OneDigital Benefits Compliance Consulting

 ISSUED 03/11/21

In the first sweeping legislation  for the new 117th  Congress, H.R.1319, a $1.865  trillion-dollar COVID-19 relief bill, becomes law. Here’s are the steps  this bill took:

•  Congressional budget resolution to use budget reconciliation*  for this bill

•  February  24 - introduction of the bill in the House

•  February  27 - narrow passage of the bill in the House  (219-212)

•  March 2 - introduction to the Senate

•  March 5-6 - Senate consideration of 509 amendments and  agreement of final amendments

•  March 6 - Senate passes bill with amendments narrowly (50-49)

•  March 9 - forward of the final draft to the House

•  March 10 - reconsideration by the House  of final version ends  in narrow passage (220-211)

•  March 11 - President signs into law

Within the  bill are specific  areas  that  impact  employers and  employee benefits. Here  are the segments of interest:

Child Care Tax Credit
 

*Budget  reconciliation  is a special  process that allows for easier  passage of the

bill through the Senate.  It allows passage with a simple majority, eliminates  the filibuster by limiting debate to

20 hours, limits amendments to those that reduce the deficit or are deficit-neutral,

and requires that all provisions of the bill affect the budget, e.g., revenue, expenses, or

the debt limit.

Section 9611. Child Tax Credit Improvements for 2021 – Applies to tax  years  beginning after  December 31,  2020, and before

January 1, 2022.

•  A special  rule is added the  2021  tax year, increasing the  credit,  for each  child,* from the standard $1,000 to $3,000 ($3,600  for children  who have  not attained the  age  of six as of

12/31/21)

•  The child tax credit  for taxpayers with a principal  place  of residence for more  than  half of the  taxable year, or is a bona fide resident of Puerto Rico for the  taxable year,

•  The amount of the  tax credit  is reduced by $50 for each  $1,000 by which the  taxpayer’s adjusted gross  income exceeds the  applicable percentage

•  Applicable threshold- applies by type  of return  filed

○    $150,000 for joint return

○    $112,500 for head of household

○    $75,000 in any other case

*Referenced as “qualifying child of the taxpayer  under 26 U.S. Code  § 24. Child tax credit,  which is a child of the taxpayer  who has not attained age  18.

Section 9631. Refundability  and Enhancement of Child and Dependent Care Tax Credit – Applies to tax  years  beginning after

December 31,  2020, and before January 1, 2022.

•  For taxpayers who have  a principal  place  of abode in the  United  States for more  than  half the  year, the  amount of the employment-related expenses incurred during  any taxable year which may be  taken  into account shall not exceed:

○    $8,000 (previously  $3,000)  if there is one  qualifying  individual  with respect to the  taxpayer for such taxable year, or

○    $16,000 (previously  $6,000)  if there are two or more  qualifying  individuals  with respect to the  taxpayer for such taxable year

○    Phase-out percentage- means 20 percent reduced (but not below  zero) by one  percentage point  for each  $2,000 (or fraction thereof)  by which the  taxpayer’s adjusted gross  income for the  taxable year exceeds $400,000

Section  9632. Increase in Exclusion for Employer-Provided Dependent Care Assistance – Applies to  tax years  beginning after

December 31,  2020, and before January 1, 2022.

•  Gross  income of an employee does not include  amounts paid  or incurred by the  employer for dependent care  assistance provided to such employee if the  assistance is furnished pursuant to a program

•  The amount which may be  excluded for dependent care  assistance with respect to dependent care  services  shall not exceed

$10,500 (previously  $5,000)  or $5,000 (previously  $2,500)  in the  case  of a separate return  by a married individual).

•  Retroactive Plan Amendments- A plan that  otherwise satisfies  all applicable requirements of sections 125 and  129 of the Internal  Revenue Code of 1986  (including  any rules or regulations thereunder) shall not fail to be  treated as a cafeteria plan or dependent care  assistance program merely  because such plan is amended pursuant to a provision  under this section and  such amendment is retroactive, if-

○    such amendment is adopted no later   than  the  last day of the  plan year in which the  amendment is effective, and

○    the  plan is operated consistent with the  terms  of such amendment during  the  period beginning on the  effective  date of the amendment and  ending on the  date the  amendment is adopted

COBRA Election  and Premium  Assistance

Section 9501. Preserving Health Benefits for  Workers (COBRA Eligibility  Changes) – “Effective period” is expanded first  of  the month after the date of  enactment, i.e.  April  1, 2021, through September 30,  2021.

