CARES Act Vote Expected in Senate Tonight

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Please note the information below is subject to change, since this bill is not yet finalized. 

 

Although no vote has taken place as of early this evening, it was expected that the US Senate would pass a $2 trillion economic stimulus package tonight and send it to the US House of Representatives. The bill will not become law until it also passes the House and is signed by the President.

 

Senate leaders are encountering last minute snags and hurdles as they write the fine print this evening, and the proposals are subject to change in either the Senate or the House. If passed in its most recent version, the Coronavirus Aid, Relief, and Economic Security (CARES) Act is expected to contain these provisions:

 

Unemployment Benefits

 

  • boost the maximum benefit by $600 per week
  • provide laid-off workers their full pay for four months
  • extend eligibility to independent contractors and the self-employed

 

Business

 

  • $500 billion in emergency loans to distressed large businesses, including:
    • $25 billion for passenger airlines
    • $4 billion for carriers
    • $3 billion for aviation contractors
    • $17 billion for "businesses critical to maintaining national security"
  • creation of an oversight board and inspector general to oversee these loans
  • prohibition of federal relief to companies owned by President Trump and his family
  • Increase the taxable business limit for business interest expense from 30% to 50%
  • create an employee retention credit for employers forced to close due to the pandemic
  • establish and provide funding for $367 billion in small business forgivable bridge loans
  • Restore the 15 year life and bonus depreciation of qualified improvement property

 

Taxes

 

  • fund $1,200 tax rebates to individuals, ($2,400 for joint taxpayers) with additional $500 payments per qualifying child. The rebate begins phasing out when incomes exceed $75,000 (or $150,000 on joint returns)
  • allow withdrawal of up to $100,000 from retirement plans without 10% additional tax
  • delay due dates for 2020 employer payroll taxes
  • repeal the 80% income limitation on net operating losses; permit loss carrybacks for years 2018-2020
  • repeal the $250,000 ($500,000 joint) excess loss limitation until 2021
  • create a $300 above-the-line charitable deduction
  • increase the AGI limit for charity from 60% to 100%

 

Health Care

 

  • provide $130 billion for hospitals
  • provide additional funding for the prevention, diagnosis, and treatment of COVID-19
  • limit liability for volunteer health care professionals
  • prioritize Food and Drug Administration review of certain drugs
  • allow emergency use of certain diagnostic tests that are not approved by the FDA
  • expand health-insurance coverage for diagnostic testing and require coverage for preventative services and vaccines
  • revise provisions regarding the medical supply chain, the national stockpile, the health care workforce, the Healthy Start program, telehealth services, nutrition services, Medicare, and Medicaid

 

Education

 

  • temporarily suspend payments for federal student loans 
  • revise provision related to campus-based aid, supplemental educational-opportunity grants, federal work-study, subsidized loans, Pell grants, and foreign institutions

 

During this crisis, your LMC professional is available if you have questions related to the latest updates on this topic.   All our prior Alerts are available on the Updates page of our website.

 

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