The spread of the COVID-19 virus has affected our health, our lives, and even our wallets. The pandemic brought with it a surge of layoffs as companies rushed to cut their expenses, leaving many Americans without a serviceable source of income.
As many as 23 million people were forced to file for unemployment, the pandemic not only affecting those who were laid off, but also those who were incapable of applying for regular unemployment benefits.
This included those who were self-employed, those who ran nonprofit organizations, and those who preformed contract work. During the start of the pandemic, many people found themselves at a loss with how to deal with their finances.
In response to the adverse effects the pandemic had on American workers, the IRS made the decision to offer tax refunds to those affected by unemployment. As stated in the American Rescue Plan Act, those who received unemployment checks wouldn’t be required to pay taxes for them or have them counted as earned income during the pandemic.
As stated by the US Department of Labor, “states are permitted to provide Pandemic Unemployment Assistance (PUA) to individuals who are self-employed, seeking part-time employment, or who otherwise would not qualify for regular unemployment compensation.”
Under this relief program, those who paid their taxes with unemployment benefits will be eligible to have their money automatically refunded. Additionally, the March stimulus has allowed for a weekly $300 dollar bonus in unemployment payments, as well as boosting the child tax credit to $3600 per child.
Although a temporary solution to a much bigger problem, the 2020 tax refunds have provided much-needed support to many Americans’ finances. Although some might argue that this will only help the economy in the short term, we don’t have the luxury of thinking of long-term goals at this time.
Our goal as a country right now shouldn’t be to tend to the needs of the economy, but to tend to the needs of those most affected above all else. With the availability of vaccines, we can only hope we’ll soon be able to start rebuilding our economy in a post-COVID world.