The ultimate guide to understand the relief plan proposals that are on the table The ultimate guide to understand the relief plan proposals that are on the table

The ultimate guide to understand the relief plan proposals that are on the table

As the deadline approaches for Democrats and Republicans to agree on a new relief package, there are crucial matters in which both parties fail to iron out their differences. What does each proposal include?  

There are two proposals on the table: one for each party. The GOP's new stimulus package, the HEALS Act, is in full negotiation while the HEROES Act, which was passed in May by the House of Representatives, has not been retaken by the Senate.

Within both proposals, some points must be negotiated by politicians to reach an agreement and create new legislation. 

To understand the differences between them, here is a review of the most important points.

Total cost of the stimulus package

The CARES Act, which was passed on March 27 and whose benefits have ended or are ending in the next few weeks, cost $ 2.2 billion.

While the HEROES Act that was passed in the House of Representatives has a budget of $ 3 trillion, the HEALS Act contemplates a budget of only $ 1 trillion.

Stimulus check 

The maximum amount people were able to get during the first round of stimulus checks was $ 1,200 for a single person with less than an annual $ 75,000 income and a check for $ 2,400 for couples who collectively earn less $150,000 dollars a year. From that amount - and up to an annual gross income of $ 99,000 and $198.000 respectively- the amount will be progressively reduced $5 dollars for every $100 above the limit. 

In both the HEROES and the HEALS Acts, the stimulus check would have the same amount and the same income threshold.

The HEROES Act seeks to include the Spouses of immigrants with no social status, who file jointly and taxpayers who use an ITIN as beneficiaries of the direct payment.

Money and definition for economic dependents

The HEROES Act provides for a payment of $ 1,200 dollars for a maximum of three economic dependents and seeks to extend this definition to include the US-born children of immigrants without legal status married to an American citizen.

The HEALS Act establishes a payment of $ 500 dollars for all economic dependents regardless of age limit (but does not include children of mixed couples).

In the CARES Act, the payment was $ 500, and those under 16 years qualified as dependents, but university students 24 years old or younger were not eligible to receive the support. Neither were older people declared as dependents. Both proposals, therefore, increase the number of people who would qualify for financial aid.

Enhanced unemployment benefit

The HEROES Act provides for an unemployment bonus similar to the CARES Act, which included a bonus of $ 600 per week for applicants for unemployment insurance in addition to the benefits offered by each state. This benefit would continue until January 2021 for most workers and until March 2021 for contractors, freelancers and part-time workers.

The HEALS Act, meanwhile, would offer a starting bonus of $ 200 a week and then launch a program that provides $ 500 a week or 70% of lost wages, whichever is less.  The $ 200 weekly bonus would be delivered until September. Federal benefits of 70% compensation for lost wages would run through December 31, 2020.

It is important to note that the benefits of the CARES Act are no longer in effect and therefore millions of Americans are already without this vital lifeline until there is an agreement on this matter in Congress.

Federal eviction moratorium

The CARES Act prohibited non-payment surcharges until July 25 and evictions until August 24 on properties backed by federal mortgage programs that receive government funds.

The HEROES Act proposes to expand this protection to cover most rental properties in the United States. It would extend an eviction moratorium for an additional 12 months in addition to allocating $ 200 billion for housing programs and another $ 100 billion for rental assistance.

The proposal of the HEALS Law does not contemplate the aid for rent or moratorium

Payment Check Protection Program

The CARES law allocated a total of $ 659 billion in forgiven loans for small businesses that would need to use 74% of payroll to be eligible for credit forgiveness. Currently, $ 130,000 million remain but expire on August 8.

In the HEROES Act proposal, the program expands eligibility and eliminates the 75% payroll requirement and extends the application period until December 31.

The HEALS Act would inject $ 190 billion into the PPP fund, in addition to expanding eligibility and allowing companies a second loan. The proposal eliminates 75% of payroll requirements and expands the approved uses of funds for loan forgiveness.

Liability protection

The HEALS Act is the only legislation that covers this matter and would be offering a 5-year shield of responsibility to prevent schools, businesses and hospitals from being sued for matters related to the coronavirus.

Tax credit for employees

The CARES Law contemplated a tax credit on 50% of up to $ 10,000 in wages.

The HEROES Act would increase the tax credit to 80% by up to $ 15,000 in wages.

The HEALS Act would increase the tax credit to 65% of up to $ 30,000 dollars.

Bonuses for returning to work

HEALS could consider a return to work bonus of up to $ 450 per week for unemployed workers who get a new job or are rehired.

Neither the CARES Act nor the HEROES Act provides for a rehiring bonus.

Aid for reopening of schools

The HEROES Act proposes $ 58,000 million for basic education grades and $ 42,000 million for higher education.

The HEALS Act proposes $ 70 billion for basic and middle education for face-to-face classes, $ 29 billion for higher education, $ 1 billion for the Indian Office of Education, and $ 5 billion to be used on a discretionary basis by state.

This issue had not been contemplated in the CARES Act.

COVID-19 tests

Only the HEALS Law contemplates a budget of $ 16,000 million to conduct COVID-19 tests on the population.

Final thoughts

Within these differences, there are points that each party considers a priority to reach an agreement. In the case of Republicans, liability protection has been called a dealbreaker and Democrats have the $ 600 enhanced unemployment benefits at the top of their list.

With Congress close to leaving for the August break, lawmakers are on a time crunch to pass new legislation before next week. Otherwise, the debate would be resumed in September, leaving many Americans unprotected in many ways till then.

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