•  “Effective period” is now cumulatively November 1, 2019,  through September 31, 2021

•  Assistance applies to premium during  the  effective  period

•  “Assistance eligible individual” (AEI) means any individual  who, during  the  effective  period, is a qualified beneficiary who is eligible  for COBRA, or state continuation, by reason of a qualifying  event (except for those who voluntarily terminate) and  who elect  coverage

•  AEIs enrolled in a group health plan may change their election to a different plan offered by the  plan sponsor if:

○    the  employer permits this type  of enrollment change;

○    the  premium does not exceed the  premium of the  individual’s existing  coverage;

○    other similarly situated active  employees have  the  option to enroll in the  plan;

○    done so within 90 days  of plan enrollment date and  the  plan is not coverage that  provides only excepted benefits, is a

Qualified Small Employer Health  Reimbursement Arrangement (QSEHRA), or a flexible spending account (FSA)

•  COBRA premium will be  considered satisfied, for any AEI, during  the  covered period, i.e., subsidized at 100%

•  Premium  assistance is unavailable for months of coverage on or after:

○    The first date the  individual  is eligible  for other group health plan coverage, has coverage under a flexible spending arrangement, QSEHRA or Medicare; or

○    The earlier  of the  date following the  maximum  period of continuation under COBRA rules or the  date following the expiration date of the  extended election period

•  “Extension of Election  Period” allows a new election period for AEIs who do  not have  COBRA coverage as of the  month following the  date of enactment

○    applies to those who did not previously  elect  COBRA or who took  COBRA and  dropped it

○    enrollment window begins the  first of the  month following the  date of enactment, April 1, 2021,  and  ends 60 days  after  the date on which notification is provided

○    COBRA extension coverage begins on the  first day of the  first month beginning after  the  date of enactment and  ends no earlier  than  that  which would  have  been required under the  applicable COBRA continuation coverage provision

•   Notices to Individuals

○    Must include  the  availability of premium assistance and  the  option to enroll in different coverage

○    Employers/plan sponsors may meet this requirement by amending their current  COBRA election forms or including a separate document with the  notice

○    Notices must  include:

■  the  forms necessary for establishing eligibility for premium assistance;

■  the  name, address, and  telephone number necessary to contact the  plan administrator and  any other person maintaining relevant information in connection with such premium assistance;

■  a description of the  extended election period;

■  a description of the  obligation of the  qualified beneficiary to notify group health plan of eligibility status;

■  a description, displayed in a prominent manner, of the  qualified beneficiary’s right to a reduced premium and  any conditions on entitlement to the  reduced premium; and

■  a description of the  option of the  qualified beneficiary to enroll in different coverage if the  employer permits such beneficiary to elect  to enroll in such different coverage

○    Must be  made, within 60 days  of the  first day of the  first month after  the  date of enactment, April 1, 2021,  to any AEI who

became eligible  for COBRA prior to the  date of enactment

○    Within 30 days  of the  date of enactment, respectively, i.e., April 1, 2021,  the  Secretaries of Labor and  Health  and  Human

Services  will provide COBRA extension/premium assistance model notice and  notice of the  expiration of premium assistance

○    Notice  to AEI’s expiration of premium assistance must:

■  be  made within 15-45  days  prior to the  expiration of premium assistance

■  contain clear and  understandable language stating when  the  premium assistance will end

■  include  the  individual’s eligibility for continued coverage, without  premium assistance, under COBRA or a group health plan (unless they are no longer eligible  due  to expiration of COBRA period or coverage under another group health plan)

Section 6432.  Continuation Coverage Premium Assistance – Applies to premiums and wages paid  on or after  April 1, 2021.

