How the Coronavirus Relief Bills Affect You

Government assistance for COVID-19 all began with the passage of the $8.3 billion Coronavirus Preparedness and Response Supplemental Appropriations Act, 2020, enacted into law on March 6, 2020. The $192 billion Families First Coronavirus Response Act came next, on March 18, 2020.

With the passage and signing of the Coronavirus Aid, Relief, and Economic Security (CARES) Act into law on March 27, 2020, Congress and then-President Donald Trump set into motion a massive $2.2 trillion COVID-19 relief bill and the largest single economic rescue plan in U.S. history.

An interim funding bill, (known as the Paycheck Protection Program and Health Care Enhancement Act) added $484 billion to that total. Then, in December 2020, the Consolidated Appropriations Act, 2021 was passed, adding another $900 billion in economic relief amid the ongoing fallout from the COVID-19 pandemic.

Biden Adds to Relief

On Jan. 20, 2021, his first day in office, President Joe Biden signed 17 executive actions, including one that extended the student loan payment and interest relief, and another that extended the moratorium on foreclosures and evictions.

On Feb. 16, 2021, the Biden administration announced that it was extending COVID-19 forbearance and foreclosure protections for homeowners again, through June 30, 2021. The forbearance protections were extended again through Sept. 30, 2021, following an announcement from the Federal Housing Finance Agency (FHFA).

The $1.9 trillion American Rescue Plan Act of 2021 was signed into law on March 11, 2021, bringing the total of all COVID-19 relief bills to nearly $5.7 trillion.

On Aug. 3, 2021, the CDC issued a new targeted eviction moratorium for areas of high or substantial COVID-19 transmission rates effective through Oct. 3, 2021, previously set to expire on July 31, 2021. However, on Aug. 26, 2021, the Supreme Court vacated the CDC order, effectively ending the CDC eviction moratorium.

On July 28, 2021, the FHFA announced protections for tenants of multifamily properties with loans backed by Fannie Mae or Freddie Mac. Regardless of whether the loan is in forbearance, landlords must give tenants a notice of 30 days before being forced to leave.

At this point, you likely wonder how much of this and previous coronavirus legislation applies to you and your financial well-being. It turns out that these laws impact millions of Americans in a variety of ways. Read on to see where you fit in.

Phases 1, 2, 3, 3.5, 4, and 5

There are five main parts to COVID-19 legislation. The Paycheck Protection Program (PPP) and Health Care Enhancement Act (lawmakers consider it “Phase 3.5”) didn’t create a new policy but refreshed funding for parts of Phase 3 that lapsed or slowed down when the money ran out. The Consolidated Appropriations Act, 2021, passed into law at the end of 2020, also refreshed funding but expanded parts of Phase 3 that had expired or were in danger of expiring. The American Rescue Plan Act of 2021 is the latest legislation and one of the most ambitious.

Phase 1, H.R. 6074, the Coronavirus Preparedness and Response Supplemental Appropriations Act, 2020, was enacted into law on March 6, 2020, and provided $8.3 billion in emergency funding for federal agencies to ensure that vaccines developed to fight the coronavirus are affordable, that impacted small businesses can qualify for Small Business Administration (SBA) Economic Injury Disaster Loans (EIDLs), and that Medicare recipients can consult with their providers by telephone or teleconference, if necessary or desired.

Phase 2, H.R. 6201, the Families First Coronavirus Response Act, became law on March 18, 2020. This package, expected to cost $192 billion over the next decade, included provisions for paid sick leave, free coronavirus testing, expanded food assistance, additional unemployment benefits, and requirements that employers provide additional protection for health care workers.

Phase 3, H.R. 748, the Coronavirus Aid, Relief, and Economic Security (CARES) Act, signed into law on March 27, 2020, represents the largest relief bill in U.S. history at $2.2 trillion. The legislation provided direct payments to individual taxpayers and their dependents, a huge expansion of unemployment benefits, student loan forbearance, and much more.

