The first order created “payroll tax holiday” until the end of 2020 for Americans making less than $100,000 a year. The Executive Order reads, “The Secretary of the Treasury is hereby directed to use his authority pursuant to 26 U.S.C. 7508A to defer the withholding, deposit, and payment of the tax imposed by 26 U.S.C. 3101(a), and so much of the tax imposed by 26 U.S.C. 3201 as is attributable to the rate in effect under 26 U.S.C. 3101(a), on wages or compensation, as applicable, paid during the period of September 1, 2020, through December 31, 2020. (a) The deferral shall be made available with respect to any employee the amount of whose wages or compensation, as applicable, payable during any bi-weekly pay period generally is less than $4,000, calculated on a pre-tax basis, or the equivalent amount with respect to other pay periods. (b) Amounts deferred pursuant to the implementation of this memorandum shall be deferred without any penalties, interest, additional amount, or addition to the tax”.
President Trump also stated that he would like to possibly eliminate payroll taxes altogether if he gets a second term. “If I’m victorious on November 3rd, I plan to forgive these taxes and make permanent cuts to the payroll tax. So I’m going to make them all permanent“.
The second Executive Order deals with student debt relief by suspending loan payments and temporarily setting interest rates to 0 percent. “This relief has helped many students and parents retain financial stability. And many other Americans have continued to routinely pay down their student loan balances, to more quickly eliminate their loans in the long run. During this time, borrowers have been able to determine the best path forward for themselves“.
A third executive order extended a moratorium on evictions for homeowners with federally backed mortgages. “My Administration has taken bold steps to help renters and homeowners have safe and secure places to call home during the COVID-19 crisis. It is the policy of the United States to minimize, to the greatest extent possible, residential evictions and foreclosures during the ongoing COVID-19 national emergency. The Secretary of the Treasury and the Secretary of Housing and Urban Development shall identify any and all available Federal funds to provide temporary financial assistance to renters and homeowners who, as a result of the financial hardships caused by COVID-19, are struggling to meet their monthly rental or mortgage obligations“.
The most notable Executive Order Trump signed, extended federal unemployment payments to American families struggling with COVID-19-related job loss. However, it reduced the $600 a week payment to $400. The President said the reason for the reduction in the amount was to ensure the cash didn’t act as a “disincentive” toward getting back to work.
“I am hereby directing the Federal Emergency Management Agency (FEMA) to assist in providing benefits from the DRF, and am calling upon the States to use their CRF allocation, to bring continued financial relief to Americans who are suffering from unemployment due to the COVID-19 outbreak,” the Executive Order read.
“To provide financial assistance for the needs of those who have lost employment as a result of the pandemic, I am directing up to $44 billion from the DRF at the statutorily mandated 75 percent Federal cost share be made available for lost wages assistance to eligible claimants, to supplement State expenditures in providing these payments. At least $25 billion of total DRF balances will be set aside to support ongoing disaster response and recovery efforts and potential 2020 major disaster costs“.
These Executive Orders bypass Congress where leaders have been at an impasse over negotiations. Democrat leaders wanted far more than just economic relief for citizens. President Trump remarked on the negotiations, “We have repeatedly stated our willingness to immediately sign legislation providing expanded unemployment benefits, protecting families from eviction and providing relief payment to families”. He added, “Democrats have refused these offers. What they really want is bailout money for Democrat governors and mayors that have been run very very badly for many years”. Trump also stated that the Democrats wanted “the mass release of inmates, including serious felons,” and stimulus checks to illegal aliens. “They have things in there nobody has had the time to look at or read. These people, I honestly don’t believe they love our country,” he said in regards to Senator Chuck Schumer (D-NY) and House Speaker Nancy Pelosi (D-CA).