The House late on May 15 voted 208 to 199 to pass a $3 trillion ‘Phase Four’ COVID-19 relief bill that would provide additional economic assistance to individuals and businesses. While the Congressional Budget Office has not yet released an estimate of the budgetary cost of the entire legislation, the House Democratic bill includes nearly $1 trillion for state and local governments that have been impacted by the economic effects of the pandemic and over $1 trillion in tax reductions, partly offset by tax increases.
H.R. 6800, the Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act, includes numerous tax provisions that generally extend or expand ‘Phase Three’ tax provisions enacted in late March as part of the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act). However, the House-passed bill would narrow the scope of CARES Act net operating loss (NOL) relief provisions for corporations and pass-through businesses.
Passage of the House Democrats ‘HEROES Act’ marks the beginning of increased focus on Phase Four legislation to provide relief for individuals and businesses from COVID-19 economic disruption. While the Senate is not expected to immediately respond to the House bill, bipartisan concerns over the economic effects of COVID-19 make it likely that the Trump Administration and Congress will take action on a significant ‘Phase Four’ relief package in coming weeks.