In response to the economic impact of the COVID-19 pandemic, on March 27, 2020 President Trump signed into law the Coronavirus Aid, Relief, and Economic Security Act (the “CARES” Act). A few of the key benefits to individuals and businesses under the CARES Act are outlined below:
- Stimulus Checks: Though couched as a credit against calendar year 2020 taxes, up to $1,200.00 for individuals and $2,400.00 for married couples will be issued as a refund of a “deemed” overpayment of taxes for calendar year 2018. Up to an additional $500.00 per each qualifying child is also available.
- Expanded Unemployment Benefits: Though experiencing numerous technical difficulties, the unemployment benefits available in Florida have been increased for eligible individuals by $600.00 per week (through July 31, 2020), an additional 13 weeks of benefits have been added to Florida’s regular benefits period, and self-employed individuals and others not otherwise qualified may now receive unemployment benefits. Employment search requirements have also been relaxed (visit floridajobs.org/COVID-19 for more information).
- Paycheck Protection Program (“PPP”): As of this writing, the Senate passed additional funding under the PPP. The House is expected to also approve this additional funding. Qualifying businesses may borrow from a qualified lender a specified sum based on eligible payroll costs. The interest rate is 1%, and all of the loan may be forgiven if at least 75% of the loan was used for eligible payroll costs. Eligibility for Economic Injury Disaster Loans was also expanded under the CARES Act (visit sba.gov or home.treasury.gov for more information).
- Tax Filing: Filing and payment deadlines for 2019 income tax returns and 2020 first quarter estimated tax payments were extended to July 15, 2020 (visit irs.gov for more information),
- Mortgage Relief: Mortgage payment relief under federally backed mortgages may be available if experiencing financial difficulty due to coronavirus. Contact your lender for more information.
- Retirement Plan Relief: Qualifying individuals may withdraw up to a specified limit from IRA’s and 401(k) plans without penalty, and be given a three (3) year period to report the withdrawal as income. Required minimum distributions payable in 2020 may be entitled to an extension.
- Charitable Contributions: A new charitable contribution of up to $300.00 is allowed in addition to the standard deduction, and income ceilings have been lifted on charitable contribution deductibility.
- More Business Relief: An employee retention tax credit may be available to qualified businesses (maximum of $5,000.00 per employee), and qualified businesses and self-employed individuals may defer Social Security payroll tax payments.
Further information and other possible benefits under the CARES Act may be found on the Small Business Administration, IRS, U.S. Department of the Treasury and Florida Department of Economic Opportunity websites.