Thursday, March 26, 2020
Today, the Federal Government has agreed to a 2,000,000,000,000 (2 trillion!) stimulus package to keep our economy running during the pandemic. That’s a lot of zeros and it’s an unprecedented boost for small businesses during a time of economic crisis.
Here are the basics of what’s included in this stimulus package:
- Direct payments to Americans: Under the plan, individuals who earn $75,000 or less in adjusted gross income would get direct payments of $1,200 each, with married couples earning up to $150,000 receiving $2,400. An additional $500 per child will be tacked on to that. The payment would scale down as income rises, phasing out entirely at $99,000 for singles and $198,000 for couples without children. As of March 26 (the original date of this post), the Treasury Secretary stated that “payments could be out the door” within three weeks “if the treasury department knows where you live, and has your bank account information”, (e.g., you’ve already filed your 2019 taxes and received your refund via direct deposit), according to an MSNBC report.
- A significant expansion of unemployment benefits that would expand unemployment insurance by 13 weeks and include a four-month enhancement of benefits — an additional $600 per week – on top of what state unemployment programs pay. This program includes freelancers, furloughed employees, and gig workers, such as rideshare drivers.
- For small businesses that pledge not to let go of their workers, federally guaranteed loans will be available at community banks. These loans will be available during an emergency period ending June 30, carry a nominal interest rate of 4%, and be due in ten years — but any portion used to keep employees on staff or pay critical costs like rent or utilities would be forgiven.
- Loans for distressed companies would come from a $425 billion fund controlled by the Federal Reserve. An additional $75 billion will be available for industry-specific loans such as divisions of the travel industry.
- More than $150 billion will be dedicated to the healthcare system including funding for hospitals, research, treatment, and the gathering of ventilators, masks, and other necessary, life-saving equipment.
COVID Resources for Process Servers
Here’s what is being said about how this cash injection will benefit small business owners, their employees, and independent contractors.
Small Business Owner
The bill allocates more than $350 billion to aid small businesses across the nation. It also provides an incentive to keep on employees via loans so you can continue to meet your payroll and overhead commitments.
Full-time and Part-Time Employee
Individuals who earn $75,000 or less in adjusted gross income would get direct payments of $1,200 each, with married couples earning up to $150,000 receiving $2,400. An additional $500 per child will be tacked on to that. The payment would scale down as income rises, phasing out entirely at $99,000 for singles and $198,000 for couples without children.
For the first time, independent contractors, including those within the gig economy, will be covered by unemployment. This is great news for contract process servers, which make up a large majority of our industry.
Here are the breakdowns of the stimulus checks for “Average Americans” based on your 2019 tax returns. If you haven’t filed your 2019 returns, 2018 will be used.