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CARES Act Breakdown - The Coronavirus Stimulus Bill

CARES Act Breakdown - The Coronavirus Stimulus Bill

April 06, 2020

We hope you have been staying safe and healthy over these past few weeks.  We just wanted to provide an update on the recently passed stimulus bill, the "Coronavirus Aid, Relief, and Economic Security Act" (AKA the CARES Act).  The purpose of the $2 trillion, 883-page bill is to provide relief to individuals, families, businesses, and communities most affected by the coronavirus.  Below is a detailed summary of the provisions in the bill.

As always, we are here for you, so please call or email if you have any questions or concerns.

Last but certainly not least, please continue to stay safe and healthy by practicing persistent hand hygiene and social distancing.


Strata Financial Group


CARES Act Breakdown:

Individuals and Families

  • $300 billion in cash payments.  Checks will be sent to individuals and families based on the following income and tax filing status:
    • Single
      • Income of $75,000 or less will receive $1,200 + $500 per child.
      • Income between $75,000 and $99,000 will receive a reduced amount.
      • Income more than $99,000 will not receive a check.
    • Married Filing Jointly
      • Income of $150,000 or less will receive $2,400 + $500 per child.
      • Income between $150,000 and $198,000 will receive a reduced amount.
      • Income more than $198,000 will not receive a check.
    • $260 billion in extra unemployment payments (this amount is subject to change based on the number of unemployment claims), which includes:
      • $600 per week will be added from the federal government on top of what the state normally pays for unemployment.  The extra $600 will last for four months.
      • 13 weeks of unemployment insurance.  Unemployment benefits can be extended up to 13 weeks beyond the normal limit.
  • A new, temporary Pandemic Unemployment Assistance program will help self-employed, freelancers, and contractors who can’t apply for unemployment.
  • Employers can provide up to $5,250 in tax-free student loan repayment benefits, which means employees would not have to include that money as income.
  • All private insurance plans are required to cover COVID-19 treatments and vaccines and not charge for coronavirus tests.
  • 2020 Required Minimum Distributions will be waived for IRAs and 401(k) plans.
  • The 10% early withdrawal penalty will be waived for individuals under age 59.5 for any withdrawals up to $100,000 from any retirement account.
  • The 2019 tax filing deadline has been extended to July 15th.

Small Businesses (500 or fewer employees)

  • $10 billion for grants of up to $10,000 to provide emergency funds for small businesses to cover immediate operating costs.
  • $350 billion allocated for the Small Business Administration (SBA) to provide forgivable loans of up to $10 million per business.
    • Any portion of the loan used to maintain payroll, keep workers on the books, or pay for rent / mortgage / existing debt could be forgiven, provided workers stay employed through the end of June.
  • $17 billion to cover six months of payments for existing SBA loans.

Big Businesses

  • $58 billion to help airlines stay open, allocated as follows:
    • $25 billion for passenger airlines
    • $4 billion for cargo airplanes
    • $3 billion for airline contractors
  • Any company receiving a loan under the program is prohibited from making stock buybacks for the term of the loan plus one year.

ALL Businesses

  • Fully refundable tax credit for businesses that are closed or distressed to help them keep workers on the payroll.  The credit covers 50% of payroll on the first $10,000 of compensation, including health benefits, for each employee.
    • For employers with MORE than 100 full-time employees, the credit is for wages paid to employees when they are NOT providing services because of the coronavirus.
    • Eligible employers with LESS than 100 full-time employees can use the deduction even if they aren’t closed.

Public Health

  • $100 billion to hospitals responding to the coronavirus.
  • $1.32 billion in additional funding to community health centers around the country.
  • $11 billion for diagnostics, treatments, and vaccines.
    • Includes $80 million for the Food and Drug Administration to prioritize and expedite approval of new drugs
  • $4.3 billion to CDC programs and response efforts.
  • $20 billion to support healthcare for veterans.
  • $16 billion to the Strategic National Stockpile to increase availability of equipment, including ventilators and masks.

Public Assistance

  • $8.8 billion for schools to have more flexibility to provide meals for students.
  • $15.5 billion in additional funding for food stamps to help cover the expected increase in applications as a result of the coronavirus.
  • $450 million to food banks and other community food distribution programs.

State and Local Governments

  • $339.8 billion to state and local governments, including:
    • $274 billion toward specific COVID-19 response efforts.
      • $150 billion of which will be for direct aid for state and local governments running out of cash due to high number of cases.
    • $5 billion for Community Development Block Grants
    • $13 billion for K-12 schools
    • $14 billion for higher education
    • $5.3 billion for programs for children and families, including child care centers


  • All student loan payments and interest will be deferred through September 30th without penalty to the borrower for all federally owned student loans.