On March 27, a $2 trillion, bipartisan stimulus bill was signed by the president to help millions of Americans stay afloat during the coronavirus pandemic. Its components include stimulus payments to individuals, expanded unemployment coverage, student loan changes, different retirement account rules and more.
Under the Pandemic Unemployment Assistance, included in the stimulus bill, Independent Contractors – which includes FHV drivers and “gig” workers – can receive half the average unemployment benefit in their state, plus an additional $600 per week.
The new assistance program was created to help qualify self-employed workers unable to file for regular unemployment insurance.
The following are excerpts from a New York Times column, titled: “F.A.Q. on Stimulus Checks, Unemployment and the Coronavirus Plan.”
How large will the stimulus payments be? Most adults will get $1,200, although some will get less. For every qualifying child age 16 or under, the payment will be an additional $500. This will be a one-time payment. Future bills will need to be written for additional payments.
You DO NOT need to apply to receive your payment, if the Internal Revenue Service already has your bank account information. It will transfer the money to you via direct deposit based on the recent income-tax figures it already has.
Treasury Secretary Steven Mnuchin said he expects most people to get their payments within three weeks.
To ensure you get your money and that the check didn’t “get lost in the mail,” a paper notice will be mailed out no later than a few weeks after your payment has been disbursed. That notice will contain information about where the payment ended up and in what form it was made. If you can’t locate the payment at that point, contact the IRS using the information on the notice.
How do I know if I will get the full amount? Single adults with Social Security numbers who have an adjusted gross income of $75,000 or less will get the full amount. Married couples with no children earning $150,000 or less will receive a total of $2,400. Taxpayers filing as head of household get the full payment if they earned $112,500 or less. Above those income figures, the payment decreases until it stops altogether for single people earning $99,000 or married people who have no children and earn $198,000. A family with two children will no longer be eligible for any payments if its income surpassed $218,000.
You can’t get a payment if someone claims you as a dependent, even if you’re an adult. In any given family and in most instances, everyone must have a valid Social Security number in order to be eligible. There is an exception for members of the military.
Do college students get anything? How about Veterans and people receiving Social Security retirement and disability payments?
College students do not get a check if anyone claims them as a dependent on a tax return. Usually, students under age 24 are dependents in the eyes of the IRS if a parent pays for at least half of their expenses.
People who receive Social Security retirement and disability payments will get a stimulus payment, as will eligible unemployed people and veterans.
Even U.S. citizens living abroad will get a payment, as long as they meet the income requirements and have a Social Security number.
What year’s income should I be looking at? 2019. If you haven’t prepared a tax return yet, you can use your 2018 return. If you haven’t filed that yet, you can use a 2019 Social Security statement showing your income to see what an employer reported to the IRS.
If you haven’t filed tax returns recently, it could complicate your ability to get a stimulus check. It is advised that you file a return immediately, at least for 2018, according to the I.R.S. website. “Those without 2018 tax filings on record could potentially affect mailings of stimulus checks,” the site says.
If you’re worried about money that you owe that you cannot pay, the IRS recommends consulting a tax professional who can help you request an alternative payment plan or some other resolution.
What if my recent income made me ineligible, but I anticipate being eligible because of a loss of income in 2020? The plan does not help people in that circumstance currently, but you may benefit once you file your 2020 taxes. The payment is technically an advance on a tax credit, available for the entire year. So, it will depend on how much you earn. You may also be able to file for unemployment or for one of the new loans for small business owners or sole proprietors.
Who will be eligible for Unemployment Benefits? The expanded program includes far more workers than are usually eligible for unemployment benefits, including self-employed people and part-time workers.
Independent contractors, “gig” workers and freelancers WILL be covered. Self-employed workers will also be eligible for the additional $600 weekly benefit provided by the federal government.
Those who are unemployed, are partly unemployed or cannot work for a wide variety of coronavirus-related reasons will be more likely to receive benefits. How much you will receive depends on the state you live in.
You are also eligible if your employer shut down your workplace because of coronavirus. If you are unemployed, partly unemployed or unable to work because your employer closed down, you’re covered.
