On March 27, 2020 Congress passed landmark legislation, the CARES (Coronavirus Aid, Relief, and Economic Security) Act, to help the economy continue to operate during the Covid-19 (Coronavirus) pandemic. The legislation consists of many parts including cash stipends to most Americans who filed tax returns in 2019 (or 2018, if individual has not yet filed their 2019 return), as well as economic relief for businesses to continue conducting business and keeping people employed.
Businesses, small business specifically (defined as >500 employees) can qualify for a loan equal to 2.5 months payroll and operating costs or $10M, whichever is less. As long as the funds are used to keep employees on payroll or used to rehire employees to previous working levels, the loan will convert to a grant and the business will not have to repay the loan.
For individuals, one-time payments will be sent out to eligible individuals; eligible meaning anyone who is a legal resident, who doesn’t earn too much, and anyone who is not claimed as a dependent by someone else.
Payments will be granted as such:
- $1,200 payment to individual taxpayers
- $2,400 payment for married couples filing jointly
- An additional $500 per qualifying child under the age of 17
The money is NOT a loan and does not have to paid back. Usage is left at the discretion of the individual, with no limitations on how the fund are spent. Individuals whose adjusted gross income exceeds $75,000, or $150,000 for joint filers do not qualify. Heads of Household (single person with dependents) with an AGI over $112,500 do not qualify as well.