Rescue America Plan – Biden’s Stimulus Package

Dark Horse CPA

Joe Biden unveiled his $1.9 Trillion stimulus package last week. In this episode, Dark Horse’s CEO, Chase Birky, dives into the proposed economic relief measures and provides insight as to what may need to change for this proposal to become a bill.

Podcast Transcript

the tax made simple, where we break down the complex and the ambiguous in a digestible  fashion so that you can make informed decisions. Tax is made simple, is brought to you by  the tax and accounting wizards at dark horse CPAs. Well, you’re stuck with this ugly mug  today as I’m going solo for this episode. 

But I promise you, I will make it worth your time. If you’re interested in the new  stimulus package, dub D rescue America plan that Biden unveiled last week. What I want to  talk about today is exactly what he’s proposing and where we think things will land. When  these proposals make their way into a buyable bill. 

If you’re watching this on YouTube, you should definitely click the link below to  subscribe to the podcast. If you’re listening to the podcast and you haven’t yet subscribed,  come on, man. Drink the dark horse Kool-Aid and sign up. Okay. So you heard about it and  you either thought finally, or here we go again, the market’s heard about it and they said,  

Hmm, sounds inflationary. 

Let’s increase interest rates. The bottom line is that this proposal has an  astronomical price tag of $1.9 trillion after the 900 billion that was authorized under the last  bill in December. And where does Biden want this money to go? First of all, he wants to do a  new round of $1,400 stimulus checks. 

This would be per person, including dependence, regardless of age, between this  check and the one from December, a family of five would get a check for $10,000. If they  qualified for the full amount. The math is $600 from the first check plus $1,400 per person  under the Biden proposal multiplied by five. 

If that family supports a grandparent who may claim as a dependent, that check  becomes $11,400. Next, he wants to increase the federal unemployment bonus to $400 a  week from its current level of $300 a week and extend it through September of this year.  This would continue to include self-employed folks. 

And those facing displacement from their home would benefit from an extension  to the eviction and foreclosure moratorium through September, as well as $30 billion to help  low-income families who have lost their job, pay their rent and utilities. He also wants to  increase the child tax credit from $2,000 per child to $3,000. 

And if the child is under age six, the family will get an additional $600. The credit  would be refundable to which it currently isn’t in additionally he’s requesting $40 billion in  grants to support childcare centers and essential workers with meeting their childcare costs  on the business. Front Biden is proposing allocating $35 billion for guarantees of up to $175  billion in low interest loans meant for small businesses, which is typically meant those under  500 employees, an additional 15 billion would be allocated for grants to these same small  businesses.

He wants to require employers of all sizes to offer up to roughly 14 weeks of paid  sick and family leave. This would include those caring for sick family members. The weekly  benefit amount would be as much as $1,400 per week. Employers with under 500  employees would likely receive tax credits to cover the cost of the sick pay. 

Also, he wants to increase the federal minimum wage to $15 an hour. And for  reference sake, the current minimum wage is $7 and 25 cents an hour. Then there’s 350  billion for state and local governments, 170 billion for schools, 20 billion for vaccinations and  testing. And well, you get the point. This bill is going to be expensive. 

Everyone has a different opinion on how much and where the money should go.  However, one thing is for sure. This spending will not simply be made up for by taxes on  increased economic activity. It’s going to come in the form of higher taxes and that will  happen. Trust me, just not this year is we don’t believe the Biden administration will cut off  its nose to spite its face. 

They will likely wait until the pandemic has subsided. And the economy has  recovered before implementing Biden’s tax plan, which will substantially increase taxes on  those making over $400,000. When it comes to the rescue America plan, we’re confident  that Democrats will concede or compromise on certain initiatives in order to avoid having to  pass this bill, all the, a budget reconciliation, which would be a time consuming process and  is not the correct format for some of these relief measures to avoid this, they will need 10  Republican votes in the Senate. 

So what are they likely to drop in order to get these votes? I would start with the  increase of the federal minimum wage to $15 an hour, because that wouldn’t be allowed to  be past the reconciliation. Anyway, the second concession they’d likely be forced into is a  reduction of the amount allocated to state and local governments. 

Republicans hate bailing out state governments, whom they find have created  large deficits due to mismanagement. Last some of the price tags of certain benefits will  have to come down. Maybe they won’t be able to do $400 a week in additional  unemployment temper. Maybe it will only last through June. 

It’s these types of concessions that Democrats will have to consider to move  quick on their overall agenda. So, like I mentioned earlier, subscribe to this podcast and our  YouTube channel. If you care about your business and your taxes, We’ve got this week, this  morning on YouTube, which is a weekly video designed to give you a short form, download  of the most important developments, affecting your business and your taxes. 

And then we’ve got taxes made simple, which you’re currently watching or  listening to, to help you make sense of all things, tax your CPA. Isn’t providing you with this  information unless they’re dark, where CPA, if you need to make the upgrade from a CPA to  a dark horse CPA, we’re ready for you. Head over to dark horse dot CPA to get started. 

Once again, that’s dark horse dot CPA. So thank you for watching TMS or taxes  made simple if you’re not into the whole brevity thing, because there’s TMI and then there’s  TMS. .

Keep Listening

What To Do About the 43.4% Capital Gains Tax Rate

4 Min

The Biden Administration will be doubling the long-term capital gains tax rat... Listen now

Restaurant Revitalization Fund Grant Program

3 Min

If you own a restaurant or bar, you need to be aware of the Restaurant Revita... Listen now

What Does the American Jobs Plan Mean for Taxes?

3 Min

Hint: You’re probably not going to like the answer...

... Listen now