Relief Legislation Measures to Know | Adviser Investments

Relief Legislation Measures to Be Aware Of

On March 27, the federal government passed the Coronavirus Aid, Relief and Economic Security (CARES) Act. It is intended to dull the economic blow that this virus has and will continue to dole out to families and the nation.

Here are some relevant provisions of the CARES Act to know about, along with links to more detailed information in the Investing for Life section of our website:

  • Direct Payments to Taxpayers: Congress has authorized one-time payments of up to $1,200 per individual taxpayer, plus an additional $500 for each qualifying dependent child. The payouts are tied to your income level—higher earners are phased out. Click here to read more and find out if you qualify.
  • Required Minimum Distributions Waived: The bill waives required minimum distributions (RMDs) for 2020. In short, any retiree who’d prefer not to withdraw money out of their retirement accounts in a down market (and who isn’t relying on RMDs to pay current expenses) doesn’t have to. The waiver applies to a broad range of retirement accounts, including traditional IRAs, SEP IRAs, SIMPLE IRAs, inherited IRAs, 401(k) plans, 403(b) plans and government-sponsored 457(b) plans. For more details, click here.
  • COVID-19 Penalty-Free Withdrawals: Individuals directly impacted by the coronavirus are eligible to withdraw up to $100,000 from their retirement accounts penalty-free. Furthermore, the mandatory federal withholding requirement of 20% is also suspended from these distributions. Be aware, however, that the distribution is still subject to ordinary income tax. Click to read about qualifying events and more.
  • Robust Unemployment Benefits: With skyrocketing unemployment, the federal government has added a slew of benefits as part of the CARES Act, including bumping unemployment compensation up by $600 per week for four months. The Act eliminated the one-week waiting period that typically comes with filing for unemployment, allowing individuals to begin receiving benefits immediately.
  • Small Business Relief: Virus-impacted businesses of up to 500 employees will be able to take out a loan of up to $10 million, which may be forgiven if that loan is used for payroll and other business expenses. The Act has also suspended the employer portion of the Social Security payroll tax to begin on January 1, 2021. Here’s more from the Treasury Department.
  • And More: Our CARES Act blog post also discusses virus-related charitable contributions, Medicare provisions for retirees and student loan relief.

It’s a lot to take in, and there’s already talk of more legislative action to come. We’ll provide more insights as the intricacies and impacts of these legislative measures become clearer. If you have any questions regarding how the CARES Act may impact you or someone you know, please contact your wealth management team. We’re here for you.

About Adviser Investments

Adviser is a full-service wealth management firm, offering investment managementfinancial and tax planningmanaged individual bond portfolios, and 401(k) advisory services. We’ve been helping individuals, trusts, institutions and foundations since 1994. Adviser Investments and its subsidiaries have over 5,000 clients across the country and over $8 billion in assets under management. Our portfolios encompass actively managed funds, ETFs, socially responsible investments and tactical asset allocation strategies, and we’re experts on Fidelity and Vanguard mutual funds. We take pride in being The Adviser You Can Talk To. To see a full list of our awards and recognitions, click here, and for more information, please visit www.adviserinvestments.com or call 800-492-6868.


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