•  Employers may take  a credit  against their hospital insurance taxes  (§ 3111(b)) for each  calendar quarter and  amount equal to the  premiums not paid  by AELs for such coverage

•  The credit  may not exceed the  total  tax imposed under § 3111(b) with respect to the  employment of all employees of the employer

•  If the  credit  exceeds the  limit for any calendar quarter, it will be  treated as an overpayment that  shall be  refunded

•  In anticipation of the  credit,  the  credit  may be  advanced, including the  refundable portion, up to an amount calculated through the  end  of the  most  recent payroll period in the  quarter

•  Includes government of any State  or political  subdivision, any Indian tribal government, any agency or instrumentality of any

of the  foregoing, and  any agency or instrumentality of the  Government of the  United  States that  is described in section 501(c)(1)

and  exempt from taxation under section 501(a)

•  The credit  does not apply  with respect to any amount which is taken  into account as qualified wages under the  Employee

Retention Credit  or the  credits  for paid  sick leave  or family leave  in this law or under the  Families First Coronavirus Response Act

•  The period for the  assessment of any amount attributable to a credit  shall not expire  before five years after  the  later  of the  date on which the  original  return  is filed or the  date on which the  return  is treated as filed

•  Employee payments exceeding the  amount after  assistance must  be  returned to the  employee within 60 days  of the  date that they elect  continuation

Section 6720C. Penalty  for Failure to Notify  Health Plan of Cessation of Eligibility for Continuation Coverage Premium

Assistance – Applies to tax  years  after the date of  enactment.

•  Individuals  who fail to notify employers when  they are no longer eligible  may pay a penalty of $250

•  If failure to notify is intentional or fraudulent, the  penalty is equal to the  greater of $250  or 110% of the  premium assistance after  termination of eligibility

•  The penalty may be  waived  if it is shown  that  the  failure is due  to reasonable cause and  not willful neglect

•  Section  139I. Continuation Coverage Premium  Assistance – Applies  to tax years after  the  date of enactment

Section 139I.  Continuation Coverage Premium Assistance – Applies to premiums and wages paid  on or after  April 1, 2021

•  Gross  income does not include  any premium assistance provided under section 2401

Section 9651. Extension of Employee Retention Credit – Applies to calendar quarters beginning after  June 30,  2020.

•  Credit  allowed against applicable employment taxes  for each  calendar quarter equal to 70% of qualified wages paid  to employees after  June 30, 2020,  and  before January 1, 2022,  for any calendar quarter, up to a maximum  of $10,000 per employee per  calendar quarter (recovery  start-up businesses* = up to $50,000 for any calendar quarter)

•  Allows credit  against the  1.45% hospital insurance tax, i.e., Medicare rate  (payable as part  FICA)

for each  calendar quarter to 100% of the  qualified sick leave  wages paid  by the  employer with respect to such calendar quarters

•  Does  not apply  to the  Government of the  United  States, the  government of any State  or political  subdivision, or any agency or instrumentality, unless  they are 501(c)(1) organizations, entities exempt from tax under 501(a), a college or university,  or whose  principal  purpose is to provide medical or hospital care

•  Credit  availability- The credit  is available  to employers whose:

A.   operations were  fully or partially suspended during  the  calendar quarter due  to orders from an appropriate governmental authority limiting commerce, travel,  or group meetings (for commercial, social, religious, or other purposes) due  to the  coronavirus disease 2019 (COVID–19), or

B.   gross  receipts for such calendar quarter are less than  80 percent of the  gross  receipts of such employer for the  same  calendar quarter in calendar year 2019.

•  Qualified wages means:

○    in the  case  of an eligible  employer for which the  average number of full-time employees (within the  meaning of section

4980H)* employed during  2019  was greater than  500 - wages paid  for which an employee is not providing services  due  to applicable circumstances

○    in the  case  of an eligible  employer for which the  average number of full-time employees

(within the  meaning of section 4980H) employed during  2019  was not greater than  500:

■  wages paid  during  any period for employers described under Credit  Availability reason A, or

■  wages paid  employee during  such quarter for employers described under Credit  Availability reason B

○    Wages include  the  amounts paid  by an employer to provide and  maintain a group health plan  as long  as the  amounts are excludable from the  gross  income of employees by reason of  section 106(a)

*Recovery start-up businesses: Any employer which began carrying

on any trade  or business after February  15, 2020, for which the average annual  gross  receipts for the three  years prior to the quarter for which the

credit  is determined, does not exceed $1,000,000 and neither  “Credit  Availability” items A or B apply.

*4980H: The employer shared responsibility provision of the Affordable  Care Act that defines  the calculation

of “full-time equivalent

employees.”

