The coronavirus pandemic continues to cause immense economic hardship for working families and businesses, and many are urgently awaiting financial help. Below is a guide to connect you with the basic information you’ll need to get through this, as well as details on government benefits and available services. The recently passed American Rescue Plan represents one of the largest federal efforts to provide direct relief and assistance to middle class and working families in the last half century.
American Rescue Plan Direct Stimulus Payments
Who will receive a payment:
- Individuals with an adjusted gross income of $80,000 or less ($160,000 for joint filers) are eligible for a one-time payment of up to $1,400, plus an additional $1,400 for each dependent child.
- Payments phase out for individuals earning $75,000 and will cut off completely for anyone who makes more than $80,000.
- For couples filing jointly, the phaseout starts for those making $150,000 and cuts off at $160,000.
- For those filing as head of household, the phaseout begins at $112,500 and cuts off at $120,000.
- Senior Citizens and disabled adults who are claimed as a dependent will receive a $1,400 check.
- Immigrants will qualify for a direct payment if they meet the eligibility criteria and have a valid Social Security number. Immigrants with green cards or H-1B and H-2A work visas are eligible for a $1,400 check. For mixed-status families, if one spouse is a U.S. citizen or a lawful permanent resident and the other spouse isn't, the family will still qualify for a direct payment as long as one of them has a Social Security number.
- Low income people who haven’t filed taxes in the past two years are eligible for a check, but it requires an extra step. The IRS is expected to announce an online portal for those individuals to register for a payment. Social security recipients will automatically get a relief check.
How you will receive a payment:
- The Treasury and IRS and working to ensure payments will go out this month and the IRS and Bureau of the Fiscal Service are working to increase the number of households that will get electronic payments rather than a check in the mail.
- If you have already filed your 2020 tax return, the IRS will use that information to determine the eligibility and size of your payments.
- If you have not yet filed your 2020 tax return, the IRS will review records from 2019 to determine eligibility and size of payments. This will include those who used the “non-filer portal” for previous rounds of payments.
- If your tax return has direct deposit or bank account information, the IRS will send you money electronically. For those households for which the Treasury cannot determine a bank account, paper checks or debit cards will be sent.
The American Rescue Plan overhauls the Child Tax Credit by expanding the benefit from $2,000 annually to as much as $3,600 per child. It also includes more low-income households and families will now receive the credit benefit through monthly cash payments.
Who will receive a Child Tax Credit:
- Families will receive a $3,000 annual benefit per child between ages 6 and 17 and $3,600 per child under 6.
- Parents making up to $75,000 a year and $150,000 for couples will receive the full tax credit.
- For families making more than $75,000 a year or $150,000 combined, the credit will be reduced by $50 for every additional $1,000 of adjusted gross income earned. This means, for example, that if you are making $95,000 or $170,000 combined, your credit will be phased out. You can find how much your family will receive using this Child Tax Credit Calculator
When you will receive a Child Tax Credit payment:
- The IRS will begin providing advances of the 2021 credit through periodic payments of $250 for school-aged children starting July 2021.
- Under the current proposed schedule, which could be as frequent as monthly, families would receive half of their total 2021 child tax return this year and claim the remaining amount on their 2021 tax returns.
Additional guidance regarding your Child Tax Credit:
- You do not need to be employed to claim the Child Tax Credit.
- The Child Tax Credit is fully refundable, if your credit exceeds your taxes owed, you may receive the full $3,000 or $3,600 refund, depending on your child's age.
- The legislation passed is only a temporary increase. Democrats have vowed to push Congress to make the increased tax credit permanent due to its widespread support of its ability to cut the child poverty rate in half.
In Maryland anyone who has lost a job, been furloughed or forced to stay home due social distancing orders can file for unemployment. People who have been ordered to isolate or had to leave their jobs to avoid exposure or to care for an infected family member, are also eligible.
You can immediately file an unemployment claim online through the state labor department website or by phone. The state is waiving the work search requirements during the pandemic.
New Unemployment Benefits Under the American Rescue Plan
With the passage of the American Rescue Plan, individuals will receive $300 per week in federal payments in addition to unemployment benefits received from the state. There are two main unemployment programs that were created during the pandemic:
Pandemic Unemployment Assistance (PUA) - for gig worker and those not traditionally eligible for unemployment.
Pandemic Emergency Unemployment Compensation (PEUC) - for long-term unemployed individuals.
Through this new extension, the PUA and PEUC programs have been extended through September 6, 2021. The maximum number of weeks you can draw from PUA is 79 weeks, the maximum amount of time you can collect PEUC benefits increases to a total of 53 total weeks.
Additionally, workers who lost a W-2 job and earned at least $5,000 in self-employment income in their most recent tax year are eligible for an extra $100 per week as part of the Mixed Earner Unemployment provision.
Tax Filing, Waivers and Provisions Under the American Rescue Plan
A new provision in the American Rescue Plan waives federal taxes on the first $10,200 of unemployment benefits that were received in 2020.
Married couples who file jointly and both collected unemployment insurance benefits in 2020 will have taxes waived on $10,200 per person
This waiver only applies to individuals and married couples who made less than $150,000 in adjusted gross income in 2020.
If you have not yet filed your 2020 taxes, we are awaiting formal guidance from the Internal Revenue Service. If your return has been processed and you’ve received a refund, you’ll likely have to file an amended tax return in order to claim the $10,200 exemption.
Please note that if you have already filed your return but it has not yet been processed by the IRS, there may be a delay, especially if you were expecting a refund.
If you already withheld or paid taxes on your unemployment benefits throughout the year, you may now be entitled to a refund.
Remember, even if workers experience a lapse in their unemployment payments, they are still entitled to their benefits and can expect to receive their aid retroactively.
