With the Senate reaching an agreement on the Coronavirus Aid, Relief, and Economic Security (CARES) Act, there has been a push to consolidate resources for easy reference and education on what the aid the Act provides.
The U.S. Senate Committee on Small Business and Entrepreneurship created this Small Business Owner’s Guide to the CARES Act as a detailed resource on the programs and initiatives available to small businesses, employers, and some non-profit organizations. Within the Guide are details on qualifications and how to apply for the various types of grants and financial relief offered under the CARES Act. The structure of this Guide allows viewers to easily navigate to the type of information they are seeking by topic, including Paycheck Protection Program Loans, Economic Injury Disaster Loans, Small Business Counseling, and more.
Additionally, CRES real estate attorney Mark Carlson of the Carlson Law Group has provided this shorter overview of what the CARES Act contains as a quick reference:
- Large corporations: $500 billion is available for loans to large corporations in certain industries. Airlines will receive $58 billion of that.
- Direct payments: Americans who pay taxes will receive a direct-deposit of up to $1,200 for individuals and $2,400 for married couples. A payment of $500 per child in the household will also be made. Those earning more than $99,000 individually or $198,000 for married couples will not receive a payment.
- Unemployment: $250 billion is available for an extended unemployment insurance program. Unemployed workers can receive $600 per week for four month in addition to state benefits. These benefits are available through 2020. Self-employed, independent contractors and “gig” workers are also eligible.
- Small business relief: $350 billion is available to preventing layoffs and business closures. Companies with 500 employees or fewer that maintain their payroll can receive up to 8 weeks of cash-flow assistance through interest free loans. A credit of up to 50% of wages paid will be available toward payroll taxes paid.
- Payroll taxes: Employers may defer their portion of 2020 payroll taxes through 2021 and 2022.
- Use of retirement funds: The 10% early withdrawal penalty for distributions up to $100,000 is waived for coronavirus-related purposes. This applies retroactively to January 1. Income tax on the withdrawals may be spread over three years and will not be due if the money is rolled back into the 401k.
- 401(k) Loans: The loan limit is increased from $50,000 to $100,000
- RMDs suspended: Required Minimum Distributions from IRAs and 401(k) plans are suspended.
- Charity. Charitable contributions are now an “above the line” deduction and the limits changed.
- Tax Treatment Changes: The Tax Cuts and Jobs Act (TCJA) net operating loss rules are modified. T he 80% rule on net operating losses is lifted, and losses can be carried back five years. Excess loss limitations are suspended in part. Interest expense limitations are increased to 50%.
- Hospitals and health care: $140 billion is available in grants to support the health care system.
- Coronavirus testing: Testing for and vaccinating against COVID-19 is covered at no cost to patients.
- States and local governments: $150 billion is available to State and local governments to help replace lost tax revenue.
- Agriculture: $50 billion is available to farmers and ranchers.
- Universities and schools: $30 billion is available to universities and schools to offset lost tuition and to cover remote learning costs.
- Restaurants/Hotels: Restaurants and hotels who made capital improvements can file amended tax returns and claim credits for those prior expenses to obtain refunds.
- Distillers: Alcohol distillers are exempt from excise taxes for the alcohol they produce to be used in hand sanitizers.
Real estate professionals across the country are realizing the benefits of having access to legal advice 7 days a week. CRES clients have access to the CRES ClaimPrevent™ Legal Hotline 7 days a week to review contracts and provide experienced advice on specific transactions to help avoid claim situations. You can learn more about CRES coverage and how it compares here or by contacting us 1-858-618-1648.
More COVID-19 Resources for Real Estate Agents
*These regulations are are fluid and can and have changed. Consult with your tax or financial advisor for the most up to date information.
