President Trump has signed into law a relief package that will inject roughly $2 trillion into an economy reeling from the coronavirus pandemic. It will include direct payments for Americans and funding for states and businesses.
The checks will be sent out automatically without your needing to do anything. However, those who normally aren’t required to file tax returns will have to file a basic tax return to get the money.
The Coronavirus Aid, Relief and Economic Security (CARES) Act is set to inject about $2 trillion into a U.S. economy reeling from the coronavirus pandemic. The Senate unanimously approved the emergency stimulus package. Shortly after the House passed the CARES legislation, said to be the largest U.S. stimulus effort ever, President Donald Trump signed it into law on March 27.
The New York Times reports the bill will encourage businesses that have temporarily closed to keep their workers employed. It will also expand unemployment insurance by 13 weeks and enhance benefits for four months, according to sources with knowledge of the bill. Additionally, it will provide unemployment benefits to gig workers and freelance workers.
IRS provides details on stimulus payments
Other details on the stimulus payments to Americans include:
- Single people whose tax returns show adjusted gross incomes of up to $75,000, and married couples filing jointly with adjusted gross incomes of up to $150,000, will receive the full stimulus amount of $1,200 for individuals and $2,400 for married couples. Those above those income thresholds will receive a reduced stimulus amount.
- Single people with income above $99,000 and joint filers without children and income above $198,000 are not eligible to receive the stimulus payments.
- The up to $1,200 payment for single people and up to $2,400 payout for couples will be based on tax returns for 2019, for those who have already filed, or for 2018 otherwise. Parents will also receive a $500 payment for each qualifying child. The money will be deposited into the bank account noted on your tax return.
- In case your bank account information is not available with your tax return, you can also provide it online through a portal that the IRS is setting up.
- Those who are required to file a return but failed to do so for 2018 or 2019 will need to file one to get their stimulus payment.
- Stimulus payments will be available through the end of 2020 in case you are concerned about a delay in filing your tax return.
See related: Best ways to use your stimulus check
CFPB asks banks to work with coronavirus-affected consumers
The Consumer Financial Protection Bureau on March 26 said it would be flexible with banks as they work with their customers during the coronavirus crisis. The CFPB is putting on hold some of the reporting that banks are required to provide the agency, including reporting related to credit card accounts.
“As consumers seek temporary relief from lenders, the pandemic is impacting the operations of financial companies that are eager to help their customers during this unprecedented time,” CFPB Director Kathleen Kraninger said in a March 26 statement. “Our actions today are temporary and targeted to support consumers by allowing financial companies to focus their resources on assisting consumers.”
The CFPB’s advisory comes as initial claims for unemployment insurance soared to 3.283 million for the week ending March 21. According to the Department of Labor, this is the highest level ever for this statistic, surpassing the previous high of 695,000 set in October 1982. The claims are up from 282,000 for the previous week, largely on account of the coronavirus-related layoff impact.
Earlier this month, various federal and state financial institution regulators, including the CFPB, issued a directive asking financial institutions to work with consumers who need financial help as a result of the pandemic.
Initial relief package includes paid leave
Congress approved emergency funding on March 18 to combat the coronavirus panic, and Trump signed it into law.
This aid will reportedly provide paid leave for impacted workers, broaden the scope of unemployment insurance, provide “nutrition assistance” and more resources for testing. This legislation was passed by a big majority.
Americans can delay tax payments
Treasury Secretary Steven Mnuchin announced March 20 that Americans have until July 15 to file their taxes. But Mnuchin encouraged those who expect refunds to file as soon as they could.
The July 15 extension applies no matter how much a taxpayer owes, and no interest or penalties will be assessed during that period.
Student loan borrowers can suspend payments
Trump announced on March 20 that borrowers of federally-backed student loans could suspend payments for two months, and that all of these loans would automatically have their interest rates set to 0% for at least 60 days.
Making cash access available
In another stimulus effort, the Treasury is investing money to enable the Fed to guarantee up to $1 trillion in the commercial paper market, Mnuchin said. This market is critical to U.S. businesses, workers and savers, and this plan will address “liquidity issues.”