Federal  Employee Leave  Fund

Section 5111. Emergency Federal  Employee Leave Fund – Leave paid  under this section may  only  be provided to and  used by an employee as of  the date of  enactment and  ending on  September 30,  2021.

•  Applies  to individuals  in the  executive branch, United  State  Postal  Service,  Postal  Regulatory Commission, and  Public Defender

Service for the  District of Columbia and  District of Columbia Courts

•  Amounts available  for reimbursement to an agency for the  use  of paid  leave  by any employee who is unable to work because the  employee:

1.   is subject to a Federal, State, or local quarantine or isolation  order related to COVID–19;

2.   has been advised by a health care  provider to self-quarantine due  to concerns related to COVID–19;

3.   is caring  for an individual  who is subject to such an order or has been so advised;

4.   is experiencing symptoms of COVID–19 and  seeking a medical diagnosis;

5.   is caring  for a son or daughter of such employee if the  school  or place  of care  of the  son or daughter has been closed, if the  school  of such son or daughter requires or makes  optional a virtual learning instruction model or requires or makes optional a hybrid  of in-person and  virtual learning instruction models, or the  child care  provider of such son or daughter is unavailable, due  to COVID–19 precautions;

6.   is experiencing any other substantially similar condition;

7.   is caring  for a family member with a mental or physical  disability  or who is 55 years of age  or older  and  incapable of self- care,  without  regard to whether another individual  other than  the  employee is available  to care  for such family member if the  place  of care  for such family member is closed or the  direct  care  provider is unavailable due  to COVID–19; or

8.   is obtaining immunization related to COVID–19 or to recover from any injury, disability,  illness, or condition related to such immunization.

•  Paid leave  shall not exceed:

○    600 hours  of paid  leave  for each  full-time employee

○    Proportional equivalent of 600 hours  for those who are part-time, on an uncommon tour of duty,  or seasonal work schedule

○    May not exceed $2,800 in aggregate for any biweekly  pay period for a full-time employee, or a proportional equivalent biweekly  limit for a part-time employee

•  Paid leave  provided under this section is in addition to any other leave  provided to an employee and  may not be  used concurrently with any other leave

•  Any amount paid  under this provision  will reduce the  total  service  used to calculate any Federal civilian retirement benefit

Paycheck Protection Program  (PPP)

Section 5001. Modifications to the Paycheck Protection Program

•  Eligibility  of Certain Non-Profit Entities- expands to include  all 501(c) entities other than  paragraphs (3), (4), (6), or (19), and exempt from tax under section 501(a) of such Code

○    Employs  500 or fewer employees per  physical  location and  an additional covered nonprofit entity  would  be  eligible  for a

covered loan shall be  eligible  if they employ not more  than  300 employees per  physical  location

○    Additional covered nonprofit entities are eligible  if they do  not receive more  than  15% of its receipts from lobbying activities,  the  lobbying activities  do  not comprise 15% or more  of the  activity of the  organization, the  cost  of lobbying activities  did not exceed $1,000,000 during  the  most  recent tax year of the  additional covered nonprofit entity  that  ended prior to February 15, 2020,  and  they do  not employ more  than  300 employees

○    Extends eligibility for second draw loans  to additional covered nonprofit entities

•  Eligibility for Internet  Publishing  Organizations- expands to include  businesses with  North American Industry Classification

System (NAICS) code of 519130.

○    Employs  500 or fewer employees per  physical  location or size standard established by NAICS

○    Must have  a majority  ownership or control  by a business concern or organization assigned NAICS code 519130

○    Business  certifies  in good faith as an Internet-only news  or periodical publisher and  is engaged in the  collection and distribution of local, regional, or national news  and  further  certifies  that  proceeds will be  used to support expenses that support regional or local news

○    Extends eligibility for second draw loans  to these publishing entities

•  Coordination with Continuation Coverage Premium Assistance- extends loan forgiveness to coincide with the  continuation coverage premium assistance period

Section 5002. Targeted EIDL Advance

•  Authorizes supplemental payment of $5,000 to impacted small businesses

•  “Severely impacted small business” means a covered entity  that  suffered an economic loss greater than  50% and  that  employs not more  than  ten  people

•  “Substantially impacted small business” means a covered entity  that  employs not more  than  ten  employees and  is not a severely  impacted small business

•  Beginning 28 days  after  the  date of enactment, the  Administrator will begin processing loans  for the  severely  impacted small businesses.