Phase 3.5, H.R. 266, the Paycheck Protection Program and Health Care Enhancement Act, signed into law on April 24, 2020, provided interim funding for parts of the CARES Act. Specifically, Phase 3.5 restarted the Paycheck Protection Program (PPP) and EIDL lending programs that ran out of money on April 16, 2020, and refreshed funding for hospitals, health care providers, and coronavirus testing provided for in Phase 3. The bill had a total cost of $484 billion.

Phase 4, H.R. 133, the Consolidated Appropriations Act (CAA), 2021, signed into law on Dec. 27, 2020, provided $900 billion in COVID-19-related relief for individuals, businesses, health care providers, and tribal and local governments.

Phase 5, H.R. 1319, the American Rescue Plan Act of 2021, signed into law by President Biden on March 11, 2021, allocated $1.9 trillion in funding for the third round of direct payments to taxpayers, additional unemployment funding, money for states and municipalities, and more.

Impact on Your Financial Life

Let’s take a look at some of the provisions included in these six bills.

Free Vaccines (Phases 1, 3, 4, and 5)

H.R. 6074 provided that “vaccines, therapeutics, and diagnostics” funded by this law will be “affordable.” While the definition of “affordable” is unclear, there was a commitment on the part of the government to ensure no price gouging when it comes to coronavirus treatment.

The CARES Act further declared that access to testing and any future vaccine will be available “without cost-sharing.” In other words, the vaccine and testing to find out if you have coronavirus are free.

The Consolidated Appropriations Act, 2021 provided $20 billion for the purchase of vaccines, as well as another $8.75 billion for vaccine distribution. It also earmarked $27 billion to assist states with their testing programs.

Finally, the American Rescue Plan provided the following funding:

• $8.5 billion went to the Centers for Disease Control and Prevention (CDC) for vaccine activities, including a supplemental funding opportunity for state, locality, and territory vaccine distribution grants from the December COVID-19 relief package based on entities receiving the higher of the two distribution formulas, as well as clarified use of standards for data and data sharing.
• Required the state Medicaid and Children’s Health Insurance Program (CHIP) to cover vaccines and COVID-19 treatment without any cost-sharing and extended the period of this policy to one year after the end of the public health emergency.
• Increased the Federal Medical Assistance Percentage (FMAP) to 100% for vaccine costs during this period.
• Appropriated $50 billion to the Disaster Relief Fund for COVID-19 and other disaster assistance under the Federal Emergency Management Agency (FEMA). The assistance is meant to bolster vaccine rollout efforts under FEMA and provide assistance to state and local governments at 100% federal cost-share.
• Provided $100 million via Emergency Management Performance Grants to state and local emergency management agencies to help communities address COVID-19 and facilitate vaccine rollout.

Small Business Relief (Phases 1, 3, 3.5, 4, and 5)

The first phase of COVID-19 relief established a $20 million Disaster Loans Program Account to provide money to small business owners in the form of low-cost SBA loans to help overcome the economic impact of COVID-19 on their business. Needless to say, this affected employees as well, since a closed business has no employees.

The CARES Act offered $349 billion in tax credits to small businesses and allowed them to defer paying payroll taxes so they could continue paying employees. Businesses with 500 or fewer employees could receive a Small Business Interruption Loan so long as they continued to pay workers. The loan could be used to cover 100% of eight weeks of payroll. The law called for the loans to be forgiven if the money was used to retain workers or cover basic operational expenses.

Phase 3.5 added $321 billion to the Small Business Interruption Loan program, also—and better—known as the Paycheck Protection Program (PPP). At least $60 billion of that amount was reserved for small lenders. Phase 3.5 also added $60 billion in new funding to the EIDL program—$50 billion for loans and $10 billion to refresh the forgivable loan advance of up to $10,000 per recipient.

In Phase 4, $325 billion was dedicated to small-business aid, including more than $284 billion to reopen the PPP, which had stopped accepting applications for the first round of forgivable loans in August 2020. As under the CARES Act, the reopened PPP granted first-time applicants with fewer than 500 employees forgivable loans of up to $2 million to cover payroll, rent, and utilities.

