Senate Democrats passed their version of the US $ 1.9 trillion bailout bill on Saturday afternoon, but not before making some significant changes from the version of the bill passed by the House of Representatives last week. Deputies has been hired.
Some of the most notable changes between the two benefit accounts include scrapping a provision to gradually increase the minimum wage to $ 15 an hour and reducing the number of people eligible for a $ 1,400 incentive payment.
The value of federal benefits for improved unemployment insurance (UI) was also changed to appease moderate Democratic Senator Joe Manchin of West Virginia, who threatened not to back the bill. As in the House of Representatives, no Republican lawmakers voted in favor of the legislation, saying it was unnecessary.
“This is not a pandemic rescue package,” Mitch McConnell, RK.Y, Senate minority leader, said Friday. “It’s a parade of left-wing pet projects they ram through during a pandemic.”
The bill keeps many of the progressive provisions from the House version and added a provision to allow student loan waivers to be tax-free between December 31, 2020 and January 1, 2026.
“Covid has affected almost every aspect of life,” said Senate leader Chuck Schumer, DN.Y., Saturday. “The US bailout will help more people than anything the federal government has done in decades.”
Here are some of the major changes between the house and senate versions of the bill that could affect your wallet.
Minimum wage
As expected, the provision to gradually increase the minimum wage to $ 15 an hour was dropped from the Senate bill after the MP, an impartial official who decides which bills are eligible to pass through the upper chamber through reconciliation, determined last week that the provision was not satisfactory. the standards legislation must meet in order to succeed with a simple majority.
It’s not clear it would have been included anyway: Seven Democratic senators and Angus King, the Maine independent who consults with the Democrats, voted against an amendment proposed by Senator Bernie Sanders of Vermont, also an independent, to support it. minimum wage.
Stimulus Payments
The bill provides funding for a third payment for economic impact, worth up to $ 1,400 per person and dependent.
Individuals earning adjusted gross income (AGI) of up to $ 75,000 (and married couples earning up to $ 150,000) are eligible for the full $ 1,400 each, plus $ 1,400 for each dependent. In the Senate version, payments are phased out much faster than in the House version: no person with an AGI of more than $ 80,000 or couples making more than $ 160,000 will not receive one. Household heads earning up to $ 112,500 will receive the full amount, and it will run down completely at $ 120,000 for those stocks.
In the previous version of the bill, payments were completely phased out at $ 100,000 for individuals and $ 200,000 for couples. Compared to previous rounds, an estimated 12 million adults are now less eligible for an incentive payment.
Many Americans were upset by the move to lower the upper income threshold, calling it a “slap in the face” for middle-class Americans who counted on the money and were no longer eligible.
Payments are based on 2019 or 2020 income, depending on when a taxpayer submits their 2020 tax return.
Unlike previous incentive payments, adult dependents, including college students, disabled adults, and older Americans, may qualify for a payment of $ 1,400.
Student grants
The Senate bill includes a provision to exempt student loan forgiveness between December 31, 2020 and January 1, 2026. Usually forgiven debt is treated as taxable income.
The Senate bill does not directly include forgiveness of student debts, but it would make it easier for President Joe Biden to forgive $ 10,000 in student debt, as he has said he wants, through executive measures, if Congress does not. is doing.
Unemployment insurance
The Senate bill will extend the federal unemployment benefit allowance to $ 300 per week through Sept. 6, and make the first $ 10,200 in UI received in 2020 non-taxable to households with incomes less than $ 150,000.
That’s different from the House Bill, which extended unemployment programs until August 29 and brought in an additional $ 400 a week in benefits. It did not include the provision to make any of the benefits non-taxable.
The House will now have to sign the amendments before the bill can be signed by the president.
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