•  Beginning 42 days  after  the  date of enactment, the  Administrator will begin processing loans  for the  substantially impacted small businesses.

Section 5003. Support  for Restaurants

•  Authorizes supplemental payment of $5,000 to impacted small businesses

•   Covered period-  period beginning February 15, 2020,  and  ending December 31, 2021,  or a date determined by the

Administrator that  is not more  than  two years after  the  date of enactment

•  Eligible  entity-  means a restaurant, food  stand, food  truck, food  cart, caterer, saloon, inn, tavern, bar,  lounge, brewpub, tasting room,  taproom, licensed facility or premise of a beverage alcohol  producer where  the  public  may taste, sample, or purchase products, or another similar place  of business in which the  public  or patrons assemble for the  primary purpose of being served food  or drink

○    does not include  an entity  that  is a State  or local government-operated business, as of March 13, 2020,  owns or operates

(together with affiliates) more  than  20 locations even  if regardless of whether they are doing business under the  same  or multiple  names, is a publicly-traded company, or has a pending application or has received a grant  under the  Economic Aid to Hard-Hit  Small Businesses, Nonprofits, and  Venues  Act

•   “Affiliated business” means a business in which an eligible  entity  has an equity  or right to profit distributions of not less than

50 percent, or in which an eligible  entity  has the  contractual authority to control  the  direction of the  business, provided that such affiliation shall be  determined as of any arrangements or agreements in existence as of March 13, 2020.

•  “Pandemic-related revenue loss”  means the  gross  receipts during  2020  subtracted from the  gross  receipts of 2019

○    “Payroll costs” means the  sum of payments of any compensation with respect to employees that  is a

■  salary, wage, commission, or similar compensation;

■  payment of cash   tip or equivalent;

■  payment for vacation, parental, family, medical, or sick leave;

■  allowance for dismissal  or separation;

■  payment required for the  provisions of group health care  benefits, including insurance premiums;

■  payment of any retirement benefit; or

■  payment of State  or local tax assessed on the  compensation of employees; and

■  the  sum of payments of any compensation to or income of a sole proprietor or independent contractor that  is a wage, commission, income, net  earnings from self-employment, or similar compensation and  that  is in an amount that  is not more  than  $100,000 in 1 year, as prorated for the  covered period; and

■  shall not include-

–  the  compensation of an individual  employee in excess of an annual  salary of $100,000, as prorated for the covered period;

–  taxes  imposed or withheld under chapters 21, 22, or 24 of title 26 during  the  covered period;

–  any compensation of an employee whose  principal  place  of residence is outside of the  United  States;

–  qualified sick leave  wages for which a credit  is allowed under section 7001  of the  Families First Coronavirus

Response Act (Public Law 116–127);  or

–  qualified family leave  wages for which a credit  is allowed under section 7003  of the  Families First Coronavirus

Families First Coronavirus Response Act

–  qualified wages taken  into account in determining the  credit  under section 2301  of the  CARES Act

–  credits  allowed under section 6432

•  Maximum Loan- Restaurant revitalization  grants shall not exceed $10,000,000 and  shall be  limited  to $5,000,000 per  physical location

○    Total loan amount shall be  equal to the  pandemic-related revenue loss of the  eligible  entity

○    Any amount of a grant  based on estimated receipts that  is greater than  the  actual  gross  receipts of the  eligible  entity  in

2020  shall be  returned to the  Treasury

•  Use of funds- during  the  covered period, expenses for the  following incurred as a direct  result  of, or during, the  COVID-19 pandemic

A.   Payroll costs

B.   Payments of principal  or interest on any mortgage obligation (which shall not include  any prepayment of principal  on a mortgage obligation)

C.   Rent payments, including rent  under a lease  agreement (which shall not include  any prepayment of rent) D.   Utilities

E.   Maintenance expenses, including-

■  construction to accommodate outdoor seating; and

■  walls, floors, deck  surfaces, furniture,  fixtures, and  equipment. F.     Supplies, including protective equipment and  cleaning materials

G.   Food  and  beverage expenses that  are within the  scope of the  normal  business practice of the  eligible  entity  before the covered period.

