New Federal and State Benefits
A guide to the federal stimulus and state mortgage and eviction protections
The $2.2 trillion CARES Act includes extraordinary public health spending to confront the COVID-19 pandemic as well as immediate cash relief for individual citizens and additional assistance for workers who have lost their jobs. Here are several key components:
Emergency Unemployment Compensation
A suite of new federal unemployment compensation programs provides a variety of enhanced benefits to support workers and families suffering COVID-19 related job loss or loss of hours. These enhanced benefits include: payments of an additional $600 per week for the next four months on top of one’s normally calculated unemployment benefits; the extension of unemployment benefits for an additional 13 weeks; and the expansion of benefit eligibility to include self-employed workers and workers with work histories normally too short to qualify for benefits. To read more about it, click here.
The CARES Act provides U.S. taxpayers recovery rebates of up to $1,200 ($2,400 for joint filers) for US taxpayers. Amounts are increased by $500 for each dependent child, and reduced on a sliding scale for individuals making more than $75,000 per year, heads of household making more than $112,500 per year, and joint filers making more than $150,000.
No action is required to receive the rebate. To see how much you should receive, click on this calculator.
Penalty-free early distributions from retirement accounts
The CARES Act waives the 10% additional tax for premature distributions from IRAs and retirement accounts, and raises the allowable amount of such distributions to $100,000 for people who are infected with COVID-19 or lose income due to the pandemic.
Amounts distributed may be repaid at any time over the three-year period commencing on the date the distribution was received. For more information, click here.
More money for health care
The stimulus includes $100 billion in investments in health care preparedness and another $150 billion in aid to state and local governments. While that spending is welcome, state and local governments will need more federal support in the future to cover looming budget shortfalls caused by the pandemic.
Workers’ advocates have raised concerns with the stimulus package’s provision of aid to other industries, including its lack of sufficient oversight to ensure that huge sums of financial assistance go toward saving jobs and preserving workers’ pay and benefits. To read more about the stimulus, click here.
Actions by Governor Newsom
Independent of the stimulus package, California Governor Gavin Newsom and most major lenders have reached an agreement instituting a 90-day grace period for mortgage payments. Gov. Newsom also announced a moratorium on evictions through May 31, 2020 for renters impacted by the pandemic, although tenant advocates were quick to note that the order only delays a tenant’s legal window for responding to an eviction filing in court, and doesn’t stop new evictions from being filed. Evictions unrelated to COVID-19 or for a breach of the lease unrelated to rent payment would still be allowed.