3 minutes reading time (532 words)

CARES Act Stimulus Summary

The Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law on March 27, 2020. This is a $2 trillion emergency fiscal stimulus package to help reduce the economic damage caused by the virus and “stay at home” policies. The following is a summary of the main provisions for individuals.

Recovery Rebates:

  • The CARES Act provides for recovery rebate checks of up to $1,200 for individuals with adjusted gross income (“AGI”) up to $75,000 ($2,400 for joint filers with AGI up to $150,000) plus an additional $500 for each child under the age of 17 for US taxpayers through an advance refundable tax credit against 2020 income taxes. There is a phase out of the rebate, which causes a $50 reduction in the rebate for every $1,000 of AGI above these thresholds. For example, individuals with no children having an AGI of more than $99,000 and married couples with no children filing jointly having an AGI of more than $198,000 would be phased out completely and receive no recovery rebate check. The advanced payment of the recovery rebates will be based on the AGI reported on tax returns filed for 2019, and if no such tax return has been filed for 2019, the AGI reported on the 2018 filed tax returns will be used.
    • The rebate check will be sent directly to the bank account on file with the IRS for your 2019 or 2018 tax return. If the account is closed or there is no account on-file then a check will be mailed.
    • You can receive the rebate if you are retired and receive social security or a pension as long as your AGI is within the limits listed above.

Retirement Accounts:

  • Required Minimum Distributions are waived in 2020 for all retirement type accounts (401K, 403B, 457, IRA and Beneficiary IRAs). If you already took part or all of the RMD you might have the option of returning them except for beneficiary IRA distributions.
    • We are waiting to hear more details on the charitable contributions that are paid with RMD funds and we will be in contact with those clients that make charitable contributions from their RMDs to let them know their options for 2020.
  • Individuals under age 59 ½, may take coronavirus-related distributions from qualified retirement plans (IRA, 401K) of up to $100,000 without the distributions being subject to the 10% early distribution tax. The distributions are still subject to federal income tax, but the tax owed can be spread over three years.
    • In order to get these favorable terms, you will have to prove that you were adversely affected by the coronavirus.

Unemployment:

  • Regular unemployment payments, which are about 55% of your normal pay are increased by $600 per week for a maximum of 4 months. The benefit period is also extended by 13 weeks. It is normally 26 weeks maximum in California, so it can now go to 39 weeks.

There are also several small business and self-employed benefits provided by the CARES Act. We recommend that you discuss with your accountant or business manager the different options and if you should apply and take advantage of them.

Hope you are staying safe, sane, and healthy!

Record Retention: Keep it or Toss it
New Tax Deadlines

By accepting you will be accessing a service provided by a third-party external to https://assetplanninginc.com/

Search Blogs Module

Wait a minute, while we are rendering the calendar
policy investment statements tax deadlines trustee fun atmosphere toilet paper retirement plans retirement accounts 70 1/2. Federal Trade Commission website borrowing money Medicare plan donation counts Independence Day insurance policy California Lions Friends DNA test kits Facebook profile CARES Act interest rates Social Security blog post executive order client portal CERTIFIED FINANCIAL PLANNER exam business hours EEChecklist-Kits.pdf stockpilingchecklist.pdf VOIP landline phones Social Security Administration September 9 rescue organizations pet industry fun facts privacy settings hurricane Dorian CA FTB retirement planning chip-enabled EMV cards pet Kraig Mathias health care costs documents retirement 20 year anniversary money check lists TD Ameritrade IRS cell phones memorial Day weekend vacation consumer spending car loans clients show support https ://seekingalpha Roth IRA “ skimmer ”. Open House Labor Day 401K privacy notices April 11 credit freeze Retirement Contribution Limits president Trump phishing scams birth certificates July 4 email notifications Puerto Rico driver license emergency kit paper records checklists Victor Dergunov news coverage https :// spring cleaning contribution limit payments credit cards Expired medications cell phone SIM swap scam emergency folder COVID -19 virus credit score records market turmoil disaster areas 4 pm -8pm estate Two-Step Verification parking spots September 8 information self-help topics clone counterfeits tax deadline Medicare question 2018 IRA contributions life saver illiegal robocallers Orange County scams asset Planning non-prescripstion sunglasses identity theft Medicare Advantage 2017 Equifax breach wells Fargo home emergency kit October 1 2020. pet supplies April 15 offering insurance water … 900 number Legal robocalls Wells Fargo customers Open Enrollment banking 23 andme Part B years spread Supplemental Security Income paperwork clutter stimulus package Mobile Banking Security Tips National Ice Cream month ice cream vision screening IRA accounts prescription eyeglasses home mortgages tax filing deadlines flash drive ice cream event FEMA website padlock app student loans Medicare Part B tax records ID card items Orange County Superior Court insurance policies estate planning direction partner /owner health care services trust information Facebook earnings fallout summer September 30 2020. interest web address Financial Planning Magazine Part D premiums . assets phone companies Asset Planning stock pile integral member D premiums February 14 settlement options holidays approach pets identity thieves people medications Fox News story earthquake app Affordable Care Act CFP ® Wells Fargo employees jury duty Medicare Part B premiums notary services donation items team members FSA emergency kits card reader Shred paperwork fees cell phone carriers Flexible Spending Account April 18 2017. credit monitoring service Healthcare tax season 2017 IRA contributions cell phone service provider home home break-ins relief efforts Auto insurance gap insurance Amazon Medicare spam phone credit card fraud Erin Nelsen June 29 operations manager tax returns Joey Gonzales house sitter pet donation drive July 3 rd clients Brexit vote Coronavirus Aid credit card company phone official certification portal phishing sites IRS deadline drive /usb coronavirus company Notary Public cell phone provider Charles Schwab Ice Cream Social Economic Security cell phone carriers offer opt-out increase July weekend 2017 TD Ameritrade National LINC Conference media accounts markets estate planning text messages breach family members home security home emergency preparedness kits Treasury Department Kiplinger Letter January 10 account numbers debt July 6 bottom line