10 Ways The Government Stimulus Bills Might Impact Your Personal Finances

During the month of March, Congress passed multiple bills aimed at mitigating the economic impact of COVID-19 and putting money into the economy. The stimulus is an effort to provide support for families, individuals, and businesses in order to prevent the economic slowdown from becoming a collapse. The CARES Act, about $2 trillion in total, is the largest economic stimulus legislation in American history since the New Deal back in the 1930’s.

Here are some of the highlights:

  1. The federal income tax deadline for filing 2019 tax returns has changed from April 15 to July 15, 2020. The deadline for making 2019 IRA and HSA contributions has also been moved to July 15, 2020.

  2. The CARES Act includes a provision to send most Americans direct payments of $1,200, or $2,400 for joint filers, plus $500 for each child (depending on your household income).

  3. The program provides $250 billion for an extended unemployment insurance program and expands eligibility and offers workers an additional $600 per week for four months, on top of what state programs pay.

  4. Required minimum distributions (RMDs) from some retirement accounts for 2020 have been waived.

  5. Workplace Retirement distribution rules are relaxed: The 10% early withdrawal penalty will be waived on aggregate distributions of up to $100,000. 401(k) Loan repayments may be delayed an extra year.

  6. Paid leave is required for more employees by the Families First Coronavirus Response Act.

  7. The CARES Act suspends payments on federal student loans for 6 months. The act waives any interest on the loans for 6 months as well.

  8. The CARES Act allows for a $300 above-the-line deduction for cash charitable contributions made to 501(c)(3) organizations for taxpayers who take the standard deduction.

  9. Small business relief in the form of the Payroll Protection Loan or Tax Credits for Employers who retain staff.

  10. Coronavirus testing: All testing and potential vaccines for COVID-19 will be covered at no cost to patients.

This list is by no means comprehensive; You can read more about the full qualifications and details on congress.gov under S.3548 - CARES Act

Joe Sweeney