The CARES Act
The CARES Act was passed and signed on March 27,2020. This law marks the single largest economic stimulus package in history and is intended to provide relief to the many businesses and individuals impacted by COVID-19.
Below is a summary of the tax law provisions that impact individual taxpayers.
Provides for recovery rebates to eligible individuals. This is constantly being updated by the IRS. More information can be found on IRS website .
Eligible Taxpayers can take distributions of up to $100,000 from retirement plans without being subject to a 10% penalty. These can be taken until Dec 31, 2020. Coronavirus-related distributions may be repaid within three years.
Modification in charitable deductions – For tax years beginning in 2020, taxpayers that take the standard deduction, are allowed a deduction from taxable income (in addition to the standard deduction) of up to $300 for qualifying charitable contributions made in cash.
Modification in Net operating losses for tax years 2018, 2019 & 2020 – The losses can now be carried back 5 years
Modification in Health plans – The HDHP (High Deductible Health Plans) are now amended to cover tele-health and other remote care without charging deductibles.