President Donald Trump recently signed into law a $2 trillion stimulus package to mitigate the effects of the COVID-19 pandemic. Below is a summary of some provisions of the law, including how it would affect New Yorkers.
State and Local Governments
A $150 billion fund is created for state and local governments. The funding is based on population, but no state will receive a payment that is less than $1.25 billion. States must use 45 percent of their funds for local governments with populations over 500,000.
New York is expected to receive $5.1 billion for these provisions. Additionally, there is $425 billion available to cities and states (along with businesses) through the Federal Reserve.
Direct Payments to Taxpayers
The federal government will make direct cash payments to taxpayers who fall within certain income ranges. The income amounts are based on your adjusted gross income (line 8b of your most recently filed federal 1040 tax form) New Yorkers are projected to receive $15 billion under this program.
Single Tax Filers
Income Range: Up to $99,000
Cash Payment: $1,200, plus $500 for any child that you claimed on your most recent federal tax return.
If your adjusted gross income is $75,000 or less, you will receive $1,200, plus $500 for every child who you claimed on your most recently filed federal income tax form. For single tax filers who make between $75,001-$99,000, your cash payment will be reduced by 5 percent of your adjusted gross income that is more than $75,000.
For example, a single-income filer with no kids who makes $42,000
Cash Payment: $1,200
Single-income filer with no kids who makes $85,000
Cash Payment: $700 ($10,000 of income is above $75,000. 5 percent of $10,000 is $500. $1,200 minus $500 = $700)
Married Couples
Income Range: Up to $198,000
Cash Payment: $2,400, plus $500 for any child who you claimed on your most recent federal tax return.
If your adjusted gross income is $150,000 or below, you will receive $2,400, plus $500 for every child who you claimed on your most recently filed federal income tax form. For married couples who make between $150,001-$197,999, your cash payment will be reduced by 5 percent of your adjusted gross income that is in excess of $150,000.
For example, a married couple with two kids who make $135,000
Cash Payment: $3,400 ($2,400 plus $500 per child)
Married couple with two kids who make $185,000
Cash Payment: $1,650 ($35,000 of their income is in excess of $150,000. 5 percent of $35,000 is $1,750, which reduces their payment from $2,400 to $650, plus $500 per child).
Qualifying incomes will be based on your 2019 income tax return, if you have already filed, or your 2018 return if you have not yet filed.
The federal stimulus package also includes grants for hospitals and other health care entities; child care and other human services; education, including school districts and higher education; expanded unemployment insurance and assistance for businesses affected by the pandemic. To learn more, visit cseany.org.