The PPP was available to all qualifying businesses, including those that had previously applied and received funding in the first round, provided that they had 300 or fewer employees, had used the full amount of their first PPP loan, and could show a 25% gross revenue decline in any 2020 quarter compared with the same 2019 quarter.

The Consolidated Appropriations Act specifically designated $12 billion for small businesses in low-income and minority communities, and $15 billion for live venues, independent movie theaters, and cultural institutions. Businesses that received PPP loans were able to deduct expenses associated with those loans, overturning a Treasury Department decision denying such deductions in the wake of the CARES Act.

The American Rescue Plan addressed the economic effects of COVID-19 by providing aid to households, small businesses, nonprofits, and industries such as tourism and hospitality. Specifically, the bill provided:

• $7.25 billion for PPP forgivable loans
• $15 billion for targeted EIDL advance payments
• funds to businesses in low-income communities with no more than 10 employees and more than 50% in economic loss
• $28.6 billion for restaurants, bars, and other eligible food and drink providers
• grants for pandemic-related revenue losses up to $10 million per entity, or $5 million per physical location
• $1.25 billion for shuttered venue operators
• $175 million to create a “community navigator” pilot program to increase participation in COVID-19 relief programs

The PPP Extension Act of 2021, signed into law on March 30, 2021, extended the PPP until May 31, 2021, and the PPP loan-covered period to June 30, 2021. The law also gave the SBA an extra 30 days, until June 30, 2021, to process the additional applications that were still pending.

Impact on Your Health and Well-Being

Medicare Telehealth Waiver (Phase 1)

A provision in the first relief bill required Medicare to allow clients to confer with medical professionals by phone, including FaceTime, Skype, and other telehealth services, even if they didn’t meet the previous requirement of living in a rural area or having some other qualifying condition.

HSAs Used for Telehealth and OTC Products (Phases 3 and 5)

The CARES Act provided that health savings accounts (HSAs) paired with high-deductible health plans (HDHPs) can offer pre-deductible coverage for telehealth and other types of remote services. It also extended the use of HSAs to nonprescription over-the-counter (OTC) medicines and certain menstrual care products.

The American Rescue Plan provided $14.4 billion for the Department of Veterans Affairs (VA) to provide health care services and related support to eligible veterans, including funding for the sustainment of CARES Act-supported staffing and service-level expansions.

Paid Sick Leave (Phases 2, 4, and 5)

The Families First Coronavirus Response Act required that your employer provide you with two weeks of paid sick leave if you are isolated due to COVID-19, have been advised to self-quarantine, are experiencing symptoms and seeking medical help, or are caring for someone under quarantine. You get up to 12 weeks of paid leave if you are caring for a child who is home because school is closed or your childcare provider is not available because of coronavirus.

Phase 4 continued tax credits to support employers, under the Families First Coronavirus Response Act, who offer paid sick leave during the COVID-19 pandemic, through March 31, 2021.

Phase 5 extended tax credits for employer-provided paid sick and family leave established under the Families First Coronavirus Response Act through Sept. 30, 2021.

Free Coronavirus Testing (Phases 2, 3, 3.5, 4, and 5)

Phase 2 provided free Food and Drug Administration (FDA)-approved COVID-19 testing for everyone—even the uninsured. Testing, without deductibles or co-payments, included the cost of a trip to the doctor or emergency room to get the test. The legislation did not cover additional tests or treatment. That will be up to your current health care plan, including Medicare and Medicaid.

Phase 3 expanded on the provisions of Phase 2 to include testing provided by labs on an emergency basis, state-developed tests, and any other tests authorized by the Department of Health and Human Services (HHS).

Phase 3.5 added $25 billion to the previous testing authorized by Phase 3.

Phase 4 provided $20 billion to purchase vaccines, as well as another $8.75 billion for distribution. It also set aside $27 billion to help states with their testing programs.

