandemic Unemployment Assistance program.
While these workers don’t usually qualify for unemployment, throughout the pandemic, the assistance program has provided them with up to 79 weeks of benefits, up from the current 50-week limit.
4. Emergency assistance for housing expenses
Also tucked into the bill is help for Americans struggling to pay their housing expenses, whether that be rent or a mortgage.
For renters, the bill offers nearly $22 billion in rental and utility assistance for those who are at risk of being evicted. The funds will mostly be allocated to the Coronavirus Relief Fund, which was initially created through the CARES Act.
Households have to meet several conditions to qualify for the financial assistance on rent, utilities or other housing expenses. Priority will be given to lower-income families with members who have been unemployed for three or more months.
For homeowners whose struggles can’t be resolved by refinancing their loans at a lower rate, the bill includes billions to help them with their mortgage payments, utility bills and other housing costs, like homeowners insurance.
And there’s a chunk allocated to pay for housing counseling for both renters and homeowners so that more people stay in their homes.
5. Health insurance discounts
Another provision in the relief package will not only temporarily lower the cost of health insurance for those already covered, but also potentially expand coverage to 1.3 million Americans.
If you’re not covered through an employer or government plan like Medicare or Medicaid, this provision ensures your marketplace premiums will be capped at 8.5% of your income for the next two years.
And the plan now makes those subsidies available to people who are earning more than four times the federal poverty rate, which is approximately $51,520 for single people and $106,000 for a family of four.
Under the proposed changes, a 64-year-old woman with a $58,000 income would see her premiums reduced from $12,900 to $4,950, according to the nonpartisan Congressional Budget Office (CBO). That’s a 61% savings.
So if you plan to shop around for health insurance during the current special Obamacare enrollment period, which runs till mid-May, you may soon be able to take advantage of lower out-of-pocket costs.
Finally, if you received a premium subsidy in excess of what you were entitled to last year, the bill offers some potential relief as well. Usually, you’d have to pay back the difference to the IRS. But this year — and this year only — you won’t.
So when you fire up your tax software your refund could be bigger than it would have otherwise been.
6. COVID-related paid leave
Another addition to the legislation provides paid-leave benefits for federal workers.
They’ll be given up to 600 paid hours (capped at $1,400 a week) to use if they’re showing symptoms of the coronavirus; caring for a family member sick with the virus; taking time off to get vaccinated or suffering from symptoms of the vaccine; or caring for children who are in virtual learning or facing school or childcare-center closures.
And for employers with fewer than 500 employees, the package offers them resources to provide as much as $1,400 a week in paid leave. But the bill doesn’t mandate that employers offer sick leave; it just gives reimbursement if they choose to do so.
7. Tax savings if your student loan debt is canceled
For the 44.7 million Americans with student loan debt, the package contains a significant provision.
Before the bill was signed, if any of your student loan debt was canceled by the government, it would have been considered taxable income. That meant the IRS would treat the canceled debt as if it were a chunk of your salary.
The bill now makes student loan forgiveness tax-free, which will save many struggling Americans thousands of dollars.
To put it into perspective, with the passing of this law, if $50,000 of your debt is ever canceled, which members of the Democratic party are pushing hard for (via a bill that only applies to federal student debt), you could avoid receiving a tax bill of up to $10,000.
Even just $10,000 worth of cancelation would save you at least $2,000 when you file your return.
If debt cancellation isn’t in the cards for you, you still have some savings options. You could save yourself hundreds of dollars a month — and pay off your loan faster — simply by refinancing your loan at a better rate.
