Checklist for Individuals Navigating Covid-19 Pandemic Aid and Relief
(Updated March 30, 2020)
Many individuals and families are concerned about keeping up with their monthly bills, running out of cash, and otherwise covering immediate expenses. There is a patchwork of aid and relief available to address these concerns. The Coronavirus Aid, Relief, and Economic Security Act (CARES ACT) was enacted into law on March 27, 2020. It provides certain assistance to individuals in meeting the economic challenges they face right now from the Covid-19/Corona Virus Pandemic. In addition, New York State has issued a series of emergency orders and regulations providing additional relief. The situation is fluid. The following is a checklist of some of the aid and relief the Firm has learned is available so far.
Cash from the US Government
Under the CARES ACT, the US Treasury is issuing checks to qualified individuals with Social Security Numbers based on 2019 or 2018 tax returns or Social Security benefits statements.
- $1,200 to single filers with adjusted gross income below $75,000.
- $2,400 to joint filers with adjusted gross income below $150,000.
- An additional $500 for each dependent under the age of 17.
- Benefits will phase out at higher income levels.
- Dependents over the age of 17 (including cared-for parents and disabled children) are not eligible for the direct payment.
You do not need to apply for these benefits, payments should arrive by the end of April, check with your tax advisor if you have questions about eligibility.
Cash from Unemployment Benefits Under the CARES ACT; for Gig Workers Too
- The duration of unemployment insurance benefits is extended by 13 weeks.
- Payments are increased by $600 per week for four months.
- Gig economy workers and the self-employed are eligible for unemployment benefits under the CARES ACT.
Cash from Your IRA
- The CARES ACT provides that individuals under age 59 1/2 can withdraw “Coronavirus-Related Distributions” from IRA or other retirement plans without the 10% penalty and repay these distributions back into their retirement accounts within three years, essentially an interest free loan. If not paid back, the distribution may be treated as taxable income for 2020 or spread out as taxable income over a three-year period. Before acting, talk to your tax advisor about how this works and whether this is an appropriate option for you.
Cash from Health Savings Accounts
- The CARES ACT provides that Health Savings Account (HSA) and Healthcare Flexible Spending Account funds may now be used to purchase over-the-counter medications.
Deferral of Student Loan Payments
- Payments on student loans are allowed to be suspended through September 30, 2020 without interest accrual or penalties.
- All associated involuntary debt collections are suspended for the same period, including wage garnishment or the reduction of tax refunds.
- If you are interested in this deferment, contact your loan service provider.
Deferral of Mortgage Payments
- The federal government and NYS have enacted rules to allow homeowners to defer mortgage payments without incurring penalties or bad credit marks.
- If you are interested in this deferment, contact your bank. The banks are making this relief relatively easy to secure but note, you can’t just stop paying without communicating with your bank.
- If you have a home equity loan, you may contact your bank about that as well.
Deferral of Property Taxes
- There is limited property tax relief for some homeowners in NY in the form of partial deferred payments. If you are interested in this deferment, contact your local tax authority for details about your eligibility.
Deferral of Life and Property Insurance Premiums
- NYS Department of Financial Services has adopted regulations allowing consumers experiencing financial hardship due to COVID-19 to defer paying life insurance premiums for 90 Days.
- NYS Department of Financial Services has adopted regulations allowing consumers and small businesses experiencing financial hardship due to COVID-19 to defer paying property and casualty insurance premiums for 60 Days.
- If you are interested in this deferment, contact your insurance provider.
Deferral of Auto Lease and Loan Payments
- A number of major automakers are offering short term lease and loan relief programs. J.D. Power has a list of current programs at:
- If you are interested in this deferment, contact your auto loan or lease company.
Assistance with Utilities
- Con Edison is not shutting off service for people having difficulty paying their bills during the Pandemic and is working with customers who need assistance on payment plans. Check Con Ed’s website for further information.
Assistance with Credit Card Payments
- While we haven’t seen any laws or emergency orders addressing credit card payments, we have learned that American Express and certain bank cards are working with their customers on a case by case basis. We do not know how this may impact credit scores and reporting or credit limits.
- If you are interested in this kind of assistance, contact your credit card company directly to see what kinds of programs they may have.
Evictions and Foreclosures Suspended
- New York State has implemented an indefinite moratorium on residential and commercial real estate evictions.
- The NY Office of Court Administration announced that foreclosures are non-essential service of the courts and therefore foreclosures are suspended.
- The IRS has moved the tax filing and payment deadline for individual returns to July 15, 2020.
- New York State has also moved its deadline for individuals to July 15, 2020.
- If you are owed a refund, you can still file early to receive it sooner.
- Contact your tax preparer now to start preparing your returns, don’t wait until July.
Beware of Scams
- The IRS won’t call you.
- Beware of suspicious phone calls and emails, don’t let your guard down.
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