New Stimulus Bill – What You Need to Know About a Second Stimulus Check, $ 200 Unemployment Benefit, PPP and More

By Richard Harroch

On July 27, 2020, Republicans put forth their new stimulus package proposal of about $ 1 trillion called the HEALS Act (Health, Economic Assistance Obligation Security and Schools Act). Democrats previously proposed a $ 3 trillion + stimulus package under the “Heroes Act”, but Republicans rejected it as too broad and too big.

There has been so much news and statements about a new stimulus package that it will become law in reality, it is difficult to understand. This article explains what you should know about the possible provisions of the next incentive bill by answering the most important questions.

1. Will there be another incentive payment?

Yes, there will almost certainly be a second incentive payment, although specific details are in flux. The most likely outcome is a second incentive payment similar to the first payment.

2. What will be the second incentive payment?

The second stimulus payment proposed by Republicans on July 27 would likely be:

  • A lifetime incentive payment of $ 1,200 for each person
  • Married or joint Failron a lifelong incentive payment of $ 2,400 for
  • Lifetime incentive payment of $ 500 to dependents, with no age restriction (Dependents must be under 17 for the Cars Act)

3. What are the income requirements for eligibility for a second incentive payment?

To qualify for a second incentive payment, you will need to earn less than $ 75,000 (for individuals) or $ 150,000 (for married / joint filers) (in 2019).

The original incentive payment provided that if your income was higher than those limits, the incentive payment was reduced by 5% of adjusted gross income above your limit. It is expected that the second incentive payment will have a similar provision.

Republicans initially proposed a $ 40,000 limit instead of the $ 75,000 limit, but the proposal appears to have been abandoned. Democrats proposed a larger stimulus payment ($ 2,000 per month), but would likely not be included in the final package.

4. Will federal supplemental benefits of $ 600 per week be extended for laid off employees?

The original CARES Act hired employees for a $ 600 federal supplemental unemployment benefit payment per week. These supplementary benefits expired on 25 July or 26 July depending on the state.

Democrats want to expand such benefits. Republicans complained that the $ 600 is too much, because it is more than the wages of many workers, discourages the return to work.

On July 27, the proposed Republican package offered $ 200 a week for state unemployment payments instead of a temporary supplement. The $ 200 would then be replaced by a more complex program, which would pay workers 70% of the income they had received before the lost job. Under the Republican proposal, states would phase in 70% of the formula within two months. Given how difficult it is for states to handle large-scale claims of unemployment, it is difficult to see how such an approach is possible within a reasonable period of time.

This is perhaps the most contentious issue; However, it is expected that some agreement will be reached in the next few weeks.

On July 27, some legislators in California have indicated that they will move to pass legislation to fill any gaps in benefits of $ 600 unemployment if Congress has a small amount to help Kaliforniawasion during the economic downturn Approved. Legislative leaders expressed the view that such an additional benefit would be important to prevent economic collapse and ensure that working families could keep their housing and pay necessities.

5. Will independent contractors, freelancers, and gig workers continue to receive additional benefits of $ 600 per week?

The Epidemic Unemployment Assistance (PUA) program contained in the Basic Carr Act provided additional assistance of $ 600 per week for independent contractors, freelancers, and gig workers who were adversely affected by Kovid-19 and otherwise for standard unemployment insurance benefits There were no characters. Under the CARES Act, this assistance is scheduled to continue until December 31, 2020. But there is some uncertainty as to how independent contractors, freelancers and gig workers will be treated, so we may have to wait for the final stimulus bill to be abolished. Uncertainty.

related article: Financial help for freelancers and independent contractors affected by the coronavirus virus

6. Will the Payroll Protection Program (PPP) be extended or extended?

The PPP loan program is due to end on August 8, 2020. PPP has been very helpful to small businesses by offering favorable forgiveness loans.

Republicans proposed an extension of PPP in their new stimulus package, which includes a streamlined amnesty process and a provision that would allow small businesses to take out other PPP loans.

