In the new $1.9 trillion American Rescue Plan Act signed on Thursday by President Joe Biden are far-reaching, rapid-impact economic benefits for Iowans.
The bill, which includes extended unemployment benefits, direct payment stimulus checks, increased child tax credits and earned income tax credits, along with local aid, among other provisions, is expected to financially boost the majority of the state in some way.
Vox called the relief bill the “most far-reaching anti-poverty legislation in more than 50 years.”
Here is what Iowans can expect to see:
The most visible, direct aspect of the relief bill is the $1,400 stimulus checks for most Iowans. The full checks will be sent to single people with incomes of up to $75,000 and couples making up to $150,000 will each see a payment.
$1,400 will be sent to each child dependent as well.
The checks will gradually lessen as income rises, capping at $80,000 for individuals and $160,000 for married couples based on 2019 or 2020 tax returns.
The rescue plan raises the maximum Child Tax Credit to $3,000 per child, or $3,600 for children under the age of 6, and extends the credit to 17-year-olds. It will make the full credit available to children in families with low or no earnings, which didn’t always qualify before.
The increase in the maximum amount will gradually decrease for heads of households making $112,500 and married couples making $150,000.
For Iowans without children, an Earned Income Tax Credit will raise from about $540 to about $1,500, and expand qualifications from about $16,000 to at least $21,000. Eligibility will also increase to include younger adults aged 19-24 who aren’t full-time students and those 65 and over.
Extended Unemployment Benefits
Congress in December passed a relief package set to expire in mid-March. The American Rescue Plan extends through Sept. 6 provisions like a federal unemployment benefits increase, more weeks of benefits and the Pandemic Unemployment Assistance Program, which expands benefit eligibility to more people. So an extra $300 a week in federal benefits will extend through the summer.
The bill includes a provision that makes the first $10,200 in unemployment benefits nontaxable for households making up to $150,000, an aspect of the bill that was put forth by Iowa Rep. Cindy Axne.
Also in the American Rescue Plan is a provision that makes student loan debt tax-free through 2025.
The 15% increase in Supplemental Nutrition Assistance Program (SNAP) benefits from December’s relief package will also extend through September.
The bill includes $170 billion for schools, $100 billion for public health, and $350 billion for state and local government aid.
by Isabella Murray
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