H.   Covered supplier costs,  as defined in section 7A(a) of the  Small Business  Act (as redesignated, transferred, and  amended by section 304(b) of the  Economic Aid to Hard-Hit  Small Businesses, Nonprofits, and  Venues  Act (Public Law 116–260)).

I.    Operational expenses

J.    Paid sick leave

K.   Any other expenses that  the  Administrator determines to be  essential to maintaining the  eligible  entity

•  Return of funds- entities who do  not use  or cease operations permanently on or before the  last day of the  covered period shall return  any unused funds  to the  Treasury

Paid Sick and Family Leave

Section 9641. Payroll Credits  – Applies to calendar quarters after March  31,  2020, and  to wages paid  with  respect to the period beginning on  April  1, 2021, and  ending September 30,  2021.

•  Allows credit  against the  1.45% hospital insurance tax, i.e., Medicare rate  (payable as part  FICA) for each  calendar quarter to

100% of the  qualified sick leave  wages paid  by the  employer with respect to such calendar quarters

•   Amends certain  Emergency Paid Sick Leave (EPSL) and  Extended Family Leave (EFML) provisions defined under the  Families

First Coronavirus Response Act (FFCRA)

•  Modifies  EPSL reason #3 to now state:

○    “The  employee is experiencing symptoms of COVID–19 and  seeking a medical diagnosis, the  employee is seeking or awaiting  the  results  of a diagnostic test  for, or a medical diagnosis of, COVID-19 and  such employee has been exposed to COVID-19 or the  employee’s employer has requested such test  or diagnosis, or the  employee is obtaining immunization related to COVID–19 or recovering from any injury, disability,  illness, or condition related to such immunization” and

○    For EFML, removes the  requirement to exhaust the  ten  days  of sick leave  prior to its application

•  No credit  shall be  allowed under this section to any employer for any calendar quarter if such employer, with respect to the  availability of the  provision  of qualified sick leave  wages to which this section otherwise applies for such calendar

quarter, discriminates in favor of highly compensated employees (within the  meaning of section 414(q)), full-time employees, or employees on the  basis  of employment tenure with such employer.

•  Allowable  qualified wages for EFML shall not exceed $200  per  day or $12,000 in aggregate (previously  $10,000)

Section 9642. Credit for  Sick Leave  for  Certain Self-Employed Individuals and  Section 9643. Credit for  Family Leave  for Certain Self-Employed Individuals – Applies calendar quarters beginning after March  31,  2021, and  to days  during the period beginning on  April  1, 2021, and  ending September 30,  2021.

•   Amends certain  Emergency Paid Sick Leave (EPSL) and  Extended Family Leave (EFML) provisions defined under the  Families

First Coronavirus Response Act (FFCRA)

•   Expands the  benefit to be  available  separately with respect to each  taxable year

•  Modifies  EPSL allowable reason #3 to now state:

○    “The  employee is experiencing symptoms of COVID–19 and  seeking a medical diagnosis, the  employee is seeking or awaiting the  results  of a diagnostic test  for, or a medical diagnosis of, COVID-19 and  such employee has been exposed to COVID-19 or the  employee’s employer has requested such test  or diagnosis, or the  employee is obtaining immunization related to COVID–19 or recovering from any injury, disability,  illness, or condition related to such immunization” and

○    For EFML, removes the  requirement to exhaust the  ten  days  of sick leave  prior to its application

•  The sick leave equivalent amount is:

○    the  number of days  during  the  taxable year (but not more  than  ten) that  the  individual  is unable to perform services  in

any trade or business for a reason with respect to which such individual  would  be  entitled to receive sick leave  (as defined above), multiplied by

○     (B) the  lesser  of-

■  $200  ($511 in the  case  of any day of paid  sick time   described in paragraph (1), (2), or (3) of section 5102(a) of the

Emergency Paid Sick Leave Act, or

■  67 percent (100 percent in the  case  of any day of paid  sick time  described in paragraph (1), (2), or (3) of section 5102(a) of the  Emergency Paid Sick Leave Act) of the  average daily self-employment income of the  individual  for the  taxable year.

•   Average daily self-employment income is the  net  earnings from self-employment of the  individual  for the  taxable year, divided by 260

•  Coordination with credit  for sick leave  - Any day taken  into account in determining the  qualified sick leave  equivalent amount with respect to any eligible  self-employed individual  under section 9642  shall not be  taken  into account in determining the qualified family leave  equivalent amount with respect to such individual  under this section.

