The House Rules Committee has announced that on Friday it will hold a hearing on the COVID-19 “rescue” bill.
This Committee is tasked with creating the instructions for how (and how long) legislation is debated on the House floor. Passage of the bill from the committee is expected.
After passage, the bill later Friday will be debated on the House floor, according to House Majority Leader Steny Hoyer (D-Md.). It is not clear when House lawmakers will vote on the bill, but more than likely that vote will occur on Friday. Passage is expected.
The legislation that the House Rules Committee will debate on Friday will include the tax provisions that the House Ways and Means Committee approved on February 11, 2021. There have been some technical changes to the bill so that it conforms to the tax code.
There has been one notable change regarding the tax credits for paid sick and family leave, which are included in the rescue package.
The tax credit can apply to employees who take off from work because they are “seeking or awaiting the results of a diagnostic test for, or a medical diagnosis of, COVID-19,” according to the legislative text. This activity did not qualify for the credit in prior bills.
The legislation is making its way through Congress under special protections called “reconciliation.” One of those protections is that the legislation can add $1.9 trillion to the deficit over ten years. However, currently it is “costing” $67 billion more than that figure.
Lawmaker must offset this cost by either modifying the spending or tax provisions that are in the bill or add tax increases to the legislation. Without adjustments, the rescue package losses its reconciliation protections, which is essential for passage in the Senate.
Under reconciliation protections, Senate passage requires a simple majority of support. Without these protections, the rescue package would need 60 votes, which would require all Senate Democrats and ten Senate Republicans to support the bill. It is highly unlikely that ten Senate Republicans will vote for the rescue plan.
Below are some of the provisions that the House Ways and Means Committee approved for the rescue plan:
- A $1,400 refundable tax credit for each family member, which shall be paid out in advance payments. The credit phases out between $75,000 and $100,00 of adjusted gross income ($112,500 and $150,000 for head of household filers and $150,000 and $200,000 for joint filers) based on information on 2019 or 2020 tax returns. Extending the Employee Retention Credit from July 1, 2021, to January 1, 2022.
- Extending temporary federal unemployment and benefits through August 29, 2021, and increasing the weekly enhanced benefit from $300 to $400.
- Expanding the Child Tax Credit to $3,000 per child 17 years old and under ($3,600 for children under 6) and makes it fully refundable and advanceable.
- Expanding the Child and Dependent Tax Credit to allow families to claim up to half of their childcare expenses.
- Enhancing the Earned Income Tax Credit for workers without children by nearly tripling the maximum credit and extending eligibility.
- Reducing health care premiums for low- and middle-income families by increasing the Affordable Care Act’s (ACA) premium tax credits for 2021 and 2022.
- Excluding amounts received from the Administrator of the Small Business Administration in the form of a Restaurant Revitalization Grant from gross income.
The House Ways and Means Committee’s section-by-section summary of its provisions can be found here.