New stimulus package: Biden unveils free preschool, community college, paid leave, child tax credits

WASHINGTON (NewsNation Now) — President Joe Biden unveiled his next $1.8 trillion stimulus package on Wednesday focusing on universal preschool, free community college, national paid leave program and child care spending caps. In his American Families Plan, Biden will also roll out a series of tax hikes to pay for the program.

Many of the proposals listed below require Congressional or state buy in to be enacted.

As NewsNation learns more about each of these proposals and reactions from both sides, this story will be updated.

For all or most Americans

  • Introduce legislation to reform unemployment insurance to automatically adjust the length and amount of benefits unemployed workers receive depending on the economy
  • Extend expanded Affordable Care Act premium tax credits, which were added to the previous American Rescue Plan
  • Make the Earned Income Tax Credit Expansion for childless workers permanent, to pull low-wage essential workers out of poverty
  • Give IRS authority to regulate paid tax preparers to deal with some preparers with high error rates, which costs taxpayers large fees

For students

For parents

  • Affordable child care — creating a sliding scale where families earning 1.5 times their state’s median income will pay 7% or less on child care
  • National paid family and medical leave program — Up to $4,000 per month, with a minimum of two-thirds of average weekly wages replaced
    • In year one of the program, the plan includes three days of bereavement leave per year
    • By year 10, it will have increased to 12 weeks of paid parental, family and personal illness leave
    • This package would include partial wage replacement for a new child, care for seriously ill loved one, loved one’s military deployment, finding safety from sexual assault, stalking or domestic violence, heal from serious illness or taking time off for the death of a loved one
  • Extend the Child Tax Credit increase through 2025 and make it permanently fully refundable. This was expanded in the American Rescue plan to bring the credit from $2,000 to $3,000 per child for ages 6 and above and $3,600 child under 6.
  • Make the Child and Dependent Care Tax Credit (CDCTC) expansion from the American rescue Plan permanent
  • Expand summer EBT (Electronic Benefits Transfer) to all eligible children nationwide
  • Creating a reentry for formerly incarcerated individuals with Supplemental Nutrition Assistance Program (SNAP)

For teachers, schools and child care providers

  • $1.6 billion in funding to help current teachers earn credentials for programs like special and bilingual education
  • $2 billion for programs to mentor new teachers and teachers of color
  • Child care providers will receive funding to focus on the quality of early childhood care and education
  • A $15 minimum wage for child care workers (the average worker earned $12.24 per hour in 2020, according to The White House)
  • Funding for job-embedded coaching and professional development for child care providers
  • Incentives for schools to expand and provide healthy school meals

Tax increases

“The plan would cost $1.8 trillion and is proposed to be paid for through tax hikes on high income Americans, impacting .03% of taxpayers, like those making more than a million dollars a year.”

Senior White House officials
  • Increase top tax rate to 39.6% to the top 1%. This was cut under the Trump administration to 37%
  • End capital income tax breaks — households making over $1 million will pay 39.6% on all income, including capital gains and dividends
  • Eliminate “loophole” where gains can be passed down across generations untaxed by ending the practice of “stepping up” by taxing if the property is not donated to charity. However, there would be protections for family-owned businesses and farms.
  • Close the “carried interest loophole” making hedge fund partners pay ordinary income rates
  • Eliminate the special real estate tax break, allowing real estate investors to defer taxation when they exchange property with gains higher than $500,000
  • Permanently extend limitation that restricts large, excess business losses to allow tax cuts
  • Ensure equality of Medicare taxes on high-income workers and investors by forcing those making over $400,000
  • Increased enforcement on wealthy taxpayers making over $400,000, corporations, businesses and estates

What’s not included

  • Direct economic payments or stimulus checks
  • Student loan cancellation

Coronavirus Stimulus

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