By Carolyn Bahm
The U.S. government is trying to help Americans struggling with the economic impact of the coronavirus pandemic and how health precautions related to it have shut down so many businesses.
The fallout from COVID-19 (the disease caused by the virus) is cascading through the country’s economy, creating job losses, temporary layoffs and reduced work hours, thus affecting people’s abilities to pay their mortgages and other living expenses.
On March 27, a $2.2 trillion stimulus package became law as the “Coronavirus Aid, Relief, and Economic Security Act,” or the “CARES Act,” also known as Public Law No. 116-136.
It’s the largest economic relief bill in U.S. history, according to the Tax Foundation (a leading independent tax policy nonprofit organization operating since 1937).
People are already eagerly anticipating the relief money that will come directly to U.S. citizens, but the bill also responds in other ways to the coronavirus’s impact on the economy, public health, state and local governments, individuals and businesses. In part, those other measures include:
- Expanding unemployment benefits
- Providing money for heavily impacted hospitals and health care providers
- Giving financial assistance to small companies
- Allocating $500 billion in loans for distressed companies
Summary of the bill
The bill provides FY2020 supplemental appropriations for federal agencies to respond to the COVID-19 outbreak. The supplemental appropriations are designated as emergency spending, which is exempt from discretionary spending limits.
The bill also:
- Funds various loans, grants, and other forms of assistance for businesses, industries, states, local governments, and hospitals
- Provides tax rebates of up to $1,200 per individual and an additional $500 per child, subject to limits based on adjusted gross income
- Temporarily expands unemployment benefits
- Suspends payments and interest on federal student loans
The bill includes several other provisions that modify a wide range of programs and requirements, including those regarding:
- Oversight of the activities and funding authorized by this bill
- The tax treatment of withdrawals from retirement accounts, business income, losses, and charitable contributions
- Medical product supplies
- Health insurance coverage for COVID-19 testing and vaccinations
- Health care and aviation workforces
- Mortgage payments, evictions and foreclosures for properties with federally backed mortgages
- Student loans and financial aid
- Aviation excise taxes
- Medicare and Medicaid
- The Food and Drug Administration drug approval process
- The emergency paid sick leave program
- Banking and accounting rules
- The U.S. Postal Service’s borrowing authority
The website VisualCapitalist.com has a clear, easy-to-understand breakdown of where all the funds are going: https://www.visualcapitalist.com/the-anatomy-of-the-2-trillion-covid-19-stimulus-bill/.
According to that website, fund distribution includes:
- Individuals/families, 30%, or $603.7 billion
- Big business, 25%, or $500 billion
- Small business, 19%, or $377 billion
- State and local government, 17%, or $340 billion
- Public services, 9%, or $179.5 billion
Want to know the details, including restrictions and requirements? Read the actual act. You can see an online index linking to all parts of the act at https://www.congress.gov/bill/116th-congress/house-bill/748/text.
Some of the bill’s sections of interest to the average citizen include:
- Unemployment assistance for workers, families and businesses: Title II, sections 2101 through 2116
- Credit protection during COVID-19: Section 4021
- A moratorium on foreclosures: Section 4022
- Forbearance of residential mortgage loan payments for multifamily properties with federally backed loans: Section 4023 (In general, “forbearance” means the action of refraining from exercising a legal right, especially enforcing the payment of a debt.)
- Temporary moratorium on eviction filings: Section 4024