$1,400 checks, and what else is in the COVID-19 relief package

President Biden’s $1.9 trillion COVID-19 relief bill could get a vote in the U.S. House by Wednesday and be signed into law by the end of the week.

The bill, which was sent back to the House after the Senate made changes provides the third, and what is expected to be the final round of direct stimulus payments, but with some changes to eligibility.

Under the plan taxpayers who make under $75,000 a year ($150,000 for married) would receive a $1,400 stimulus check for themselves and each dependent, even adult dependents.

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“It’s not just your kids, it is also your adult dependents, your elderly parents or grandparents,” said Adam Markowitz the Vice President of Markowitz Accounting.

But while the bill expands the number of people eligible, it does so by putting in hard caps on income. Under previous stimulus packages, income thresholds scaled down after $75,000 ($150,000 married). However, under this bill anyone making more than $80,000 ($160,000 married) will not qualify.

“There is a big cliff to this and you phase out pretty darn quick,” said Markowitz.

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While the $1,400 check may be the most broadly popular part of the bill, they are also the part that is causing the most concern on the part of economists.

“The biggest risk was sending out checks right now is that you basically end up overheating the economy as we come out of this situation, it is important to recognize the situation we are in right now as it relates to the pandemic is very different than it was last April or May ‚” said Jonathan Bydlak, the Director of Fiscal and Budget Policy for the R-Street Institute. “That’s not to say there aren’t still people who are hurting but right now we are transitioning from concern about the harm caused by the pandemic to concern of overheating as we come out of the pandemic.”

Bydlak said a smaller more narrowly tailored bill would have achieved many of the same goals without risking flooding the economy with cash.

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“One of the big problems is a lot of the aid is not being targeted to the things that are specifically related to the pandemic , things like vaccine distribution and testing are very small portions of these packages,” said Bydlak.

The bill also provides an extension to unemployment benefits of $300/week until September while simultaneously waiving federal income tax on the first $10,200 of unemployment. In addition the bill will change the child tax credit, increasing it from $2,000 to $3,600 for children 5 and younger and from $2,000 to $3,000 for children 6-17.

“This is a point of change in the way the United States government operates these policies and makes it easier for a lot of people with children up and down the income spectrum to raise children and have the sorts of families that they want,” said UCF Political Science Professor John Hanley.

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In addition, there is also $350 billion for states and local governments as well as $130 billion for schools. Of this, Florida is banking on about $8 billion, money the state will use to help balance its budget.

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