Broker Check

Breaking Down the $2 Trillion Stimulus Package

April 02, 2020

I want to start off by saying thank you to all of the healthcare professionals who are leading this fight against COVID-19. I could not be prouder of my wife who walks into her NYC hospital each day ready to help the countless individuals who have contracted this deadly virus, all while putting her own health at risk. It does not go unnoticed. 

Everyone has been affected by COVID-19, whether you’ve been infected by the virus or not. We’ve seen a massive shutdown of all “normal” life activities, from going to work to walking in the park, and everywhere in between. In my worst nightmare I don’t think anything like this has happened; everyone mandated to stay home, and those that need to go out are walking around with masks and gloves on because they don’t want to contract a deadly virus.

But – We will get through this.

 

The United States government has responded to the global pandemic by passing the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which is a $2 trillion stimulus package in order to help the American people and small businesses.

I want to highlight some of the features of the stimulus package that may be pertinent to our clients, friends, and family members.

A one-time $1,200 payment

  • Individuals who had up to $75,000 in adjusted gross income in 2019 will receive a one-time payment of $1,200
  • Married couples with AGI up to $150,000 will get $2,400
  • If you qualify for the above, you will also receive $500 per child
  • Individuals or families above the income limit will see their benefit reduced by $50 for every $1,000 above the threshold

Retirement Planning

  • Suspension of required minimum distributions (RMDs) for 2020
    • 2020 RMDs can also be returned if you have already taken them
  • No 10% penalty for withdrawing from a retirement account prior to age 59.5
    • Income taxes can be spread out over three years (since these are pre-tax) instead of paying them immediately upon withdrawing the money
    • You also have three years to recontribute the amount back that you took out to make up for it

Unemployment Compensation

  • There will be an increase of $600 per week for unemployment benefits for up to four months
  • Benefits will be expanded to more individuals that would otherwise not qualify, such as self-employed individuals and independent contractors
  • The normal one-week waiting period is waived 

Student Loans

  • Federal student loan payments are deferred through September 30, 2020

  

Positivity and acts of kindness are needed right now. Do your part and we will get through this together. If you have a specific question or you’d like clarity on a particular issue, feel free to reach out. I’d be happy to help. 

Robert.A.Gariano@ceterafs.com

 

Fun Fact: A 2013 study by an online retailer in the UK showed that a child can ask an average of 300 questions per day. The hardest reported question that was asked was,"Why is water wet?"