All of your stimulus bill questions answered
As the days and weeks have progressed since Governor Cuomo’s orders for social distancing, Boris Benic and Associates continues to work separately, but with a unified purpose: supporting our clients through a most unusual situation.
The last week in March, Congress passed the CARES Act, a $2 trillion coronavirus economic stimulus bill that will provide economic relief for individuals and businesses most adversely impacted by the health crisis.
The IRS started sending out the individual stimulus checks outlined in the CARES Act this week. But, as with many tax-related issues, there’s a little ambiguity. Here’s what you need to know.
- The payments will be available for those with incomes up to $75,000 for individuals and $150,000 for married couples.
- People who’ve already filed their 2018 or 2019 tax returns and authorized the IRS to make a direct deposit will receive the first batch of checks.
- Those who have not filed their taxes can provide their bank information using the U.S. Treasury’s webpage.
- Those who have filed, but not authorized electronic payment can either wait for a mailed check or update their bank information on the IRS’ Get My Payment page. This service will also provide the status of an individual’s stimulus payment.
Other key provisions included in the bill that might be important to you as an individual include:
- Unemployment: The bill makes major changes to unemployment assistance. It provides $250 billion for an extended program, increasing the benefits and broadening who is eligible.
- Use of retirement funds: The bill waives the 10% early withdrawal penalty for distributions of up to $100,000 for coronavirus-related purposes. Withdrawals will still be taxed, but taxes will be spread over a three-year period.
- 401(k) Loans: Loan limits have been increased from $50,000 to $100,000.
For small businesses, the bill makes it easier for companies to keep employees on the payroll and remain in business. As we’ve covered in earlier communications, there are also emergency grants and a forgivable loan program – these require your immediate attention.
- Emergency grants: There is $10 billion for grants of up to $10,000 to provide emergency funds for small businesses to cover immediate operating costs. If you haven’t already applied for the Economic Injury Disaster Loan (EIDL), we recommend doing so as soon as possible on the SBA website.
- Forgivable loans: There is $350 billion dedicated to preventing layoffs and business closures while workers have to stay home during the outbreak. You can apply for the Payroll Protection Loan Program (PPP) with your business banking relationship.
- Relief for existing loans: There is $17 billion to cover six months of payments for small businesses already using SBA loans.
- Payroll tax credits: Businesses with under 500 employees can begin taking advantage of two new refundable federal payroll tax credits, designed to immediately and fully reimburse them, dollar-for-dollar, for the cost of providing coronavirus-related leave to their employees. New York state also has a required paid leave policy, which you can review here.
There’s so much still happening since the CARES Act passed a couple of weeks ago.
We know you may have questions, but rest assured our staff at Boris Benic and Associates is available by phone, email, text, and video chat to provide answers.