Coronavirus Relief For Employees In The US
The whole country has been impacted by coronavirus - while we focus on our families and loved ones, the economy has taken a huge hit and many employees are in financial difficulty.
This guide offers details of the coronavirus reliefs available to full and part time employees.
1 - Stimulus Checks
The Senate passed the coronavirus stimulus package, the CARES Act, signed into law on March 27. The act will send $1,200 repayments and checks to eligible individuals and $500 for each child under the age of 17.
To be eligible, if you are single your adjusted gross income (line 8b of the 2019 1040 federal tax return) should be $75,000 or less. If you are married filing jointly the threshold is $150,000.
If your income exceeds the thresholds above, the repayment will be reduced by $5 for every $100 of income over the threshold.
Treasury Secretary Mnuchin has said that repayments will start to be issued in April. If you will receive a paper check, then the time scale may be up to 8 weeks.
This is a one off payment, it's not a monthly recurring payment - but given the current situation, it is likely that the government will announce further reliefs in the coming months.
Even if you owe past taxes, the repayment will still be issued to you.
The stimulus payments are not taxable and they will not be reclaimed if you are over the income threshold in the future.
Further details of the individual and married filing thresholds can be found here.
2 - Income Tax Deferments
The due date for 2019 tax payments has been extended from April 15, 2020 to July 15, 2020.
You can defer up to $1 million of federal income tax (including self-employment tax) by 90 days with no interest and no penalties.
If you believe you will have a refund, it still makes sense to file as soon as possible so you have the funds now.
The deferral is automatic, you do not need to make a claim.
Each state has its own reliefs and you can view the current guidance for each state here.
3 - Filing Deadline
The new deadline for filing federal returns is July 15, 2020
Each state has different views on extensions and you can view the current guidance for each state here.
4 - Unemployment Insurance
Employees who have been laid off because of coronavirus are eligible to claim unemployment benefits.
As part of the coronavirus relief package, an additional $1 billion has been set aside for unemployment benefits.
The CARES Act also provides an additional $600 per week for 4 months to eligible workers.
5 - New Paid Leave Law
The Families First Coronavirus Response Act (FFCRA) provides that employees are paid leave for specified reasons related to coronavirus.
Two weeks of paid leave at regular pay if the employee is quarantined or experiencing symptoms of Covid-19
Two weeks of paid leave at two thirds regular pay if the employee is caring for someone with coronavirus or caring for a child where the school or childcare facility has closed due to coronavirus
If you have been employed for at least 30 days, up to 10 additional weeks of paid leave at two thirds regular pay if the employee is caring for someone with coronavirus or caring for a child where the school or childcare facility has closed due to coronavirus
6 - Student Loans - Pausing and Interest
All federally held student loans will automatically have their interest rates set at 0% for a period of 60 days from March 13, 2020.
In addition, if you make a request, you can suspend all loan repayments for 2 months during the pandemic. There will be no interest or penalties by suspending the loan repayments.
The US Department of Education will continue to review the coronavirus situation to see if the measures need to be extended.
7 - Homeowners
If your mortgage is owned by Fannie Mae or Freddie Mac, you can delay payments for up to 12 months.
Interest will still apply to the balance of the mortgage outstanding, but there will be no late fees or affect on your credit score for delaying the payments.
Foreclosure and other legal proceedings for eviction are suspended - including any foreclosures and legal actions in process.
If your mortgage is held with other providers, you may still be able to defer payments by 3 to 12 months depending on the company.
8 - Renters
If landlords have mortgages with Fannie May or Freddie Mac, they will not be allowed to evict tenants during the crisis, through to the end of July 2020.
Landlords can not charge any fees or penalties for non-payment of rent during the pandemic.
Each state has it's own guidance for renters where the landlord does not have the mortgage with Fanny May or Freddie Mac - further details here.
9 - Household Bills
For internet and phone accounts, AT&T, Comcast, Cox, RCN, Sprint, T-Mobile and Verizon have all agreed they will not cut-off services during the crisis.
For electricity, gas and water - each company has its own policy, but the government has told them they need to work with consumers. For example, in New York, Con Edison has agreed to suspend all shutoffs for electricity and gas.
If you are experiencing financial difficulty, the first step is to contact the company and ask what reliefs they have in place.
SUMMARY
These measures cover the next 3 months and it is likely that further measures will be provided. The IRS has a dedicated page for support for those affected by coronavirus here.