Stimulus Round 2: Government to Send $600 To Most US Residents; $300 Unemployment Supplement; PPP Funding & More

(Update 12/27/20: The bill has now been passed after being signed into law by the president.)

(Reposting 12/23/20: I’ve updated various parts of this post over the past days. Also added a link to a calculator to calculate your check. Deposits could be seen in a matter of days.)

The US Senate and House have agreed to a bipartisan $900 billion stimulus deal which is expected to become law. The bill sends $600 deposits to most US residents, supplements state Unemployment benefit by adding $300/week, adds new funding to the PPP loan program, and more.

This new stimulus bill follows the major $2 trillion stimulus sent out earlier this year which with $1,200 checks to most US residents, $600/week in unemployment, PPP loans and more.

Read the bill here (pdf)

Contents

1 $600 Checks
2 $300 Unemployment
3 PPP Funding
4 Other
5 Previous Posts

$600 Checks

The highlight is again the $600 deposits/checks which will be sent out to most US residents. Parents will also get $600 per child, so a family of 4 would end up with a $2,400 check. The $600 figure is half of the $1,200 sent out in the first stimulus, though the child benefit is slightly higher at $600 versus $500 in the first round.

Those who earn less than $75,000 get the full $600. For a couple filing jointly it’s $150,000 and for a head-of-household it’s $112,500.
Those who earn more than $99,000 per year ($198,000 for a couple) who will not get anything. “Income” is defined as AGI, adjusted gross income. There’s a phase out from $75,000 – $99,999 where you’ll get a smaller check. Those without children are completely phased out at just $87,000.
Here’s a calculator to figure out how much you’ll earn.
This check is not taxable, you keep all of it; you won’t have to pay taxes on it at the end of the year like you do on other income.
Green card holders/permanent residents (“resident aliens”) will receive the stimulus checks.
See additional details in our post on the first stimulus bill.

Last time around, some people had issues with their bank accounts not being on file with the IRS, and thus a longer wait time until getting physically mailed checks. Hopefully by now you have your bank in their system, if not, you’ll get it in the mail similar to the first time.

$300 Unemployment

The bill supplements the regular state unemployment insurance (UI) by $300 per week. (That’s half the amount of the first stimulus bill.) For example, in California the UI benefit maxes out at $450/week for high earners. Now, you’ll get $750/week with the added $300 from the feds. Also important: the bill offers the $300/week of unemployment even to those workers whose regular benefits have expired – they’ll still be able to get the $300.

The benefit is slated to be in place for 11 weeks from December 28 through March 14. Gig workers will also be able to get this 11 week benefit, just as was the case for the first stimulus round.

You can see our (incomplete) analysis of the Unemployment benefit from the first round in this post.

PPP Funding

The bill revives the lapsed Payroll Protection Program (PPP) which offers loans to small business, including some criteria which allows the loan to be forgiven. With another $284B in funding, more businesses can borrow and get loan forgiveness.

The bill also allows for businesses who already got PPP loan to get a second one (“second draw loan”), though only those who can show drops in revenue of 25%+ are eligible for another round. The second draw is forgivable as well.

An interesting thing settled in this bill is that loans forgiven under PPP (either round) will allow the costs covered by the forgiven loan to be deducted on their tax returns. Seems strange to me, but certainly a nice additional benefit from the PPP forgiveness.

They also added an easy 1-page simplified forgiveness application for loans less than $150,000.

You can see more details on the PPP program in this post from the first stimulus round.

Other

$45 billion for transportation aid, including $15 billion to airlines, $14 billion for transit systems, $10 billion for highways, $2 billion for airports, $1 billion for airline contractors and $1 billion for Amtrak
Extends the moratorium on evictions through January 2021; previously this had been slated to end after December
$25B in unspecified renters assistance
Business meal expenses in 2021 and 2022 are now deductible; this is done to help revive the restaurant industry
Extends the time states and cities have to use CARES Act funds through the end of 2021 (previously they had to use it by the end of 2020)
Bills gives billions of dollars toward vaccine distribution and other health measures
Gives $13B in increased SNAP benefits
Gives $82B for schools and colleges
Gives $7B toward helping certain areas with broadband access
A certain tax credit for employers who offer paid sick leave
$10B toward child care assistance
$20B in EIDL Grants for small businesses (unclear if they’ll have the $1,000 grant offer this time)
$10B for USPS