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The CARES Act: How It Impacts Individuals and Families

by | Apr 2, 2020

On March 27, 2020, the CARES Act was passed, a $2 trillion stimulus package for individuals, families and businesses. For individuals and families, the Act includes, among other things, payments to individuals and families, expansion of unemployment coverage, changes to student loan repayment, and changes to retirement account rules. Below are a few highlights. For more specific information, go to

Stimulus Checks

  • Most adults will receive one payment of up to $1,200 but it will depend upon your adjusted gross income.
  • You should not have to apply for the payment. However, you will need to have filed a 2019 or 2018 tax return. The IRS will use this information to calculate the payment amount. The IRS announced on its website on March 30 that “People who typically do not file a tax return will need to file a simple tax return to receive an economic impact payment.” See
  • Single adults earning an adjusted gross income of up to $75,000 and up to $150,000 for married couples filing joint returns will receive the full payment.
  • Eligible taxpayers will receive up to $1,200 for individuals or $2,400 for married couples. For a qualifying child 16 years or under, parents will receive an additional $500.
  • Payments decrease if your income is greater than the above and stops for individuals earning more than $99,000 or $198,000 for joint filers with no children.
  • An adult who is claimed as a dependent by another is not eligible for payments.
  • According to the Treasury Secretary Steven Mnuchin, the payment will be made via direct deposit and should arrive within the next three weeks. The individual should get a paper notice in the mail no later than a few weeks after the payment was disbursed. The notice will inform the individual where the payment ended up and how it was paid. If the individual cannot locate the payment at that point, the individual should contact the IRS using information on the notice.
  • Even if your income exceeds the caps for a stimulus check, there may be other provisions in the legislation that may apply including filing for unemployment or one of the various loans for small business owners or sole proprietors.
  • For more information, visit (More information at IRS website

Expanded Unemployment Benefits

  • Unemployment claims are expanded to include self-employed and part-time workers.
    • The amount you may receive depends upon the state.
    • If you utilize a school, daycare or another facility to care for a child, elderly parent or other household member in order to work and that facility has been shut down due to coronavirus, you may be eligible for unemployment benefits.
    • Individuals affected by self-quarantine or are unable to get to work may also be eligible for unemployment benefits
    • Those who are not eligible for unemployment are individuals who are able to work from home and those who receive paid leave or paid family leave.
  • For more information, visit

Student Loans

  • Through September 30, 2020, the federal government has imposed automatic payment suspensions for student loans held by the federal government.
  • The bill also provides that interest shall not accrue on the loan during the suspension period.
  • It is advisable to check with your specific loan service provider.

Retirement Accounts

  • During the calendar year 2020, no individual will have to take a required minimum distribution from any individual retirement account or employer retirement savings plan (e.g. 401(k)). This does not affect pensions.
  • Individuals can withdraw up to $100,000 this year without the usual 10% penalty as long as the reason for the withdrawal is for COVID-19. Income taxes on the distribution amount will be spread over 3 years from the date you take the distribution. Individuals can put the money back into the account before the three years is up. This exception applies only to coronavirus-related withdrawals. An individual qualifies if the individual tests positive, a spouse or dependent test positive or the individual experienced a variety of other negative economic issues related to the COVID-19 pandemic.
  • Individuals can take loans up to twice the regular amount under certain circumstances. Usually loans are maxed at one half of the balance but the bill suspends that rule. For 180 days after the bill passes, you are able to take out a loan up to $100,000.

Insurance Coverage

  • The bill requires all private insurance plans to cover COVID-19 treatments and vaccine and makes all COVID-19 tests free.

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