Paid Sick and Family Leave
Most workers at small and medium-sized businesses, can get paid leave as long as they’ve been employed for at least 30 days.
These workers can get two weeks of paid sick leave if they are ill or quarantined, or if they are caring for sick family members. They can get 12 weeks of paid leave to care for children whose schools or childcare are closed.
Part-time workers will be paid the amount they typically earn in a two-week period. Self-employed workers can receive paid leave by claiming a tax credit based on their average daily income.
Here in Maryland, companies with 15 employees or more have to offer 40 hours of paid sick leave per year.
More information is available from the U.S. Department of Labor, including a fact sheet for workers and a page answering questions for employers and employees.
Assistance for Students and Educators
Since the beginning of the COVID-19 pandemic educators, parents and students quickly adapted to an unprecedented remote learning environment. Teachers have put in long hours to ensure students don't fall further behind and schools have offered support to families that stretches well beyond the classroom.
Now, a year into this pandemic officials can say with confidence that help is on the way. The Biden Administration has directed $10 billion from the American Rescue Package be directed toward Covid-19 testing and schools in addition to $130 billion for K-12 education and other provisions that will impact our students. We are well on our way to getting students back into schools and continuing the education they need to build a brighter future.
Assistance with Food Insecurity
Investments in K-12 Education
The American Rescue Package includes close to $130 billion in K-12 education, prioritizing low-income school districts. Maryland has received $1.9 billion to invest in our K-12 students.
School districts will have control over how to spend these funds, but some investments they can use through the funding include:
Mental health services
Summer or after-school programs
School building improvements that “reduce risk of virus transmission and exposure to environmental health hazards”
Implementation of public health guidance
“Other activities that are necessary to maintain the operation of and continuity of services ... and continuing to employ existing staff.”
“Activities to address the unique needs of low-income children or students, children with disabilities, English learners, racial and ethnic minorities, students experiencing homelessness, and foster care youth.”
Local Reopening Plans
Prince George’s County Public Schools have taken steps to conduct Covid-19 testing, new social distancing and facial covering guidelines, and have enacted new classroom configurations to adhere to CDC guidelines. In April, they will implement a hybrid learning schedule, where students can split their time between in-person and remote learning, and that families may opt into. Please read through the PGCPS reopening plan for further information.
Anne Arundel County Public Schools are offering both virtual and hybrid learning options for Spring 2021, in addition to constructing new classroom configurations for in-person students and now require daily symptom screenings before sending students to school. For additional information on their virtual and hybrid learning models, please visit AACPS roadmap to reopening plan.
No Student Gets Left Behind
Districts must use at least 20% of the money to address learning loss. This could show up as a summer learning or summer enrichment extended day, an afterschool program, or extended school year programs.
In addition to the direct money to schools, the American Rescue Package includes $7 billion to create an Emergency Connectivity Fund through a program known as E-Rate, which subsidizes internet access for schools and libraries. Schools that participate in the program can use the new money to help students and teachers access the internet at home, such as:
Investments in Higher Education
Of the nearly $40 billion committed to higher education, 90% has been allocated to public and private nonprofit institutions in the form of direct grants; including 7.5% of the funds to programs for minority serving institutions such as HBCUs and tribal colleges. Maryland has received $550 million to invest in higher education and these funds will be used to make up for lost revenue due to the pandemic.
Even more, the American Rescue Plan requires at least half of this funding be used for emergency financial aid grants to students to help prevent hunger, homelessness and other hardships facing our students as a result of the pandemic.
Additionally, the American Rescue Plan will allow for future student loan forgiveness between December 2020 and January 2026 not taxable income.
In addition to housing assistance, the American Rescue Plan directly answers the call to strengthen our food assistance programs. By making key investments in SNAP, WIC, Pandemic EBT and other critical nutrition assistance, we will ensure that no family experiences hunger as we continue to battle this pandemic.
The American Rescue Plan helps combat increasing food insecurity by making key investments in SNAP, WIC, Pandemic EBT and other critical nutrition assistance. Additional assistance includes:
Assistance with Utilities
Extending SNAP maximum benefits by 15 percent (through September 30, 2021);
Providing $1.1 billion in additional SNAP administrative funds to states to help meet the demand of increased caseloads and $25 million to improve the state SNAP online pilots
Allocating $800 million for WIC – supporting low-income women and infants – and temporarily boosts the value of WIC Cash Value Vouchers for vulnerable mothers and their children.
Secures $37 million to cover food shortfalls in the Commodity Supplemental Food Program which seeks to improve the health and nutrition of low-income Americans over 60 years old through access to nutritious food.
In addition to those critical nutrition assistance programs, the American Rescue Plan maintains and expands the Pandemic-EBT program, investing $5 billion in Pandemic-EBT so that low-income have access to school meals and food assistance during both the school year and summer months.
Lastly, the American Rescue Plan expands access to the USDA’s Child and Adult Care Food Program (CACFP): this bill temporarily expands the age of eligibility for CACFP at emergency homeless shelters to ensure more young adults can access needed nutrition support.
A number of large telecommunication companies have agreed not to terminate residential or small business customers who can’t pay their bills: AT&T, Comcast, Cox, RCN, Sprint, T-Mobile and Verizon. A full list is available at the Federal Communications Commission. Low-income households may be eligible to receive service for free.
BGE and Pepco are suspending service disconnections and waiving late payment fees until at least May 1.
Washington Gas will not be disconnecting customers or charging late fees.
WSSC has suspended water shut-offs and waived late fees for those who have trouble paying.
Getting Health Insurance
If you lost your job or are working reduced hours, you may qualify for Medicaid and can apply online through the Maryland Health Connection. Individual health benefit plan policies that were scheduled to terminate because of unpaid premiums on or after July 31, 2020, will remain in effect through September 30, 2020.