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Biden Signs $1.9 Trillion COVID-19 Relief Bill Into Law

Posted on Mar. 12, 2021

President Biden signed the $1.9 trillion coronavirus relief package a day earlier than expected, clearing the way for stimulus payments to start showing up in Americans’ bank accounts.

“This historic legislation is about rebuilding the backbone of this country and giving people in this nation — working people and middle-class folks, the people who built the country — a fighting chance,” Biden said March 11 before signing the American Rescue Plan Act of 2021 (P.L. 117-2). He indicated that the bill has the support of a majority of Americans, despite not receiving a single Republican vote in Congress.

Democrats have spent the last week promoting the bill’s potential to boost the country’s economy and help combat the effects of the coronavirus. House Ways and Means Committee member Stephanie N. Murphy, D-Fla., said the package will help families most affected by the pandemic.

Murphy also praised efforts to further expand the employee retention credit, a measure she had worked on since its creation. The new law ensures that the ERC will be available to start-ups.

Perhaps the most immediate impact will be felt by those making less than $75,000 a year. White House press secretary Jen Psaki said Treasury will start distributing the $1,400 payments to qualifying individuals this weekend.

Families with children will benefit from the expanded child tax credit, which has been increased to $3,000 per child and $3,600 for those younger than 6. The benefits begin phasing out at incomes of $75,000 for single taxpayers and at $150,000 for joint-filing taxpayers. Individuals can claim the credit on a periodic basis instead of waiting until the end of the year to claim $300 a month per child from July through December.

To pay for expanding refundable credits such as the child tax credit and earned income tax credit, Democrats raised taxes in several areas. A one-year extension of the limitation on excess business losses of noncorporate taxpayers will raise $31 billion over the next 10 years, according to the Joint Committee on Taxation.

Repealing the worldwide interest allocation rules will raise another $22.3 billion from 2021 to 2031, and eliminating a deduction for public companies’ eight highest-paid employees will raise more than $7.8 billion over 10 years, the JCT estimates.

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