The CARES Act is a $2.2 trillion dollar stimulus and disaster relief package that provides funding to help deal with the unprecedented economic impact resulting from the COVID-19 virus. (Here’s all 852 pages if you are interested.)
Bill components include stimulus payments to individuals, expanded unemployment coverage, student loan changes, different retirement account rules and more. Applications are required for some of the biggest programs to determine eligibility are as follows:
- Paycheck Protection Program – $349 billion
- Expanded Economic Injury Disaster Loans – $10 billion
- USDA Corona Virus Response – $9.5 billion
- Commodity Credit Corp. (USDA) – $14 billion
For individuals and families, the CARES Act:
- Provides a direct cash rebate of up to $1,200 per taxpayer and $500 per child
- Expands eligibility for Unemployment Compensation to those who are not usually eligible, including those who are self-employed and independent contractors
- Provides an additional $600 per week to each recipient of Unemployment Compensation for 4 months and extends benefits for those whose benefits were scheduled to expire
- Defers student loan payments on Federally-backed student loans and stops interest accrual for 6 months
- Waives the tax on seniors who elect not to take the Required Minimum Distribution from their retirement accounts in 2020
- Limits evictions for renters and foreclosures for homeowners with Federally-backed mortgages
- Ensures COVID-19 testing is covered by all private insurance plans without cost sharing
The CARES Act also provides $376 billion in relief for small and medium-sized businesses and nonprofits through:
- Paycheck Protection Program: Provides loans to employers to maintain payroll. If payroll is maintained, the loan is forgiven.
- Emergency Economic Injury Grant: Provides an advance, which does not need to be repaid, of up to $10,000 within 3 days of applying for an Economic Injury Disaster Loan.
- Small Business Debt Relief Program: Provides immediate relief with non-disaster loans and microloans.
- Tax Provisions: Provides employee retention credit for employers subject to closure or economic hardship through a refundable payroll tax for 50% of wages and delays payment of employer payroll taxes.
Also please note the new income tax filing and payment deadline extension. The federal tax return filing deadline is now July 15, 2020, including for tax payments of up to $10 million.
First Here’s the Big Picture
Next Individual Aid & Debt Management
Then Business Aid & Debt Management