Federal Stimulus Payment CARES Act

The CARES Act is short for the Coronavirus Aid, Relief, and Economic Security Act. President Trump signed the bill into law on March 27, 2020. The stimulus package offers $2.1 trillion in aid to individuals and businesses.

Eligible taxpayers who filed tax returns for either 2019 or 2018 will automatically receive an economic impact payment of up to $1,200 for individuals or $2,400 for married couples. Parents also receive $500 for each qualifying child.

Economic impact payments for Individuals and Families: What you need to know

Offering an online tool provided through the IRS that provides taxpayers a secure way to quickly find the status of their payment, and if needed, a way for taxpayers to add their bank account information in order to receive their economic impact payment.
If the IRS does not have your direct deposit information, share it through this tool to speed your Economic Impact Payment.

Track the status of a payment: This feature will show the user the payment amount, scheduled delivery date (via direct deposit or through paper check) and whether a payment has been scheduled. To utilize this tool, taxpayers will need to know their Social Security Number, Date of birth, and the Mailing address used on their tax return. It is useful to have a copy of their most recent tax return to speed up the process but not required.

Taxpayers needing to add their bank account information to speed receipt of their payment will also need to provide the following additional information: Their Adjusted Gross Income from their most recent tax return submitted (either 2019 or 2018), the refund or amount owed from their latest filed tax return, and their bank account type, account and routing numbers

Please Note: Get My Payment cannot update bank account information after an Economic Impact Payment has been scheduled for delivery. To help protect against potential fraud, the tool also does not allow people to change bank account information already on file with the IRS. A Spanish version of Get My Payment is now avaliable.

Online: https://www.irs.gov/coronavirus/get-my-payment

Espanol: https://sa.www4.irs.gov/irfof-wmsp/login?lang=es

Legal Services of Northern California is offering assistance in navigating unemployment benefits and COVID-19 stimulus payments. For questions or information regarding COVID-19, please contact Legal Services of Northern California by phone: (530) 345-9491 or use the following link:
www.LSNC.net

Offering one-time state-funded disaster relief assistance for undocumented adult immigrants impacted by COVID-19. An undocumented adult who qualifies can receive $500 in direct assistance. A maximum number of 2 adults per household will be eligible for a total of $1000 in assistance per household. A household is defined as individuals who live, shop, and prepare meals together. Individuals may begin applying on May 18, 2020. Assistance will be available until the funding is spent or until June 30, 2020, at the latest. Applicants will be considered on a first-come, first-served basis. Disaster relief application services and assistance are not guaranteed. Applicants may only seek application assistance with the organization(s) assigned to their county of residency.

To be considered eligible for this assistance, applicants must meet the following requirements:

-Undocumented immigrant living in California.

-Must be able to provide information that they, are an undocumented adult (person over the age of 18); are not eligible for federal COVID-19 related assistance, like the CARES Act tax stimulus payments or pandemic unemployment benefits; and have experienced a hardship as a result of COVID-19.

Individuals living in Butte and Glenn counties may apply by calling the California Human Development Corporation at (707)228-1338. Please be ready to provide information and documents that will verify your identity, home or mailing address, and showing that they have been impacted by COVID-19.

Please Note: The information provided to the nonprofit organization by an individual will only be used to confirm their eligibility and provide the assistance to them. No personal information (like name or address) will be given to any government agency. Only general information like age, gender, and preferred language will be shared with the State of California.

– To find organizations providing assistance in other regions of California, visit: https://bit.ly/3bMsxlw

 -Due to the high volume of calls, please expect a long wait time.

Check IRS.gov for the latest information: No action needed by most people at this time

News Release 03/30/20:

WASHINGTON – The Treasury Department and the Internal Revenue Service today announced that distribution of economic impact payments will begin in the next three weeks and will be distributed automatically, with no action required for most people. However, some seniors and others who typically do not file returns will need to submit a simple tax return to receive the stimulus payment.

Who is eligible for the economic impact payment?

Tax filers with adjusted gross income up to $75,000 for individuals and up to $150,000 for married couples filing joint returns will receive the full payment. For filers with income above those amounts, the payment amount is reduced by $5 for each $100 above the $75,000/$150,000 thresholds. Single filers with income exceeding $99,000 and $198,000 for joint filers with no children are not eligible.

Eligible taxpayers who filed tax returns for either 2019 or 2018 will automatically receive an economic impact payment of up to $1,200 for individuals or $2,400 for married couples. Parents also receive $500 for each qualifying child.

How will the IRS know where to send my payment?

The vast majority of people do not need to take any action. The IRS will calculate and automatically send the economic impact payment to those eligible.

For people who have already filed their 2019 tax returns, the IRS will use this information to calculate the payment amount. For those who have not yet filed their return for 2019, the IRS will use information from their 2018 tax filing to calculate the payment. The economic impact payment will be deposited directly into the same banking account reflected on the return filed.

The IRS does not have my direct deposit information. What can I do?