Premium  Tax Credit

Section 9661. Improving  Affordability  by Expanding  Premium Assistance for Consumers  – Applies to taxable years  beginning in

2021 or 2022.

Adjusts  the  determination for premium subsidies in the  Exchange. This law temporarily modifies an individual’s eligibility for a subsidy by removing any limitation  based on income but,  instead, caps  the  premium at no more  than  8.5% of household income. As indicated in the  chart  below,  amounts above the  individual’s threshold are reimbursable to the  individual  based on the  lesser  of the premium cost  or the  cost  of the  second lowest  cost  silver plan in the  rating  area  where  the  individual  resides.

Section 9663. Application Premium Tax Credit in Case  of Individuals Receiving Unemployment Compensation During 2021 –

Applies to taxable years  beginning in 2021 or 2022.

•  In the  case  of a taxpayer who has received, or has been approved to receive, unemployment compensation for any week beginning during  2021,  for the  taxable year in which such week begins-

○    such taxpayer shall be  treated as an applicable taxpayer, and

○    there shall not be  taken  into account any household income of the  taxpayer in excess of 133% of the  poverty line for a family of the  size involved,  i.e., they are eligible  for the  maximum  premium assistance regardless of actual  previous income

Recovery Rebates for Individuals

Section 9601. Additional Recovery  Rebates for Individuals – This new credit  is in addition to the  credit  previously  paid.

•  For the  tax year beginning in 2021,  eligible  individuals  will receive a credit  in the  amount of:

○    $1,400 per  adults  ($2,800  married filing jointly) plus $1,400 for each  dependent of the  taxpayer

○    Applies  to individuals  with adjusted gross  income up to $75,000 per  taxpayer, $112,500 for head of household, or $150,000 for married filing jointly

○    Credits  are not available  for taxpayers with income over $99,000, $146,000 for head of household, or $150,000 for married filing jointly

○    No payments will be  made for any taxpayer deceased prior to January 1, 2021

•  Eligibility is anyone who is not a nonresident alien individual,  or any individual  claimed as a dependent of another taxpayer, or an estate or trust

•  Receiving  the  Rebate. Generally, a credit  increases the  amount of your tax refund  or decreases the  amount of taxes  owed. The amount you receive for the  Recovery  Rebate Credit  will be  included as part  of your refund  or applied to any tax owed.

Student Loan Forgiveness

Section 9675. Modification of Treatment of Student Loan  Forgiveness – Applies to gross income after  December 31,  2020, and before January 1, 2026.

Makes student loan forgiveness tax-free. Previous  laws made any student loan debt canceled by the  government a part  of gross income, i.e., taxable.

Unemployment Provisions of the  CARES Act

Section 9011. Extension of Pandemic  Unemployment Assistance – Effective upon enactment as if included in the CARES  Act and  applies to payments pertaining to weeks of  unemployment after March  14,  2021.

•  Extension from March 14, 2021,  to September 6, 2021,  for those currently  receiving, but  not yet exhausting, benefits and  for relief for governmental entities and  nonprofit organizations

•  Increases maximum  number of weeks  from 50 to 79

•  Adds  additional unemployment funding of $400  per  week for weeks  of unemployment beginning on or after  March 14, 2021, and  ending before September 6, 2021

Workers’  Compensation

Section 4016. Eligibility  for  Workers’ Compensation Benefits for  Federal Employees Diagnosed with  COVID-19.  Limitation –

Duration of  benefits may  not  exceed September 30,  2030.

•  Applies  to covered employees employed in the  Federal service  at any time  between January 27, 2020,  and  January 27, 2023.

•   “Covered employees” are those who are diagnosed and  who, during  a covered exposure period prior to their diagnosis, carry out duties that

○    require contact with patients, members of the  public  or co-workers; or

○    include  a risk of exposure to the  novel  coronavirus (does  not apply  to those exclusively teleworking during  a covered exposure period)

•  Allows workers’ compensation coverage for employees exposed to, and  who contract, the  coronavirus that  arises  out of the nature of their covered employment

•  Eligible individuals  are entitled to benefits, including disability  income, medical services, and  survivor benefits