Phase 5 allocated $47.8 billion for coronavirus testing and tracing activities and prohibited states that extended a Medicaid option to provide testing and treatment from imposing cost-sharing. 

Expanded Food Assistance (Phases 2, 3, 4, and 5)

If you had food security issues—something more likely to be the case, as more and more people lost jobs due to workplace shutdowns—Phase 2 offered help. This included almost a billion dollars for the Special Supplemental Nutrition Program for Women, Infants, and Children Program (WIC). The bill also allocated $400 million for emergency food assistance, help for those with children eligible for free or reduced-price school lunches whose school is closed, and emergency Supplemental Nutrition Assistance Program (SNAP) benefits, including a temporary suspension of the SNAP three-month time limit on funding adults under age 50 with no children.

Phase 3 provided $450 million for the Emergency Food Assistance Program, to supply food banks and provide operational assistance. An additional $200 million went to food assistance for Puerto Rico and other U.S. territories, plus $100 million for food distribution at American Indian reservations. Nearly $16 billion was added to SNAP, and another $8.8 billion was made available to Child Nutrition Programs.

The Consolidated Appropriations Act, 2021:

• offered $82 billion in aid for K–12 schools and colleges
• provided $10 billion for childcare providers
• increased SNAP benefits by 15% for six months
• designated $45 billion for public transit systems
• designated $7 billion for expansion of broadband services
• designated $26 billion for nutrition services and agricultural and rural programs

The American Rescue Plan provided $1.434 billion for programs under the Older Americans Act, including $750 million for nutrition programs for 2021. The plan also:

• extended a 15% increase to monthly benefits under SNAP that were scheduled to lapse on June 30, 2021, through Sept. 30, 2021
• provided $1.15 billion to states for SNAP administration, as well as $1 billion for grants for nutrition assistance programs in U.S. territories
• provided $490 million to the U.S. Department of Agriculture (USDA) to increase the amount of the cash value vouchers provided under WIC to up to $35 during the pandemic
• required the USDA to reimburse emergency shelters for meals provided to individuals younger than 25 who receive services there
• extended the Pandemic EBT program through any school year or summer period following a designated public health emergency

Protections for Health Care Workers (Phases 2, 4, and 5)

If you are a health care worker, Phase 2 protected your medical and financial stability by requiring the Occupational Safety and Health Administration (OSHA) to issue an Emergency Temporary Standard (ETS) within 30 days that requires health care sector employers—or other employers designated to be at elevated risk—“to develop and implement a comprehensive infectious disease exposure control plan to protect health care workers from exposure to the SARS-CoV-2 virus that causes COVID-19.” In addition, OSHA must issue a permanent health and safety standard six months after the ETS has been issued.

Phase 4 allowed the use of “budgeted-to-actual” lost revenue calculation and transfer of “targeted distributions” within a health system. It also:

• added $3 billion to the Provider Relief Fund (PRF)
• eliminated $4 billion in Medicaid Disproportionate Share Hospital (DSH) cuts scheduled to go into effect in 2021 to 2023
• eliminated the 2% Medicare sequester cuts through March 2021
• lifted the cap on Medicare-funded physician residency positions in teaching hospitals effective in 2023
• established a new Rural Emergency Hospital Medicare designation
• provided approximately $3 billion in increased payments for physician services under the Medicare Physician Fee Schedule for 2021

Phase 5 reinforced the health care safety net with funding for rural health providers, community health centers, and skilled nursing facilities. It also modified Medicare and Medicaid, increased funding for behavioral health, and expanded access to individual health insurance coverage.

Expanded Unemployment Benefits (Phases 2, 3, 4, and 5)

Phase 2 provided nearly $1 billion in additional funding to states, to be used to process and pay unemployment insurance. Assistance was also available to provide additional payments for those who have exhausted their benefits.

Phase 3 provided an unprecedented boost in unemployment benefits, including $600 per week per worker for four months on top of state benefits. The stimulus package includes an additional 13 weeks of extended benefits, paid for by the federal government. The list of workers who qualify for unemployment benefits expands to include independent contractors, the self-employed, and gig economy workers. For specifics, check with your local unemployment office.