The average worker earns about $1,000 a week, and unemployment benefits often replace roughly 40 to 45% of that. The expansion will pay an extra amount to fill the gap. Under the plan, eligible workers will get an extra $600 per week on top of their state benefit. But some states are more generous than others. According to the Century Foundation, the maximum weekly benefit in Alabama is $275, but it’s $450 in California and $713 in New Jersey.
If a worker was making $1,100 per week in New York, they would be eligible for the maximum state unemployment benefit of $504 per week. Under the new expansion, they would get an additional $600 of federal pandemic unemployment compensation, essentially replacing the original paycheck.
What if I’m a part-time worker who lost my job because of a coronavirus reason, but my state doesn’t cover part-time workers? Am I still eligible? Yes. Part-time workers are eligible for benefits, but the benefit amount and how long benefits will last depend on your state. They are also eligible for the additional $600 weekly benefit.
What if I have Covid-19 or need to care for a family member who has it? If you’ve received a diagnosis, are experiencing symptoms or are seeking a diagnosis – and you’re unemployed, partly unemployed or cannot work as a result – you will be covered. The same goes if you must care for a member of your family or household who has received a diagnosis.
What if my child’s school or day care shut down? If you rely on a school, a day care or another facility to care for a child, elderly parent or another household member so that you can work — and that facility has been shut down because of coronavirus — you are eligible.
What if I’ve been advised by a health care provider to quarantine myself because of exposure to coronavirus? And what about broader orders to stay home? People who must self-quarantine are covered. The legislation also says that individuals who are unable to get to work because of a quarantine imposed as a result of the outbreak are eligible.
How long will the unemployment payments last? Many states already provide 26 weeks of benefits, though some states have trimmed that back while others provide a sliding scale tied to unemployment levels. The bill provides all eligible workers with an additional 13 weeks. So, participants in states with 26 weeks would be eligible for a total of 39 weeks. The total amount cannot exceed 39 weeks, but it may be shorter in certain states.
The extra $600 payment will last for up to four months, covering weeks of unemployment ending July 31.
How long would the broader program last? Expanded coverage would be available to workers who were newly eligible for unemployment benefits for weeks starting on Jan. 27, 2020, and through Dec. 31, 2020.
Will I receive help if I’m already receiving unemployment benefits? Yes. Even if you’re already receiving unemployment benefits for reasons unrelated to the coronavirus, your state-level benefits will still be extended by 13 weeks. You will also receive the extra $600 weekly benefit from the federal government.
If you’ve already exhausted your benefits, eligible workers can generally reapply. How much you get and for how long depends on the state where you worked. Everyone gets at least another 13 weeks, along with the extra $600 payment.
How long will I need to wait for benefits? States have been incentivized to waive the one-week waiting period, but it’s unclear how long it will take to process claims – especially with state offices so strained by a flood of them.
How does the aid for small businesses and nonprofits work? Good news here, as you may be eligible for forgivable loans.
Is there any relief for renters in the bill? Yes. The bill puts a temporary, nationwide eviction moratorium in place for any renters whose landlords have mortgages backed or owned by Fannie Mae, Freddie Mac and other federal entities. This will last for 120 days after the bill passes, and landlords also can’t charge any fees or penalties for nonpayment of rent.
A few additional facts:
- You do not pay income taxes on the stimulus payment.
- Even if your income tax refunds are currently being garnished because of a student loan default, this payment will not be garnished.
- The bill temporarily suspends nearly all efforts to garnish tax refunds to repay debts, including those to the IRS itself. But this waiver may not apply to people who are behind on child support.
- The bill excludes workers who are able to work from home, and those receiving paid sick leave or paid family leave. New entrants to the work force who cannot find jobs are also ineligible.
- Your credit score is not supposed to be affected if you take advantage of any virus-related payment relief, including a student loan suspension.
- Internet service providers can still cut off your service for non-payment. It is also not illegal for utility providers to cut off your service for non-payment.
Additional information– including details about student loans, retirement accounts and charitable contributions – is available in the original New York Times article, which can be viewed here: https://www.nytimes.com/article/coronavirus-stimulus-package-questions-answers.html.