And how can it help you and your family?
In March of 2020, in response to the economic downturn caused by the ongoing pandemic, The United States legislature passed a historic act designed to help the many stakeholders affected. This included individuals/families, small/medium businesses, industries and various health care providers.
The problem is that everyday people often don’t know what this act means for them. That’s why we’ve highlighted the provisions most commonly available to most Americans. Please read on to learn about them.
Unemployment Benefits Expansion (FPUC & PUA)
The FPUC Program extended benefits to freelance and gig workers affected by the pandemic – workers who weren’t previously covered. The PUA Program tacked on an extra $600 per week in addition to current unemployment benefits. This goes through July 31st. Please visit your state’s unemployment website to determine your eligibility.
If your state benefits happen to run out, you’re now eligible for 13 weeks of additional unemployment insurance. You’ll still have to meet unemployment insurance requirements of being able and seeking work, but depending on when you became unemployed these benefits could last until the end of 2020.
The Paycheck Protection Program (PPP)
This provision allows businesses to borrow money from the government in order to cover operating costs such as overhead, payroll, rent, utilities, etc. This benefits both small businesses and its employees. These funds are “loans” in the sense they can be forgiven if the businesses use these funds to cover the outlined expenses above. One stipulation however is that business does not reduce the average number of employees 8 weeks after it received the loan. This is good for businesses and employees alike, as it provides cash flow and stability.
Penalty Free IRA Borrowing
If you have a retirement account, you can now borrow from it interest free. This would normally garner a 10% penalty, but it has been waived to allow people to access funds that may help them avoid financial hardships.
American families and individuals are eligible for tax credits of $1200 per taxpayer and $500 per child. Starting at annual income of $75,000, the rebate begins decreasing.
These benefits will happen automatically if you have federally backed student loans. Payments are being postponed and all interest waived during this time. If you’ve already made payments after March 13th, you can request a refund.
Forbearance is the same thing as postponement. Under this provision, if you have a federally backed mortgage and are experiencing financial hardship due to the pandemic, you are eligible for Mortgage Forbearance.
As mentioned above, this article only highlights the most common provisions of the act. The entirety is quite broad and it’s important that you’ve properly educated yourself before applying for certain program benefits. To learn more about The CARES Act, please visit the U.S. Department of Treasury website here: https://home.treasury.gov/policy-issues/cares/ .