Early this morning, March 25, Senate Majority and Minority Leaders Mitch McConnell and Chuck Schumer, along with U.S. Treasury Secretary Steven Mnuchin, announced that an agreement has been reached over the third bill to address the impact of coronavirus and the disease it causes, COVID-19, in the United States. House Speaker Nancy Pelosi said she hopes to pass the bill in the House of Representatives by unanimous consent, meaning she will not have to call self-quarantined or self-isolated members back to Washington D.C. for a vote, though she warned this is not a certainty. Secretary Mnuchin stated that President Trump is eager to sign the new bill “as written.” The cost is anticipated to be in the range of $2 trillion.
While the details have yet to be announced (indeed, the final bill is still being written), the Senate bill had included a suspension of employer payments of payroll taxes – 50% of unpaid 2020 payroll taxes would be payable December 31, 2021, and the remaining 50% payable December 31, 2022. It provided rebate checks to taxpayers of $1,200 per individual adult, $2,400 per married couple, and $500 per child, though taxpayers with incomes above $75,000 (individual) / $150,000 (couple) would see reduced rebates and those with incomes over $99,000 / $198,000 would receive no assistance.
It is reported that a significant expansion of unemployment benefits is included, and that this will encompass the extension of unemployment payments to workers in the “gig economy,” such as Uber and Lyft drivers and those who freelance, as well as adding $600 to weekly unemployment assistance for four months.
We are told there are provisions for assistance to the health care system of $150 billion, another $150 billion to state and local governments, and $350 billion in loans to small businesses, which would be forgiven if the funds are used to keep employees on payroll.
Democrats had objected to a $500 billion loan fund for larger corporations, a portion of which would have been directly under the authority of Secretary Mnuchin. The agreement reportedly will create an oversight board and a new inspector general position to oversee the distributions of aid. There will also be a ban on using the funds for stock buybacks during the term in which aid is received and for one year thereafter.
If you have questions on the stimulus package and how it might – depending on the final bill’s provisions – impact your business, please click here to email me directly – I am here to help.
Until next Wednesday –