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What is the CARES (Coronavirus Aid, Relief, and Economic Security) Act?

In this week's Arista Advice, Paul L. Moffat of Arista Wealth Management discusses the CARES Act Coronavirus economic relief plan.

Full Transcript: 

Hello, welcome to Arista Advice. Hope you’re well and are safe and healthy as we all fight this COVID-19.

Question of the week is – Paul, can you give some insight on the Families First and the CARES Act. Let me give you some insight. For an individual earning up to $75,000/year or a married couple earning up to $150,000, they each get a $1,200 credit, thus $1,200 or $2,400 and $500 per child.

Number two – the rebate check decreases $5 per $100 of earned income. Thus if you make up to $99,000/year that $1,200 rebate check is evaporated, and earned married joint is $198,000.

Another provision, because of COVID-19 and because of section 72(t), they can take money out up to $100,000 a year from their qualified retirement accounts and their IRAs and not have to pay any penalty or disrupting their 72(t).

Another provision is that if you have an IRA, inherited IRA, 401(k), 403(b), 457, there is no RMD in 2020 enabling you to keep the money in your account and potentially grow tax-free or tax deferred.

Another provision, the deadline for your 2019 tax return to file is no longer April 15th it’s now been pushed to July 15th. You can also then do a late filing and an extension all the way to October 15th.

And the final provision is that if you have a federal student loan those interest rate payments have been abated for 12 months in 2020.

Hope this is helpful. Give us a call. We’re here to guide and lead you through the COVID-19. Have a great day.