As was expected, the Senate Republicans formally introduced their coronavirus stimulus proposal on Monday. The GOP’s roughly $1 trillion coronavirus stimulus check proposal, called the HEALS Act (Health, Economic Assistance, Liability Protection and Schools), included everything that was expected.
Coronavirus stimulus checks under HEALS Act
GOP’s HEALS Act proposed stimulus checks of $1,200. The proposed eligibility requirements are the same as the first round. This should come as a relief as there were speculations that the Senate could go for an income cap of $40,000.
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“The American people need more help," Senate Majority Leader Mitch McConnell said. "The pandemic is not finished. The economic pain is not finished. So Congress cannot be finished either."
As per the memo from the Senate Finance Committee, those earning an adjusted gross income of up to $75,000 per year in 2019 (couples earning $150,000) would get a check of $1,200 ($2,400 for couples). The amount would be reduced by $5 for every $100 in income. Those earning $99,000 or more ($198,000 for couples) wouldn’t be eligible for the checks.
The HEALS Act also proposes unemployment benefits, but of a lesser amount than what was given under the CARES Act. As per the HEALS Act, the unemployment insurance would be $200 per week through September 2020.
HEALS Act: What else does it propose?
GOP’s next coronavirus stimulus bill, the HEALS Act, also proposes to expand the Paycheck Protection Program (PPP). The bill proposed $190 billion to support second draw loans from the PPP. This fund would be limited to firms with less than 300 employees that have witnessed at least a 50% drop in gross revenues.
Qualifying firms would be allowed to apply for funds equaling 2.5 times their monthly payroll costs up to $2 million. Further, these loans would be forgivable if a company uses at least 60% of the amount to pay salaries.
The HEALS Act also raises the employee retention tax credit (ERTC), which is currently at 50%. ERTC is a refundable payroll tax credit for some of the wages that employers pay during the crisis. This new proposal raises the tax credit from 50% to 65%, while the gross receipts threshold to qualify for the credit is reduced from 50% to 25%.
Further, the total wages on which ERTC can be claimed is increased from $10,000 per year to $30,000 per year, with a limit of $10,000 per quarter. Another provision for employers in the HEALS Act is the expansion of the Work Opportunity Tax Credit (WOTC) to employers who hire in qualified groups, including qualified COVID-19 unemployment recipients.
As was expected, liability protection to health-care providers, schools, and employers is also proposed by the HEALS Act. Further, the bill also sets aside $306 billion for coronavirus health response. This includes $105 billion to help students return to school in the fall.