|The $2 trillion bipartisan coronavirus legislation, known as the CARES Act, is more than twice the size of America’s biggest economic stimulus package, President Barack Obama’s 2009 Recovery Act. It’s also more than twice the size of America’s biggest corporate bailout, President George W. Bush’s 2008 Wall Street rescue. Keep in mind, the immediate goal is to help families and businesses survive, not jumpstart economic activity – that part will come later and may require yet another gargantuan stimulus. The most vital piece of the package provides $150 billion for hospitals and other health entities. Below are more details about what’s in the CARES Act: |
FYI, I heard some talk amongst the more powerful people I know that U.S. small business owners could soon be able to go to their bank and get some type of government payroll relief. As of writing this last night, the Senate had passed the bill but the House still had to make changes and vote. From what I understood last night, you would be able to get 200 to 250 times your February 15th payroll in order to help owners keep the paychecks flowing for the next couple of months as we fight to get pass the virus. This would be a huge bailout for most small business owners and really help ease the pain. There was some talk about the specific details and how it would ultimately have to be paid back, but for the most part it sounds very promising. There was also talk that business owners might be able to get the funding electronically to help patrons at banks that have fully closed their physical locations. As long as the government makes the money easy for the small business owner to get it should go a long way to helping provide immediate support.
Direct payments: Americans will receive a one-time direct deposit of up to $1,200, and married couples will get $2,400, plus an additional $500 per child. The payments will be available for incomes up to $75,000 for individuals and $150,000 for married couples. This is true even for those who have no income, as well as those whose income comes entirely from non-taxable, means-tested benefit programs, such as Social Security.
Use of retirement funds: The bill waives the 10% early withdrawal penalty for distributions up to $100,000 for coronavirus-related purposes, retroactive to Jan. 1
The unemployed: The program’s extended unemployment insurance program — “unemployment on steroids,” as Sen. Chuck Schumer calls it — expands eligibility and offers workers an additional $600 per week for four months, on top of what state programs pay. It also extends Unemployment Insurance benefits through Dec. 31, and allows furloughed workers to stay on as employees. The deal extends to gig economy workers.
Large corporations: $500 billion will be allotted to provide loans, loan guarantees, and other investments, overseen by a Treasury Department inspector general. These loans will not exceed five years and cannot be forgiven…
Small businesses will get $367 billion in loan guarantees while workers have to stay home. Companies with 500 employees or fewer that maintain their payroll during the downtime can receive up to 8 weeks of cash-flow assistance.
Payroll taxes: The measure allows companies to defer paying their 2020 payroll taxes through the end of 2022. They will have to pay 50% by the end of 2021.
Hospitals and health care workers: The deal injects $100 billion into hospitals and the nation’s health system, and billions more into providing personal and protective equipment for health care workers, testing supplies and increased workforce and training.
Coronavirus testing: All testing and potential vaccines for COVID-19 will be covered at no cost to patients.
Agriculture: The deal would increase the amount the Agriculture Department can spend on its bailout program from $30 billion to $50 billion.
Airlines will receive $25 billion (of the $500 billion) for passenger air carriers, and $4 billion for cargo air carriers.
States and local governments will get $150 billion, with $8 billion set aside for tribal governments.
Schools: The final package provides more than $30 billion in emergency education funding for colleges and universities, states and school districts. (Sources: Politico, Axios, CARES Act)