July 29, 2020

Next stimulus bill: HEALS Act would offer more than just another check


A new $1,200 stimulus check could be just one of the benefits you might receive from the HEALS Act. Here are the other incentives proposed to offset the worst financial effects of the coronavirus pandemic.

For the most up-to-date news and information about the coronavirus pandemic, visit the WHO website.

For many, the big news about the HEALS Act — the Senate Republicans plan for the next stimulus package — was the second stimulus check. But a $1,200 payment for those who would meet the requirements may not be the piece that has the most impact on your budget. If the bill passes, it will also renew enhanced unemployment assistance (at a much lower threshold) and set aside more than $100 billion for school reopening.

We’re far from getting a final bill and bipartisan negotiations are already fierce. In a statement Tuesday, Speaker of the House Nancy Pelosi criticized the plan’s $400 decrease in unemployment insurance, saying that it “destroys families’ financial security” at a time when many have lost jobs as a result of the pandemic. That reduction in particular is expected to be a sticking point with Democrats that could even jeopardize the entire stimulus bill

There’s also been dissent among Republicans, including Texas Senator Ted Cruz, who expressed concern over the bill’s price tag and called it “the wrong approach,” CNN reported.

Here are the major pieces Democrats, Republicans and White House officials are pushing to include in the next stimulus package — and how likely we are to get them before Aug. 7, the last day before the Senate is set to break for its month-long August recess. This story updates often with new information.

Second stimulus check: Designed to help you spend

What it is: A payment sent to qualifying individuals and families, based on annual income, age, number of dependents and other factors. The first stimulus checks authorized under the CARES Act have gone out to over 160 million Americans — either as a check, prepaid credit card or direct deposit. But not without a hitch and after three months some are still waiting for their payment.

How it could help you: The payment is not taxable and you can use it however you want to pay for food, housing, clothing and so on. The idea is that spending the checks helps the economy recover faster.

Why we think a second check will pass: The CARES act authorized payments up to $1,200 per eligible adult and so does the HEALS Act. The House of Representatives’ HEROES Act, meanwhile, called for $1,200 stimulus checks, but for more people. The White House also supports another round of checks, which makes this a likely part of the final bill.

More unemployment benefits for jobless Americans

What it is: An additional weekly check for people who applied for unemployment for the first time or were already collecting unemployment. The program initially granted by the CARES Act provided an extra $600 per week and expired on Saturday, but lawmakers are looking into another unemployment boost now.

How it could help you: An extra weekly payment on top of the ordinary unemployment benefit gives individuals and families a leg up and cutting it off or reducing it could be devastating for both unemployed workers and the economy.

Why we think it could happen: Republicans support the exension, though at a reduced rate, saying $600 a week is too generous. “We have learned what we knew at the time,” Senator Chuck Grassley said Monday, “That when you pay people more not to work than they would get working, what do you expect? People will not work. And what this country needs is more workers.”

Democrats support an extension at the current $600 rate and balk at the Senate proposal, which would extend benefits based on 70% to 75% of lost wages, starting at $200 a week and over time increasing to $500 a week, with state assistance. With no agreement on a second package close, the two sides may decide to extends the benefits for a few weeks while they hammer out the details of the bill: We have discussed a short-term extension to [unemployment insurance] and the evictions so that we have some period to negotiate before it runs out,” Treasury Secretary Steven Mnuchin said on Wednesday.

Payroll Protection Program to help businesses hang on to employees

What it is: Intended to help you retain your job, the Paycheck Protection Program provides forgivable loans to small businesses as an incentive to keep employees on the payroll. 

How it could help you: The program is designed to fund workers employed who would otherwise have lost their jobs during the pandemic. The program got off to a rocky start and it’s not clear the PPP met the goals Congress set for it. 

“Overall PPP hasn’t preserved many paychecks,” wrote Joshua Gotbaum, a guest scholar of economic studies at the Brookings Institution. “A careful study [PDF] found that PPP-eligible small businesses laid people off just as quickly as other businesses,” he said.

Why we think it could get extended: The Republican proposal will target the hardest-hit small businesses, Sen. Susan Collins of Maine said Monday, including those with revenue losses of 50% or more over last year.

A tax credit would help with your pay.Angela Lang/CNET

Employee retention tax credit would help pay workers

What it is: Under the program, an employer can receive refundable tax credits for wages paid to an employee during the pandemic. The employer can then use the credits to subtract from — and even receive a refund over — taxes they owe.

How it could help you: Again, it’s not a direct payment to you, but the program encourages businesses to keep workers on the payroll.

Why we think it could happen: Grassley said the HEALS Act includes further tax relief for business who for hire and rehire workers and the Democrat-backed Heroes Act also builds on the tax credits that were part of the initial CARES Act. And there’s additional bipartisan support besides.

Return-to-work bonus of up to $450 each week

What it is: A temporary weekly bonus for unemployed workers who secure a new job or are rehired, on top of their wages. As proposed by Sen. Rob Portman, a Republican from Ohio, the bonus would be $450 a week.

How it could help you: Under Portman’s plan, the weekly bonus would go to laid-off workers who return to work.

Why we think it may not happen: The White House in May expressed interest in the bonus and Portman continues to support the idea, but it’s not part of the proposal McConnell and the other Senate presented on Monday.

Rental assistance to keep evictions at bay

What it is: This plan would help renters pay rent and assist landlords with expenses with less rent money coming in, especially as the US faces a potential “tsunami of evictions.”

How it could help you: The rental assistance program would temporarily help you pay rent if you qualify, put a hold on evictions for a year and help cover costs of rental property owners because of rental payment shortfalls.

Why we think it could happen: House Democrats included an eviction moratorium in its proposed Heroes Act. It was not part of the Senate presentation on Monday and these protections have now lapsed.

Payroll tax cut so employees get bigger paychecks

What it is: President Donald Trump has for months pushed the idea of including temporary payroll tax cuts in the next stimulus package. The proposal could include cutting both the employer and employee share of payroll taxes.

How it could help you: If you have a job, a payroll tax cut would let you keep more of your earnings each check. The plan would not help those who are unemployed and don’t receive a paycheck. As of July 4, the nearly 32 million people who were claiming unemployment insurance would not benefit.

Why we don’t think it’ll happen: Neither the Heroes Act nor the current Senate plan includes a payroll tax cut. Even Trump seems to have given up on the plan.

Until we know for sure what the finalized stimulus bill will bring, there are some resources to help you through the financial crisis, including coronavirus hardship loans and unemployment insurance; what you can do if you’ve lost your job; what to know about evictions and late car payments; how to take control of your budget; and if you could receive two refund checks from the IRS.

By Clifford Colby, Erin Carson

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