The Consolidated Appropriations Act, 2021 expanded unemployment benefits that were due to expire in late December 2020 and restarted the additional per-week, per-worker program. The $600 per-week benefit expired on July 31, 2020; the new benefit was for $300 per month and ran from Dec. 26, 2020, to March 14, 2021.

The American Rescue Plan:

• extended the expansions first created by the CARES Act through Sept. 5, 2021
• increased the total number of weeks of benefits available to individuals who cannot return to work safely from 50 to 79
• maintained the federal supplement at its current level of $300 a week for weeks beginning after March 14, 2021, and through Sept. 5, 2021
• provided 53 weeks of federal unemployment insurance (UI) benefits after state benefits end, up from 24 weeks
• exempted $10,200 of unemployment benefits received in 2020 from federal income taxes retroactively for individuals with incomes below $150,000. That amount is doubled for married couples filing jointly. If you filed your tax return early, the Internal Revenue Service (IRS) stated that it would automatically make adjustments for the exempt amount

States can choose to conform to the federal exemption or require that all taxes be paid. To see the rules in your state, click here.

Direct Payments to Families (Phases 3, 4, and 5)

The CARES Act legislation directed the U.S. Treasury to send most U.S. adults a check (or direct deposit) of $1,200 ($2,400 for couples filing jointly). Each child age 16 and under received an additional $500. Individuals with an adjusted gross income (AGI) (based on 2018 or 2019 tax returns) of $75,000 ($150,000 for couples filing jointly/$112,500 for the head of household) or less received the full amount. The direct payment was reduced by five cents ($0.05) for every dollar earned above the amounts listed above until it hits zero at $99,000.

The Consolidated Appropriations Act directed payments of $600 per individual or $1,200 per couple. For individuals, income had to be $75,000 or under, and $150,000 or under for couples filing jointly. Head of household maximum income was $112,500.

The American Rescue Plan provided a final stimulus payment of $1,400 to people making $75,000 or less annually. Individuals with an AGI of $75,000 or less—and couples with AGIs of $150,000 or less—received the full amount. Each qualified dependent also received the full $1,400, regardless of age. Payments to individuals with AGIs over $75,000 were reduced until they disappeared entirely at $80,000 ($160,000 for couples).

Suspension of Student Loan Payments (Phases 3 and 5)

The U.S. Department of Education automatically suspended payments on direct student loans without penalty through Sept. 30, 2021.

The American Rescue Plan further stipulated that any student loan forgiven or discharged from 2021 through 2025 will be tax-free. 

On Aug. 6, 2021, the Department of Education announced that it extended the pause on student loan payments and interest, along with all collection activity until Jan. 31, 2022, to provide borrowers with a seamless transition back to repayment.

Wages and Benefits for Airline Workers (Phases 3, 4, and 5)

The CARES Act included $32 billion in grants to cover wages and benefits for workers employed by passenger airlines, cargo airlines, and contractors. Companies that accept these funds and other assistance in the form of loans or loan guarantees were barred from making furloughs, pay cuts, stock buybacks, or issuing dividends to investors through September 2020.

Phase 4 provided $16 billion in payroll support to airlines and airline contractors and requires airlines to rehire previously furloughed employees and commit to refrain from conducting any further furloughs or pay reductions. This support ran through March 31, 2021. The act also included $2 billion in airport grants, to be used for costs related to operations, personnel, sanitation, and debt service payments.

The American Rescue Plan provided $8 billion for airports and airport concessions, with a caveat that those receiving funding must retain a minimum of 90% of personnel employed as of March 27, 2020, through Sept. 30, 2021. The U.S. Department of Transportation can issue a waiver if the airport is experiencing significant economic hardship or if the requirement has negative impacts on aviation safety or security.

