Looking To The Future: Breaking Down The CARES Act

Breaking Down The CARES Act Worth $2 Trillion

This third aid package worth $2 Trillion Coronavirus response bill that the Senate has passed is intended to speed relief to the current state of the American economy. It is purposely meant to maintain businesses and individuals afloat during this unprecedented freeze on the economy.

This necessary emergency relief legislation, also known as Coronavirus Aid, Relief, and Economic Security Act (CARES Act), is described by Senate Majority Leader Mitch McConnell, who vowed to put partisanship aside to get things done and distribute the given emergency relief as soon as possible. According to McConnell, there is no economic policy that can entirely end the hardship as long as the public health needs our commerce to be put on ice.

To get the piece chunk by chunk, seven main groups would have the widest-reaching impacts:

1. Individuals
2. Small businesses
3. Big corporations
4. Hospitals and Public health
5. Federal safety net
6. State and local governments
7. Education

Here is a brief summary of what each group can expect from the emergency relief:

Individuals

Direct cash will be provided to the people to help them keep engaged in the economy. These cash payments are estimated to be around a total of $300 billion. Individuals who are earning less than $75,000 a month can expect to receive one-time cash assistance of $1,200. Families will also receive $500 per child, and the married couple would also have a check each. This also means that a family of four members who earn not more than $150,000 will receive around $3,400.

Individuals will also receive extra unemployment benefits that are around $600 per week from the federal government. Freelancers will also have their share as well as the gig workers. Filling of taxes will be extended as well up to July 15. Employers can also provide their employees with up to $5,250 tax-free student loan repayment plans. Above all else, Coronavirus tests are for free as the bill requires all private insurance plans to cover COVID-19 treatments and vaccines.

Small Businesses

Emergency grants are the main features for small businesses as well as forgivable loan programs for companies that have 500 or fewer employees. There is also a $17 billion relief for existing loans to cover six months of payment for these businesses. About $58 billion is also allocated to help the Aviation Industry stay open and functional. The bill also imposes that there is a fully refundable tax credit for any business size.

Public Health

Hospitals ought to have around $100 billion to respond to Coronavirus cases. Community health centers are also given around $1.23 billion to provide health care services for over 28 million people. The bill also provides around $11 billion for diagnostics, treatments, and vaccines. For medicine and supplies, the bill gives around $16 billion to increase the availability of any medical equipment such as masks and ventilators.

Safety Net

The major food security programs are the second wave of funding. The bill provides around $8.8 billion to schools to be able to serve meals for students and ensure child nutrition. The Supplemental Nutrition Assistance Program is also allotted to have around $15.5 billion as well as the Foodbanks, who will also receive approximately $450 million for food community programs.

State And Local Government

The bill allocates around $339.8 billion for state and local governments. It is roughly divided into a group where specific COVID-19 response occurs, including those states who are running out of cash.

Education

The legislation designates cash assistance and refund for college students and graduates. There is also a Work-study fund program wherein schools continue to pay work-study waging even after suspension.

The federal government is trying its best to sustain the American economy, but only if the given legislation is used accordingly to its purpose. CARES Act is mainly about providing Americans with emergency funds to keep the economy afloat.

Bottom Line

Lives and businesses are being impacted by the Coronavirus, but experts do see a light at the end of the tunnel. As the economy slows down due to the health crisis, we can take guidance and advice from experts that this too will pass. Let’s connect if you have any additional questions. We are here to help!