How the American Senate Rescue Plan differs from the House version

Senate Democrats passed their nearly $ 1.9 trillion version of the American Rescue Plan Act on Saturday afternoon, but not before making some major changes from the House of Representatives’ version of the bill last week.

Some of the most notable changes between the two aid projects include withdrawing a provision to gradually raise the minimum wage to $ 15 an hour and reducing the number of people who will qualify for a $ 1,400 stimulus payment.

The value of the improved federal unemployment insurance (SD) benefits has also been changed to appease Democratic Senator Joe Manchin of West Virginia, who has threatened not to support the bill. As in the House, no Republican legislator voted in favor of the legislation, saying it was unnecessary.

“This is not a pandemic rescue package,” Senate minority leader Mitch McConnell, RK.Y, said on Friday. “It is a parade of left-wing pet projects that are advancing during a pandemic.”

The bill maintains many of the progressive provisions in the House version and added a provision to make forgiveness of the approved student loan between December 31, 2020 and January 1, 2026 tax-free.

“Covid has affected almost every aspect of life,” said Senate majority leader Chuck Schumer, DN.Y., on Saturday. “The American Rescue Plan will provide more help to more people than anything the federal government has done in decades.”

Here are some of the main changes between versions of the bill for the House and Senate that could affect your portfolio.

As expected, the provision to gradually raise the minimum wage to $ 15 an hour was withdrawn from the Senate bill after the congressman, a non-partisan official who decides which bills qualify for approval in the upper house via reconciliation, determined the week passed that the provision did not meet the standards legislation must comply to be approved by simple majority.

It is unclear whether it would have been included anyway: Seven Democratic senators and Angus King, the Maine independent who joins the Democrats, voted against an amendment proposed by Vermont Senator Bernie Sanders, also an independent, to raise the minimum wage.

The project provides financing for a third economic impact payment, in the amount of up to $ 1,400 per individual and dependent.

Individuals who earn an adjusted gross income (AGI) of up to $ 75,000 (and couples who earn up to $ 150,000) are eligible for a total of $ 1,400 each, plus $ 1,400 for each dependent. In the Senate version, payments decrease much more quickly than in the House version: no individual with an AGI above $ 80,000 or couples who earn more than $ 160,000 will receive one. Heads of households who earn up to $ 112,500 will receive the full amount, and it will be completely eliminated by $ 120,000 for those filers.

In the previous version of the bill, payments were totally eliminated at $ 100,000 for individuals and $ 200,000 for couples. It is estimated that 12 million fewer adults will now qualify for a stimulus payment, compared to previous rounds.

Many Americans were upset by the decision to reduce the maximum income eligibility limit, calling it a “slap in the face” for middle-class Americans who were counting on the money and no longer qualified.

Payments are based on 2019 or 2020 revenue, depending on when the taxpayer submits his 2020 income tax return.

Unlike previous stimulus payments, adult dependents, including college students, adults with disabilities, and elderly Americans, can qualify for a $ 1,400 payment.

The Senate bill includes a clause to make any student loan forgiveness approved between December 31, 2020 and January 1, 2026 tax-free. Normally, debt forgiven is treated as taxable income.

The Senate bill does not include forgiving student debt directly, but it would make it easier for President Joe Biden to forgive $ 10,000 in student debt, as he said he would, by executive action, if Congress does not.

The Senate bill will extend the federal unemployment benefit supplement by $ 300 a week until September 6, and will make the first $ 10,200 IU received in 2020 non-taxable for families with an income of less than $ 150,000.

This differs from the House bill, which extended unemployment programs until August 29 and gave an extra $ 400 a week in benefits. It did not include the provision to make any of the benefits taxable.

The Chamber will now have to approve the changes before the bill is signed by the president.

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