Economic Assistance for Individuals and Small Businesses
On Friday, March 27th the House passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act, a historic $2 trillion relief package to get financial help to families and workers, stabilize our cascading economy, and help the American people and our nation’s health care workers confront the COVID-19 pandemic head on.
Cash Assistance for Americans
NEW (4/9/20): the IRS plans to open a new, online portal the week of April 13 for economic impact payments.
The portal will allow taxpayers, once authenticated, to find out the status of their economic impact payments and, if no payment or check has been issued, they can provide their banking information for direct deposit. The portal will be similar to the Where’s My Refund portal that is available for taxpayers to track the status of their federal tax refund. No other updates may be provided through the portal.
Individuals making up to $75,000 ($150,000 for married workers) will receive payments of $1,200 with an additional $500 payment per minor child. The payments decrease for single workers making more than $75,000 annually ($150,000 for married couples) and stop altogether for single workers making more than $99,000 ($198,000 for married workers and $218,000 for a family of four.)
These payments will be issued by the IRS via direct deposit and will be based on 2019 or 2018 tax return or 2019 Social Security statement.
If someone has not filed a tax return in 2018 or 2019 and does not receive Social Security benefits, the IRS recommends filing a 2018 or 2019 return to receive payment. If the IRS does not have the taxpayer’s bank account information, the taxpayer should look for a letter from the IRS detailing how to receive their payment.
If you receive Social Security, retirement or other social safety net benefits, you may still qualify for direct payments. These payments will not be taxable nor represent “resources” for program eligibility purposes. Click HERE for more information from the IRS.
You can also find a list of helpful FAQs from the House Committee on Ways and Means by clicking HERE.
Expanded Unemployment Benefits
In response to the record number of Americans who have lost their jobs due to the coronavirus pandemic, Congress included a major expansion of Unemployment Insurance (UI) benefits in the CARES Act. The CARES Act provides $260 billion for unemployment insurance, including an additional $600 weekly for every American receiving unemployment benefits.
You can find a helpful guide prepared by the House Ways and Means Committee Staff about new unemployment insurance benefits under the CARES Act by clicking HERE.
You can also find a helpful chart prepared by the House Ways and Means Committee Staff about timing for unemployment benefits by clicking HERE.
You can also find more information or file a claim on the California Employment Development Department’s website.
Assistance for Small Business
Congress provided $350 billion in forgivable loans and $10 billion in grants to small businesses, tribal business concerns, and certain nonprofits.
Loans through a new SBA 7(a) Paycheck Protection Program can be forgiven when used for payroll costs (including paid leave, health care, and other costs) to retain workers, and other expenses such as rent, mortgage interest, and utilities. Independent contractors, sole-proprietors, and other self-employed persons are eligible for these loans.
For additional information regarding resources for small businesses, visit the House Small Business Committee
Assistance for Student Loan Borrowers
Under the CARES Act, Congress mandated the following:
Suspension of Interest on Federal Student Loans: All loans owned by the U.S. Department of Education will have interest waived. That includes Direct Loans, as well as Federal Perkins Loans and Federal Family Education Loan (FFEL) Program loans held by the Department of Education. The interest will be suspended and individuals are not required to do anything.
Forbearance of Federal Student Loans: To provide relief to student loan borrowers during the COVID-19 national emergency, federal student loan borrowers can be placed in an administrative forbearance which allows students to temporarily stop making their monthly loan payment until September 30, 2020. Should a student want to request an administrative forbearance, they should contact their loan servicer.
Loan Recalculation: Many individuals have had dramatic changes in their income as a result of the coronavirus outbreak and its impact on businesses across the country. For any student who experiences a significant change in income, the monthly payment can be recalculated at any time. To have a loan recalculated, contact your loan servicer.
Restrictions on negative credit reporting and involuntary collections: The Department of Education will stop collection actions and garnishing the wages of borrowers who are behind on their student loan payments.
Should you have questions about loan payments whether you qualify for suspended interest or administrative forbearance, contact your loan servicer. If you do not know who your servicer is or how to contact them, click HERE or call 1-800-4-FED-AID (1-800-433-3243; TTY for the deaf or hearing-impaired 1-800-730-8913) for assistance.
To learn more about the ways Congress is supporting student borrowers through the Department of Education, click HERE.