Understanding the CARES Act during COVID-19

"Sticking your head in the sand does not prevent the tide from coming in" -K.J.

We are in unchartered water......

As in any "unchartered territory" we don't know what is around the corner. We can, however, stay calm and kind and make the best decisions for us and our families with the information we have. That information may change daily...and that's okay. We will get through this and by becoming educated on what is available to us we may eek out of this even better than you had imagined.

The CARES Act, passed and became public law on 3/27/20

Boss Ladies and Friends, I wanted to take this newsletter to highlight some of the key components of the CARES Act and how it can affect you and your business. These are highlights-I will be posting a Podcast today and I HIGHLY recommend you listen in if you are 1. Concerned about money in this situation or 2. A business owner of any sort (sole proprietor, LLC, non-profit, etc). I will also highlight some of the bank programs out there on the podcast. Highlights of the CARES Act: IMPORTANT to note: None of the following require a personal guarantee nor will they harm your credit (so long as you follow the rules). Everything below is effective immediately, though be patient as our government (regardless which side you areon) is dealing with this as quickly as they can-but there will be errors, delays and other frustrating events....be patient. ALL benefits require that you are both filing and paying taxes (both for yourself and your business). No tax filing? No benefits. Haven't done it yet-get off your ass and go use this time to do your taxes-it's what I am doing, too!

  1. One time payment-Americans (who pay taxes) will receive a one time payment in the next month or two of $1200 (for singles under $75,000 income) or $2400 (joint filers with income under $150,000). You will get an additional $500 per dependent under the age 17.

  2. Unemployment benefits-this applies to W2's, self-employed, gig-employees AND 1099's. This has never before happened in our history. But you can apply for unemployment and get up to an additional $600 per week for up to four months. Just beware, systems are backlogged and they are working on this.

  3. PPP Loans and Small Business Grants-I will go WAY deep into this on the podcast, but any type of business, including non-profits and sole-proprietors, so long as you file taxes, can apply for a Paycheck Protection Program Loan to cover staff wages, rents and other qualified expenses. This loan is FORGIVABLE (MEANING YOU LIKELY DON'T HAVE TO PAY IT BACK) so long as you are paying for the things you are suppose to. This is to help our economy stay alive. I recommend you apply for this whether you need it today or not-again, more on this on the podcast. Additionally, businesses can apply for a one-time $10,000 grant (free money).

  4. Payroll taxes can be delayed until 2021 & 2022.

  5. Retirement plans (I do not recommend this unless you are literally facing foreclosure or something terrible...try to avoid this): Waiver of 10% penalty for distributions on retirement plans up to $100,000. Withdrawals are still taxed but taxes spread out over three years. RMD's suspended for those over age 72. Additionally, you may now take a loan on your 401k of up to $100,000 (was $50,000 before COVID-19).

  6. Increased limits on "above the line" contributions to non-profits (meaning you can deduct contributions even if you don't itemize so go help your non-profits if you can.

  7. Net Operating Loss rules have been modified.

  8. No cost or COVID-19 tests for individuals needing testing.

  9. Additional benefits under state, city and county governments for individuals and businesses.

  10. Delay tax filings until 7/15/20.

  11. Student loan payment suspension with no interest or penalties accruing through Sept. 2020.

  12. Federally backed mortgages MUST postpone mortgage payments for up to 180 days if asked by individuals affected by COVID-19.

  13. Foreclosure moratorium for at least 60 days.

  14. Eviction relief for renters (if owner has a federally backed mortgage) for up to 120 days. Friends, this is INCREDIBLE and you need to be utilizing many of these tools if you are affected. Let's beat this virus physically, emotionally, spiritually and financially. I believe in you. You got this. Links to listen to podcast about all of the programs available: Spotify iTunes Stitcher iHeartRadio TuneIn



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