Quote from Savings Beagle on April 16, 2020, 9:56 am

The federal coronavirus relief bill – CARES Act – is primarily known for its $1,200 payments to most Americans and its Paycheck Protection Program provisions.

You can read more about those provisions and other government and business relief efforts in our post "Coronavirus Related Changes, Offers and Deals."

There are other parts of the legislation, though, that may provide additional help to Americans facing difficult times as a result of coronavirus and its related government-mandated shutdowns.

Below are some of the lesser-known, but likely beneficial to many, provisions of the CARES Act.

CORONAVIRUS RELIEF BILL PROVISIONS

BANKRUPTCY

Current bankruptcy law requires a repayment time limit of five years. The bill extends the repayment time frame to seven years, and provides that people who file for bankruptcy don’t have to use relief payments to repay past debt.

CREDIT REPORTING

The bill requires lenders that allow deference or skipped payments to report borrowers as current on their payments even if they are not. This ensures that even though, technically, consumers are not paying on-time, their credit won’t be negatively affected. Be aware, though, you must talk with your lender about deferral or skipped payment options and receive their agreement to do so before actually missing payments.

MORTGAGES

The bill requires companies that service federally backed mortgages – a category the majority of mortgages fall into – to grant forbearance of up to 360 days to borrowers who say they have been harmed by the coronavirus outbreak.

Foreclosures and processing foreclosure-related evictions are prohibited for 60 days beginning March 18, 2020.

Owners of multifamily properties can request forbearance of up to 90 days…during this time, tenants cannot be evicted for nonpayment of rent or other fees.

RETIREMENT

Rules governing hardship distributions from retirement accounts are temporarily loosened to allow individuals affected by the coronavirus pandemic to withdraw up to $100,000 from retirement savings without the normal 10% penalty.

401(k) loan amounts are doubled to the lower of $100,000 or 100% of the account balance over the next six months.

And mandatory distributions for 2020 are suspended.

TAXES

Individuals who don’t itemize deductions are able to claim up to $300 for charitable contributions.

There are a number of business-focused provisions that should help ease cash-flow problems. A few include:

Businesses are able to apply losses from 2018, 2019 or 2020 to past years’ profits and claim refunds.

Restaurants and retailers should discuss with their tax professionals a change that addresses depreciation deductions on renovations.

Employers are able to defer paying their share fo 2020 payroll taxes, making those payments in 2021 and 2022.

There are more business tax changes in the bill of which most tax professionals should be aware. If you’re a business owner, definitely inquire if any of those changes will benefit you.

WRAP UP

The coronavirus relief bill included a wide variety of provisions primarily focused on helping individuals and businesses weather this Covid-19 crisis.

The problem, as is found with most pieces of legislation, is that there is so much included in the bill that lesser know provisions are missed until a thorough combing of the language is done.

Some of the provisions above may prove very helpful to Americans as we move through the economic crisis created by coronavirus.

Not having skipped payments reported to the credit bureaus, being able to miss mortgage payments should finances require it and relief from foreclosures and evictions for a period of time may, unfortunately, come into play for a number of Americans over the coming months. It’s good these provisions were included in the bill.

Others, especially being able to tap retirement funds, are not ideal. If you have no other choice, I guess utilizing your retirement monies penalty free during this period is a positive. But, please, make this an absolute last resort option.

If you’re aware of other coronavirus relief provisions we’ve missed, please let us – and other readers – know in the comment section below.

Please share this post with others who may benefit.