Recap on the CARES Act - Prentice Financial Planning, LLC

The biggest stimulus package to ever be signed into law happened Friday, so I wanted to write a quick recap of some of the items that will affect many of my clients. This is not an exhaustive list by any means, but will give your average individual an understanding of how they might be able to benefit.

Cash Payments

A joint tax filer will receive $2,400 and a single filer will receive $1,200, plus $500 for each qualifying child, as long as their income is under $150,000 for joint filers and $75,000 for single filers. There is a phase out, so if you are above these incomes then you may still be able to receive some.

Retirement Plan Distributions

For 2020 taxpayers can take up to $100,000 out of their retirement plans without a 10% penalty as long as it meets certain requirements (mainly for economic hardships caused by the virus).

Charitable Deductions

For 2020 there is a $300 above the line charitable deduction for those people that don’t itemize. I hope that most people will try and take advantage of this, as a lot of non-profits are going to feel the long-term effects of depressed donations.

Required Minimum Distributions (RMDs)

The bill suspends RMDs for 2020, similar to what they did during the 2008 financial crisis.

Here are some things you may want to consider if you are a business owner:

SBA Loan/Grant

SBA is providing loans for companies to basically keep people employed. If those loans are used for payroll, rent, utilities, etc. then it may turn into a grant. To read more about this program go to https://www.sba.gov/page/coronavirus-covid-19-small-business-guidance-loan-resources

Debt Relief

If you already have an SBA 7(a) loan, then they are providing a loan relief program and may pay your interest and principal payments for 6 months. Talk to your loan servicer to see if you qualify.

Again, this is not a comprehensive list and to learn more you can look up the CARES Act or go to sba.gov.

Certified Financial Planner Board of Standards, Inc. (CFP Board) owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER, and CFP® (with plaque design) in the United States, which it authorizes use of by individuals who successfully complete CFP Board’s initial and ongoing certification requirements.

There are no warranties implied.

Prentice Financial Planning, LLC (“RIA Firm”) is a registered investment adviser located in Olympia, WA. Prentice Financial Planning, LLC may only transact business in those states in which it is registered, or qualifies for an exemption or exclusion from registration requirements. Prentice Financial Planning, LLC’s web site is limited to the dissemination of general information pertaining to its advisory services, together with access to additional investment-related information, publications, and links. Accordingly, the publication of Prentice Financial Planning, LLC’s web site on the Internet should not be construed by any consumer and/or prospective client as Prentice Financial Planning, LLC’s solicitation to effect, or attempt to effect transactions in securities, or the rendering of personalized investment advice for compensation, over the Internet. Any subsequent, direct communication by Prentice Financial Planning, LLC with a prospective client shall be conducted by a representative that is either registered or qualifies for an exemption or exclusion from registration in the state where the prospective client resides. For information pertaining to the registration status of Prentice Financial Planning, LLC, please contact the state securities regulators for those states in which Prentice Financial Planning, LLC maintains a registration filing. A copy of Prentice Financial Planning, LLC’s current written disclosure statement discussing RIA Firm Name’s business operations, services, and fees is available at the SEC’s investment adviser public information website – www.adviserinfo.sec.gov or from Prentice Financial Planning, LLC upon written request. Prentice Financial Planning, LLC does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to Prentice Financial Planning, LLC’s web site or incorporated herein, and takes no responsibility therefor. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly.

This website and information are provided for guidance and information purposes only. Investments involve risk and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy. This website and information are not intended to provide investment, tax, or legal advice.