Brad and Jonathan breakdown the stimulus package that is part of the recently passed CARES Act.
Brad has a few silver linings during this crisis all about human connection
- Texted an old friend and reconnected
- His family had a few Zoom calls with extended family
- His daughter’s elementary school teachers had a 40 car parade
Shout out not only to the Accidental Homeschoolers out there but also to the teachers who have had to flip all their curriculum to fit a virtual system almost overnight.
The Stimulus Package
Your stimulus check will arrive automatically, there is nothing you need to do.
- Singles: If your income is below $75,000 you will receive a $1,200 stimulus check.
- Married filing jointly: If your income is below $150,000 you will receive $2,400.
- You will also get $500 per dependent child under 17
- Teens 17-23 who are claimed as a dependent on someone else’s return do not qualify for the $500 or their own stimulus
Single people who earn more than $99,000 and married couples filing jointly who earn over $198,000 will not receive a stimulus check.
If you earn between $75,000 and $99,000 for single people (or between $150,000 and $198,000 for married), your check will be reduced $5 for every $100 you earn over the threshold.
Your income is based on your 2018 tax return unless you have already filed your 2019 return. If you have already filed then your 2019 return will be used.
General advice, if your income went up in 2019 over 2018, you may want to hold off on filing your taxes so the rebate is based on 2018. And vice versa, if you made less in 2019, go ahead and file so your rebate will be based on your 2019 income.
- There is a $300 charitable deduction that you can qualify for even if you did not itemize
- All required minimum distributions have been waived for 2020
- You can take up to $100,000 from a traditional or Roth IRA and you may be able to avoid the 10% early withdrawal penalty (consult with a professional on this)
- For businesses that earn more than $75,000, the employer portion of self-employment taxes can be deferred with half due on December 31st, 2021 and the other half due December 31st, 2022
The Paycheck Protection Program
Any business with under 500 employees may be eligible for the Paycheck Protection Program.
You can borrow up to 2.5 months of payroll (based off your average payroll paid between March 1st 2019 and Feb 29th 2020) to continue paying out payroll.
Here’s the kicker: The loan can be forgiven. The loan will be forgiven up to the amount spent on payroll in the eight weeks following receipt of the loan.