The American Rescue Plan

President Joseph R. Biden Jr. was sworn in as the 46^th President of the United States on Wednesday, January 20, 2021. But his planning and work as POTUS began long before that. Before his Inauguration, Biden proposed the American Rescue Plan, a $1.9 trillion relief program designed to help fight against the COVID-19 pandemic and the resulting economic crisis in our country. The main goals of the plan are to direct money into the United States economy and to support further COVID testing and vaccination endeavors. Here are some of the provisions that may be applicable to you and those you know:

• Additional Stimulus Checks
  • The plan would provide an additional $1,400 stimulus check per person (which brings the total, including the $600 Appropriations Act stimulus checks in process now, to $2,000 per person).
  • The checks will still only be payable to those with income below certain thresholds but will expand those eligible to include adult dependents.
• Unemployment Benefits
  • The additional weekly benefit of $300, currently extended for 11 additional weeks through mid-March, would be increased to $400 per week and extended through the end of September 2021.
  • Pandemic Unemployment Assistance (PUA), which provides unemployment benefits to those usually not eligible (like self-employed individuals), would also be extended through the end of September 2021.
• Tax Credits
  • Child and Dependent Care Credit
    • The plan proposes an increase of the Child and Dependent Care Credit for 50% qualifying childcare expenses up to $4,000 per child, with a maximum of $8,000 for families with two or more children, for the 2021 tax year (up from the current $3,000/$6,000). The credit would be fully refundable (currently not refundable) for 2021, and would be subject to phaseouts above certain income thresholds.
  • Child Tax Credit
    • Biden’s plan also proposes increasing the Child Tax Credit to $3,600 per child under 6, and $3,000 per child between 6-17 for the 2021 tax year (up from $2,000 per child 16 or younger).
    • This credit would also be fully refundable for 2021 (an increase from the current stipulations that up to $1,400 per qualifying child is refundable).
  • Earned Income Tax Credit
    • Biden’s proposal would increase the maximum credit amount for childless adult taxpayers in 2021 to $1,500 and would increase the income limit for these taxpayers to $21,000.
    • Additionally, this proposal would eliminate the age cap to allow older workers to claim this credit for 2021, too.

The proposed plan also provides $20 billion to help offer free COVID vaccinations to all U.S. residents and $50 billion to increase access to COVID testing around the country, as well as funding to help reopen schools safely. The minimum wage would be increased to $15 per hour and paid sick/family/medical leave would again be mandated for many employers and expanded to include federal workers. Additional healthcare coverage support is included in the form of subsidized COBRA premiums and increased Premium Assistance Tax Credits for Affordable Care Act plans. Also included is an extension of the current moratorium on evictions and foreclosures through September 2021, plus $25 billion earmarked for rent assistance, and $5 billion earmarked for utility bill assistance.

It is important to note this was Biden’s initial proposal. There are sure to be negotiations and revisions as this bill passes through Congress, and it may be broken up into different pieces of legislation. We will continue to monitor for updates and share more if/when the next round of stimulus is signed into law. Please don’t hesitate to reach out with questions in the meantime.