The Coronavirus Relief Bill: What Does it Mean for You?

A close-up, black and white picture of $100 bills
Pepi Stojanovski

To combat the unprecedented threat of the coronavirus, Congress took action last week. To lend a hand to struggling Americans and businesses, the Senate passed a $2.2 trillion relief bill that includes cash for most Americans, loans for big and small businesses, and grants for education, public health, and local government. For the sake of comparison, the 2009 economic stimulus package cost around $800 billion, a fraction of this year’s relief bill.

The Senate passed the CARES Act (Coronavirus Aid, Relief, and Economic Security) with a 96-0 vote, the House of Representatives ratified it, and President Trump signed it into law on Friday, March 28, 2020. After a few weeks of negotiations, politicians finally came to an agreement and set out to help the American people overcome this pandemic.

As you’d expect with a $2+ trillion bill, the CARES Act is complicated. Vast amounts of money are being moved around, and some of that will end up in the hands of average Americans. The full 880-page bill is dense and complex, but you don’t have to read all that. Here’s a look at what the stimulus package entails, and what it might mean for you.

CARES Act Overview

Roughly speaking, the biggest pieces of the CARES Act shake out like this:

  • $560 billion for individuals
  • $500 billion for big businesses
  • $377 billion for small businesses
  • $340 billion for local and state governments
  • $153 billion towards public health

The comprehensive bill will help businesses and industries that have been hit hard by the pandemic and lost revenue due to quarantine measures. One of the key components of the business relief was ensuring that companies could afford to keep paying their staff, even if income has been slashed in recent weeks.

Most small business relief will come in the form of emergency grants and forgivable loans. Big businesses have similar options, but the bill created oversight on how big corporations use federal money.

Local governments and health officials will also have more funds to combat the virus. About $100 billion will go directly to hospitals fighting coronavirus, and nearly $300 billion more will go to local governments in need of aid. While all these aspects are important, there are provisions that directly impact a majority of Americans.

How The Bill Impacts Individuals

First and foremost, every American adult who earns less than $75,000 per year will receive $1,200. Married couples making less than $150,000 will get $2,400, and families will get an extra $500 for every dependent child. Singles who make between $75,000-$99,000 will receive incrementally less from the government, and those making more than $99,000 (or $198,000 for couples) will not get any aid.

Your eligibility is based on your reported income from your 2018 or 2019 tax return, whichever you filed most recently. If you’ve already filed your 2019 return, your stimulus check will be based on that. If not, it’ll be based on the income you reported on your 2018 return, but if you didn’t file that year either you won’t be eligible for anything.

Some people that would have qualified for this stimulus based on their 2018 returns may not receive anything based on 2019, and vice versa. That, partly, is why it’s so difficult to pin down exactly how many Americans will get relief.

It’s not exactly clear when people will be getting their money, but it could vary greatly. Some Americans might get their stimulus in mid-April, but the White House indicated that it could take five months for every check to be sent. If you provided direct deposit information on your tax return, you’ll likely get your money before those who need paper checks. Still, the situation is developing and there’s no concrete timeline for when everyone will receive their aid.

If the IRS does not have your direct deposit info and you’d prefer to skip the wait for a paper check, the U.S. Treasury is developing a website where you can fill in that info. If you don’t typically file a tax return, say because you’re a senior citizen or retiree, you’ll still receive benefits, according to the IRS. 

Starting April 17th, you can check the status of your relief check through the IRS’s website. If you haven’t received your check yet, you can get an estimate for when it should hit your bank, or update your direct deposit and mailing info. Now that the government is getting checks out, they estimate that 60 million payments should be made by mid-April, and up to 5 million paper checks will be mailed weekly.

That alone is substantial, but it’s far from the only relief coming for Americans. On top of the $300 billion in cash aid to citizens, the CARES Act also includes more than $250 million for unemployment benefits. Millions of Americans are facing sudden unemployment as businesses shut down in response to coronavirus, so politicians felt they had to act to provide a greater social safety net.

The biggest change to unemployment is that the federal government is guaranteeing $600 per week on top of each state’s weekly check for four months. Each state pays a different amount, but the average American on employment receives about $372, meaning this federal aid will boost them to nearly $1,000 weekly. Moreover, unemployment benefits will last up to 39 weeks now, as opposed to the usual 26 weeks.

Additionally, all private insurers must cover the costs of COVID-19 tests and treatment. Gig and freelance workers who typically don’t get insurance from their employer will get health insurance aid from the federal government until the end of the year as well. Plus, the government extended the deadline to file taxes this year until June 15, 2020.

One potential blind spot for the CARES Act is college students who are still listed as dependents. Not only would any dependent over 18 not qualify for the stimulus check, full-time students often cannot get unemployment checks either. It remains to be seen if the government will extend further aid, but as of now certain vulnerable groups aren’t covered.

The Bottom Line

The coronavirus pandemic has reshaped American life in almost unthinkable ways, so the federal government had no choice but to take this kind of action. The CARES Act is the largest single spending package ever passed through Congress, and tens of millions of Americans will receive aid in the coming weeks as a result.

On top of the $560 billion directly earmarked for citizen’s relief, the remainder of the stimulus package will help keep business afloat and people employed. We’re stuck in uncertain times during the pandemic, but it’s clear that this bill is a major win for Americans.