March 9, 2021 12:53pm
What’s in the American Rescue Plan Act?
Congress is expected to pass the American Rescue Plan tomorrow morning, with President Joe Biden likely to sign it into law shortly thereafter. The $1.9 trillion COVID relief bill is expansive and includes numerous provisions that will directly affect Greater Louisville. See below for some of the bill’s key provisions.
- Direct economic impact payments of $1400 per individual. single filers with incomes up to $75,000, head of household filers with incomes up to $112,500, and joint filers with incomes up to $150,000 will receive the full payment of $1,400. Payments are phased out for single filers making $80,000, head of household filers making $120,000, and joint filers making $160,000.
- The Child Tax Credit is expanded. The credit will become fully refundable for 2021 and will increase from $2000 per child to $3000 per child or $3600 for children under the age of six. Payments will be based on 2019 or 2020 tax returns. single filers earning up to $75,000, head of household filers earning up to $112,500, and joint filers earning up to $150,000 would be eligible to receive the full refundable credit. The credit is phased out for incomes above these thresholds.
- Extended unemployment insurance benefits through September 6, 2021, and maintains the weekly supplement unemployment benefit at $300 per week.
- $7.25 billion for the Paycheck Protection Program
- $28.66 billion for a Restaurant Revitalization Fund
- $15 billion for Economic Injury Disaster Loan program
- Extended Employee Retention Tax Credit through December 31, 2021 and increased eligibility and applicability.
- Extended Payroll Tax Credit for paid sick leave and paid family and medical leave.
- $350 billion for states and localities for economic relief (Coronavirus Relief Funds) with new eligible expenses including:
- Investment in water, sewer, and broadband infrastructure
- Retention of essential workers and premium pay
- Ineligible expenses include pensions and tax cuts
- Kentucky is expected to receive a total of $4.2 billion of these funds with $2.4 billion for the state, $445 million for Metro Cities, $886 million for counites, in addition to other funds.
- Indiana is expected to receive a total of $5.8 billion of these funds with $3 billion for the state, $853 million for Metro Cities, $1.3 billion for counites, in addition to other funds.
- $39 billion for the Child Care and Development Block Grant and an expansion of the Child and Dependent Care Tax Credit.
- Expanded subsidies in the Affordable Care Act Marketplace, including removal of the subsidy cap for individuals with incomes at 400 percent of the poverty line, a cap on 8.5 percent of an individual’s income for silver plan premiums, a provision allowing individuals below 150 percent of the poverty line to pay no premiums.
- $27.5 billion for rental assistance, $10 billion for homeowners, and $5 billion for utility payments.
- $20 billion to support COVID-10 vaccine deployment
- $51 billion for testing and contract tracing
- $130 billion to support the reopening of K-12 schools (for example: improving ventilation systems, reducing class sizes, and educational remediation)
- $40 billion for colleges and universities
- Forgiven student loan debt will not be considered taxable income for the years 2020 to 2026.
- Stabilization of multiemployer pension plans.
- New funding to address health disparities.
Note, the Senate version of the bill did not include a federal minimum wage increase.