The Non-Filers Tool to Register for Economic Impact Payments is a web-based portal for eligible U.S. citizens or permanent residents who:
– did not file a tax return for 2018 or 2019 and who do not receive Social Social Security retirement, disability (SSDI), or survivor benefits or Railroad Retirement benefits. However, Social Security, SSDI and Railroad Retirement beneficiaries who have qualifying children under age 17 may use this tool to claim a $500 payment per child.
– did not file a tax return for 2018 or 2019 because they are under the normal income limits for filing a tax return (Singles filers who made under $12,000 and married couples who made less than $24,000 in 2019)

The portal allows eligible individuals to provide their banking information to the IRS online, so that individuals can receive payments immediately as opposed to checks in the mail. Apply online by visiting https://www.irs.gov/ and selecting the Non-Filers: Enter Payment Info Here button on the homepage. This will lead to a page with a link to the application form, directions on how to apply, and what information will need to be provided to complete the application.

I am not typically required to file a tax return. Can I still receive my payment?

Yes. People who typically do not file a tax return will need to file a simple tax return to receive an economic impact payment. Low-income taxpayers, senior citizens, Social Security recipients, some veterans and individuals with disabilities who are otherwise not required to file a tax return will not owe tax.

How can I file the tax return needed to receive my economic impact payment?

IRS.gov/coronavirus will soon provide information instructing people in these groups on how to file a 2019 tax return with simple, but necessary, information including their filing status, number of dependents and direct deposit bank account information.

I have not filed my tax return for 2018 or 2019. Can I still receive an economic impact payment?

Yes. The IRS urges anyone with a tax filing obligation who has not yet filed a tax return for 2018 or 2019 to file as soon as they can to receive an economic impact payment. Taxpayers should include direct deposit banking information on the return.

I need to file a tax return. How long are the economic impact payments available?

For those concerned about visiting a tax professional or local community organization in person to get help with a tax return, these economic impact payments will be available throughout the rest of 2020.

Where can I get more information?

The IRS will post all key information on IRS.gov/coronavirus as soon as it becomes available. The IRS has a reduced staff in many of its offices but remains committed to helping eligible individuals receive their payments expeditiously. Check for updated information on IRS.gov/coronavirus rather than calling IRS assistors who are helping process 2019 returns.

Supplemental Security Income recipients will receive automatic Economic Impact Payments

SSI Recipients will receive a $1,200 Economic Impact Payment with no further action needed on their part. The IRS projects the payments for this group will go out no later than early May. Many benefit recipients typically aren’t required to file tax returns . Those who receive Social Security retirement, disability (SSDI), Supplemental Security Income (SSI) or survivor benefits or Railroad Retirement benefits do not need to take any further action, the IRS will direct deposit or mail your Economic Impact Payment to where you normally receive your benefit.

SSI Recipients with qualifying children: If they have children who qualify, an extra step is needed to add $500 per child onto their automatic payment of $1,200 if they didn’t file a tax return in 2018 or 2019. For those who receive Social Security retirement or disability benefits (SSDI), Railroad Retirement benefits or SSI and have a qualifying child, they can quickly register by visiting IRS.gov and providing their information in the Non-Filers section. By quickly taking steps to enter information on the IRS website about them and their qualifying children, they can receive the $500 per dependent child payment in addition to their $1,200 individual payment. If beneficiaries in these groups do not provide their information to the IRS soon, they will have to wait until later to receive their $500 per qualifying child.

Visit special tool available only on IRS.gov and provide their information in the Non-Filers section, online here: https://www.irs.gov/coronavirus/non-filers-enter-payment-info-here

The Cares act for Self employed individuals

Individuals who are self-employed and were affected by COVID-19 may now qualify for unemployment insurance benefits due to the Federal CARES Act. The weekly benefits that they are eligible for will be calculated in the same way as other workers who are eligible and include an additional $600 until July 31, 2020. Benefits will be available for up to 39 weeks. The period of unemployment due to COVID-19 that is eligible for coverage is from Jan 27, 2020 until December 31, 2020, which is when the eligibility expansion for self-employed individuals will end.

Individuals can file a claim online at https://www.edd.ca.gov/ or via phone with a representative. Phone representatives will be available M-F: 8am-12pm PST. They are not available on holidays.  Please Note: Phone lines may be busy due to increased call volume.

English: call 1-800-300-5616

Cantonese: call 1-800-547-3506

Spanish: call 1-800-326-8937

Mandarin: call 1-866-303-0706  TTY call 1-800-815-9387

Vietnamese: call 1-800-547-2058

The CARES Act for Small Businesses

The U.S. Small Business Administration may offer assistance with applying for relief, guidance through available resources, cash flow concerns, supply chain interruptions, workforce capacity, insurance coverage and more. COVID-19 resources and further information about the programs that are available can be found at the link here: https://www.californiasbdc.org/covid19 

Need assistance with:

A quick infusion of a smaller amount of cash to cover you right now?

You might want to look into an Emergency Economic Injury Grant.

To ease your fears about keeping up with payments on your current or potential SBA loan?

The Small Business Debt Relief Program could help.

Capital to cover the cost of retaining employees?