7. Will the new incentive package include payroll tax cuts?

President Trump previously emphasized payroll tax cuts as part of any new stimulus bill. But recently Treasury Secretary Menuchin announced that payroll tax cuts or payroll tax deferrals would not be included initially, but could be added at a later date.

8. Will there be any new student loan waiver provision in the next incentive package?

Although Democrats included student loan waiver provisions as part of their proposed Heroes Act, Republicans did not, and it is unlikely that any additional student loan waiver / deferral provisions will be included in the final stimulus package.

9. Will there be a “return-to-work” bonus for employees?

Senator Rob Portman (R-OH) proposed a “return-to-work” bonus, which would provide financial incentives for people to return to work. If you returned to work by the specified date, the bonus period was for some time $ 450 a week.

At the moment, it is uncertain whether the final incentive package will include such a bonus.

10. What will help to states and cities in the new stimulus package?

Both Republicans and Democrats believe the state and city have been greatly affected by the Kovid-19 epidemic.

Democrats have proposed approximately $ 1 trillion for state and local aid. The Republican proposal of July 27 did not offer the state and local government any additional funding, but it did give them more flexibility in using existing federal aid.

There will be some compromise on this issue, and thus a meaningful amount is likely to be available to help states and cities.

11. Will there be liability protection for litigation arising out of epidemics?

The Republican package of July 27 proposes liability protection from epidemic-generated lawsuits for businesses, hospitals and schools for five years.

Protection would increase the burden of proof for the plaintiff that they would have to prove that a defendant was “grossly negligent or involved in willful misconduct,” and also that they violated state and local public health guidelines at the time.

Democrats have expressed opposition to the concept, so expect talks on the issue.

12. Will tenants living in federally backed mortgaged homes still be evicted from eviction for not paying rent?

The Cars Act provided for a stay of eviction for renters residing in homes with housing supported by the Federation, but expired on July 25, 2020. However, landlords are still required to give 30 days notice before commencing proceedings. With many courts closed due to the epidemic, eviction proceedings will take more than 30 days.

The new Republican stimulus package of July 27 proposed an extension of the moratorium, but the date of the extension is not clear at the moment.

The Republican stimulus package does not provide help for tenants of buildings supported by privately issued mortgages.

13. Will funds be allocated for the trial of Kovid-19?

The Republican proposal of July 27 provides for $ 16 billion in new funding for the coronovirus trial, as well as clarifying that $ 9 billion in funds already approved under the CARS Act will be used for the test.

14. Will funds be allocated for schools?

The Republican proposal of July 27 allocates $ 100 billion for schools aiming at $ 70 billion for kindergarten through 12th grade schools and $ 30 billion for colleges and universities. An additional $ 5 billion has been proposed to be allocated to the governor’s fund for education as the governor sees fit.

Democrats previously proposed $ 430 billion for schools.

15. When will the new stimulus bill be passed into law and come into effect?

The timing of a new stimulus bill depends on negotiations between all Democrats and Republicans, resulting in a final bill, which is then signed by the president. The best estimate is in early August.

The Senate is scheduled to leave on 7 August. If a new stimulus bill cannot be passed by then or if the holiday is not delayed, neither the House nor the Senate is scheduled to return after Labor Day. (7 September).

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Copyright © Richard D. By Harroch. All rights reserved.

About the Author

Richard D. Harroch is the Managing Director and Global Head of M&A at VantagePoint Capital Partners, a venture capital fund in the San Francisco area. His focus is on the Internet, digital media and software companies, and he was the founder of several Internet companies. His articles have appeared online in Forbes, Fortune, MSN, Yahoo, FoxBusiness and Richard is the author of several books on start-ups and entrepreneurship as well as co-authors of Poker for Dummies and a Wall Street Journal-bestselling book on small business. He is the co-author of a 1,500-page book by Bloomberg-Merz and Acquisition of Privately Held Companies: Analysis, Forms and Agreements. With experience in startups, mergers and acquisitions, and venture capital, he was also a corporate and M&A partner at Orrick’s law firm. He has been involved in over 200 M&A transactions and 500 start-ups. Accessible through Linkedin.

This article was originally published View all articles Richard Harroch.


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