Public Health Fund (Phases 3, 3.5, and 5)

The CARES act created a $100 billion public health and social emergency fund designed to reimburse providers for expenses and lost revenues during the crisis. Most of the funds will go to hospitals, with the rest earmarked for doctors, nurses, suppliers, and others.

Phase 3.5 inserted an additional $75 billion into the public health fund, with the majority of that money going to hospitals.

In total, the American Rescue Plan allocated $92.2 billion for various activities aimed at improving public health and responding to COVID-19, including:

• $8.5 billion to the CDC for vaccine activities
• $47.8 billion for testing and tracing activities for COVID-19
• $8.5 billion for vaccine activities at the CDC, including a supplemental funding opportunity for state, locality, and territory vaccine distribution grants from the December COVID-19 relief package based on entities receiving the higher of the two distribution formulas
• $7.66 billion for state, local, and territorial public health departments to establish, expand, and sustain their public health workforce
• $7.6 billion for community health centers
• $3 billion for block grant programs under the Substance Abuse and Mental Health Services Administration
• $6.09 billion to the Indian Health Service
• $800 million for the health workforce
• $200 million to support COVID-19 infection control in skilled nursing facilities and $250 million for “strike teams” to assist skilled nursing facilities, with funding until one year after the end of the public health emergency and clarification that the HHS secretary must require Quality Improvement Organizations to provide support to skilled nursing facilities and add vaccination uptake support as part of required activities

Protection Against Foreclosure and Eviction (Phases 3, 4, and 5, and Biden Executive Order)

The CARES Act codified protections for homeowners against foreclosure and renters against eviction. If you are experiencing financial hardship due to the coronavirus pandemic, then you will be granted forbearance on your federally-backed mortgage loans until Sept. 30, 2021.

The FHFA said on July 28, 2021, that all multifamily property owners with loans backed by either Freddie Mac or Fannie Mae must give tenants 30-days of notice before being required to vacate the property.

In addition to reinstating the eviction moratorium and mortgage forbearance, the American Rescue Plan provides:

• $21.55 billion for emergency rental assistance through Sept. 30, 2027
• $5 billion in emergency housing vouchers through Sept. 30, 2030
• $750 million for tribal housing
• $100 million for rural housing
• $5 billion to assist people experiencing homelessness

On June 25, 2021, the CDC announced it would extend the eviction moratorium to July 31, 2021, noting that this would be the final extension. Despite its previous final extension statement, the CDC issued a new targeted order on Aug. 3, 2021, extending the eviction moratorium until Oct. 3, 2021. The Supreme Court vacated the CDC order, however, effectively ending the eviction moratorium on Aug. 26, 2021.

The CDC order that was vacated by the Supreme Court was aimed at areas of high or substantial COVID-19 transmission rates as identified by the CDC. The CDC Level of Community Transmission by State/Territory map provided guidance on areas impacted by the latest moratorium.

Special Rules for Retirement Funds (Phase 3)

The CARES Act effectively waived the 10% tax penalty for early withdrawals from retirement funds if those withdrawals are related to the coronavirus. The waiver is retroactive to Jan. 1, 2020. In addition, those who withdraw from retirement funds have up to three years to either pay the income tax due on the withdrawal (normally due the same year) or redeposit the funds withdrawn with no tax penalty. IRS guidance expanded eligibility for individual retirement account (IRA) and 401(k) withdrawals up to $100,000 for people who started a job late, had a job offer rescinded, or were spouses with retirement accounts affected by COVID-19, in addition to those directly affected by the coronavirus.

Also, account owners subject to required minimum distributions (RMDs) from their retirement accounts did not have to take RMDs in 2020, to allow time for the funds to build up again.

Money Market Mutual Funds Guarantee (Phase 3)

If you are an investor, Section 4015 of the CARES Act that temporarily suspended the restrictions of the Emergency Economic Stabilization Act of 2008 might be of interest. The legislation permitted the temporary use of the Exchange Stabilization Fund to guarantee money market mutual funds. The guarantee was terminated on Dec. 31, 2020.