The Paycheck Protection Program might be right for you.

Free counseling to help you navigate this uncertain economic time?

Local resource partners might be your best bet.

  • Butte College SBDC, Small Business Development Center. 2480 Notre Dame Boulevard, Chico, CA 95928 Phone: 530-895-9017
  • Greater Chico Area SCORE, SCORE Business Mentor, 1324 Mangrove Ave., Suite 114, Chico, CA 95926 Phone: (530) 342-8932 online: https://greaterchicoarea.score.org/ email: scorechico@sbcglobal.net
 

Cares ACt for Non Profits and other Tax exempt Organizations

Loan Repayment and Forgiveness

The CARES Act provides that repayments of the loan will be eligible to be deferred for least six months but not more than one year and the interest rate is capped at 4%. Prepayment penalties are waived. In addition, forgiveness of the total amount spent on payroll costs and mortgage interest, rent and utility payments between February 15, 2020 and June 30, 2020. The amount of loan forgiveness will be reduced by the reduction of number of employees employed compared to the prior year and by the reduction in pay of any employee’s compensation beyond 25% compared to the prior year. In addition, the loan forgiveness amount cannot exceed the original loan principal.
Nonprofits must separately apply for loan forgiveness and will be notified of the decision within 60 days. The lenders may require adequate documentation to process the loan forgiveness such as verifying the full-time equivalent and pay rates for current and prior years. This may include quarterly payroll tax filings, W-3 information etc. The primary purpose of the Paycheck Protection Program is to keep American workers paid and employed during this difficult time.

Charitable Giving Incentives

The CARES Act lifts the limitations on charitable contributions by individuals who itemize, from 60% of adjusted gross income to 100% and for corporations by increasing the limitation from 10% to 25% of taxable income. Donations to donor-advised-funds would not qualify for the increased deduction.

Emergency Economic Injury Disaster Grants (EIDL Grants)

The CARES Act includes $10 billion for the federal Small Business Administration (SBA) to provide emergency grants until Dec. 31, 2020. Nonprofits seeking an immediate relief can receive a $10,000 emergency advance within three days after applying for the EIDL grant. If the application is denied, the applicant is not required to repay the $10,000 advance. All “private nonprofit organizations” are eligible for the EIDL grants including 501 (c) trade associations, advocacy organizations, unions and social clubs. These organizations are excluded to participate in the Paycheck Protection Program.

Employee Retention Tax Credit

Please note nonprofits participating in the Paycheck Protection Loan Program are not eligible for this credit. CARES Act provides for a refundable payroll tax credit up to a $5,000 per employee for nonprofits where operations were fully or partially suspended due to a COVID-19 shutdown order or whose gross receipts declined by more than 50% when compared to the same quarter in the prior year. Nonprofits managers must consider the entity’s whole operations when determining the decline in revenue. This credit is available for wages paid or incurred from March 13, 2020 through December 31, 2020.

Unemployment Benefits

The CARES Act includes a specific section allowing nonprofits to be reimbursed for half of the costs incurred through the end of 2020 to pay unemployment benefits, including self-funded unemployment benefits.

Loans Under Paycheck Protection Program

This program is designed to make funds available to qualifying businesses through U.S. Department of the Treasury approved banks, credit unions and other lenders. This is available for 501(c)(3) nonprofit organizations with 500 or fewer employees. Nonprofits can borrow 2.5 times of monthly payroll expenses, up to $10 million. The funds can be used to cover 1) qualified payroll costs; 2) rent and utilities; and, 3) interest on mortgage and debt obligations.
Qualifying payroll costs include salaries, vacation, parental, family, medical or sick pay, severance payments, healthcare benefits, retirement benefits and state and local employment taxes. Funds cannot be used for compensation in excess of an annual salary of $100,000 for individual employees or wages already covered by the Families First Coronavirus Response Act. Nonprofit managers must certify that the loan is necessary due to the current economic conditions and that the nonprofit is not receiving duplicate funds for the same expenses.

Please Note: The SBA is currently unable to accept new applications for the Paycheck Protection Program based on available appropriations funding. Funding availability may change in the future, check in with the SBA here: https://bit.ly/3aCPU17

Economic Stabilization Fund

The CARES Act provides $500 billion for economic stabilization in the forms of loans, loan guarantees and investments in industries affected by COVID-19. Nonprofits that are not eligible to participate in the Paycheck Protection Program might be eligible to participate in the Economic Stabilization Fund including those nonprofits with more than 500 employees. The funds must be used to retain employees and restoring the compensation and benefit levels. Nonprofit managers must decide between the EIDL and Paycheck Protection Program, since you are not allowed to get both. Managers do have the option to apply for both loans and decide to take one if the organization qualifies for both. The maximum loan size under EIDL is $2 million versus up to $10 million under the Paycheck Protection Program. The interest rate is lower for EIDL loans (2.75% for nonprofits) and can be financed for up to 30 years, considerably longer than the 10 years for the Paycheck Protection Program. One of the major advantages of Paycheck Protection Program is the loan forgiveness program if the organization qualifies for it.