What $2 trillion stimulus package means for businesses, individuals

Home COVID-19 What $2 trillion stimulus package means for businesses, individuals

The $2 trillion stimulus package has provisions for businesses and individuals.

On Friday, March 27, President Trump signed the largest stimulus bill in American history, a record-breaking $2 trillion aid package designed to provide a boost to nearly all parts of the economy.

Small businesses and working-class Americans have no doubt taken the brunt of the economic downturn since the coronavirus (COVID-19) pandemic began. The bill aims to help those in need by way of expanded unemployment insurance, paid leave, relief checks and more.

Small business owners—including specialty flooring retailers—can review relief coming their way below, as published by Forbes.

Unemployment insurance

The new law expands unemployment benefits dramatically, with an additional federal payment boosting normal benefits. Here are the details:

  • In addition to normal state benefits, an additional $600 per week will be paid to individuals for up to four months. This boost will help individuals earn around the median weekly wage.
  • Benefits will last longer, too. Regular state unemployment eligibility of 26 weeks has been expanded by an additional 13 weeks, for a total of 39 weeks.
  • The package expands unemployment insurance to those who don’t typically qualify: Gig economy workers who are classified as independent contractors and self-employed individuals.
  • Individuals who haven’t been laid off, but can’t work due to a variety of reasons related to COVID-19, would also be eligible for unemployment checks. These reasons would include a case where they were diagnosed with COVID-19, were awaiting a diagnosis or had a family member diagnosed with the disease. Individuals who were scheduled to start a job, but could not because their future workplaces had been shut down due to the COVID-19 pandemic, would also be eligible. Additionally, individuals whose head of household died directly due to COVID-19 will be eligible.
  • Workers who are furloughed but haven’t been fully laid off are eligible.
  • The seven-day waiting period before an unemployed worker can get benefits, which is a standard feature of most states’ unemployment systems, is being waived to help individuals receive cash as quickly as possible.

If you’re considering filing for unemployment, there are other provisions experts recommend considering first, such as exhausting paid sick leave, which could end up paying you more than unemployment insurance. Keep in mind there are already reports of unemployment offices experiencing an overwhelming number of calls, which might stall the process of enrolling and receiving payments.

Paid family leave

The new law expands the family leave provided in the Families First Coronavirus Response Act that President Trump signed into law on March 18. That bill covers workers in businesses with fewer than 500 employees. Those covered by the act can get up to 12 weeks of family leave (with the first two weeks unpaid) if they must stay home with children whose schools and day care centers have closed because of the pandemic.

The expansion allows individuals who were laid off on or after March 1 (but then rehired before the end of 2020) access to this family leave. Note: To be eligible for this leave, they need to have worked in that job 30-60 days before the initial layoff.

The benefit paid to individuals eligible for this family leave is two-thirds of pay, with a maximum of $200 per day or an aggregate $10,000 per worker. Employers cut the family leave checks and then get reimbursed by the federal government through the IRS.

Paid sick leave

Employees (both part time and full time) will get 80 hours of paid sick leave at full pay, capped at $511 per day or an aggregate $5,110 per worker, with part-timers receiving a proportionate number of hours. Individuals who are unable to work or telework because they are under medical quarantine or treatment for COVID-19, suspect they have the illness or are ordered to quarantine at home are eligible for the pay.

Additionally, individuals who are staying home to care for someone else who has COVID-19 or is suspected of having it, or who have a child whose school or day care is closed because of coronavirus, are eligible for two-thirds of pay capped at $200 per day, or an aggregate $2,000 per worker.

Stimulus checks

One much-anticipated provision of the final stimulus bill is the checks that will be sent to most Americans. These one-time payments will be sent to eligible individuals, which means anyone who is a legal resident, is not claimed (or eligible to be claimed) as a dependent on someone else’s tax return and doesn’t earn too much.

American adults will be granted the following one-time payments:

  • $1,200 payment to individual taxpayers
  • $2,400 payment for married couples filing jointly
  • An additional $500 per qualifying child under the age of 17

The payments start to phase out for single filers with adjusted gross income above $75,000; married couples filing jointly with AGI above $150,000; and heads of household (that’s a single person with dependents) with AGI above $112,500. Stimulus amounts will be paid out based on 2019 income (or 2018, if an individual hasn’t yet filed their 2019 tax return).

The bill also provides mortgage and renter relief, student loan relief and retirement plan changes.

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