We know this is a challenging time and, while we’re all facing this together, we know that each individual is being impacted in dramatically different ways. At Divvy, we remain as committed as ever to helping Americans rent and build wealth in their forever homes and as such we want to help you navigate this incredibly hard time by keeping you informed of the various existing and new programs that may be able to help you weather this storm. Below we’ve put together a guide to help you navigate the various resources. We expect this will continue to evolve, and we will continue to inform you as changes take place.
Direct Financial Assistance (more information HERE)
One of the key pieces of the CARES Act that was signed into law on March 27 is that it will provide direct financial assistance to most Americans in the form of checks with the amount received based on income. We have detailed the takeaways below, but you can use this calculator HERE to understand how much you will likely receive.
- Summary of Benefits: The amount you receive will depend on your personal situation. You can use this calculator HERE to understand how much you will likely receive.
Individuals who earn $75,000 or less in adjusted gross income will get direct payments of $1,200 each. The payment will scale down as income rises, phasing out entirely at $99,000 for singles without children.
Married couples who earn $150,000 or less in adjusted gross income will get direct payments of $2,400. The payment will scale down as income rises, phasing out entirely at $198,000 for couples without children.
An additional $500 per child age 16 or under will be tacked onto the payment detailed above.
- Timing: To execute on the sending out of the checks, the Internal Revenue Service (IRS) will need to process and calculate each and every payment. While the White House has indicated that Americans could be seeing direct payments as soon as April 6, we believe it could take longer.
- How will the IRS calculate my income? If you have already filed your 2019 Federal Income Taxes, the IRS will use that as the basis of the calculation for your check. However, if you have not yet filed for 2019, the IRS will use your 2018 filing.
- Do I need to do anything to receive my check? You do not need to to sign up or do anything to receive your check unless you have not filed for taxes in either 2018 or 2019, which will be used to calculate your check amount.
- How can I get an update on my check status? You can seek updates HERE.
- How many payments will there be? This is a one-time cash transfer, however, there is a chance that future bills could change that. We will aim to keep you informed as this develops.
Emergency Family Paid Sick Leave Act (more information HERE)
If you work for an employer with fewer than 500 employees, you may be eligible for paid sick leave under the Emergency Paid Sick Leave Act. This means if you or a loved one has COVID-19, if you need to remain home to care for a child whose school closed, or if you have been ordered to quarantine, then you are eligible for 80 hours of paid sick leave.
- Summary of Benefits: Full-time employees receive 80 hours of paid sick leave. Part-time employees receive the equivalent of the number of hours they would work, on average, during a two-week period.
- How to Get These Benefits: Contact your employer and ask to be paid for your benefits under the Emergency Family Paid Sick Leave Act.
Emergency Family and Medical Leave Expansion Act (more information HERE)
If you foresee being out of work for an extended period of time because you need to care for a child whose school or place of care has closed due to COVID-19, you could be eligible for up to 12 weeks of leave if you are unable to work.
- Summary of Benefits: A qualifying employee may take up to 12 weeks of leave. The initial 10 days of leave are unpaid, but the employee may elect to use his/her accrued paid sick leave and/or accrued vacation during this otherwise unpaid period. After the initial 10-day period, an employee is entitled to receive from the employer two-thirds of his/her normal wages for the number of hours he/she would be regularly scheduled to work, up to a maximum of $200 per day and $10,000 in total.
- How to Get These Benefits: Contact your employer and ask for your benefits relating to the Emergency Family and Medical Leave Expansion Act.
Unemployment Insurance Expansion (more information HERE)
In addition to the above, there have been several areas of expansion to unemployment insurance with the CARES Act.
- Unemployment insurance will be expanded by 13 weeks so that, in total, unemployed workers are eligible to receive up to 39 weeks of unemployment benefits.
- For 4 months, the federal government will provide an additional $600 per week on top of what state unemployment programs pay.
- Unemployment insurance has been expanded to include freelancers, furloughed employees and gig workers, such as Uber drivers, through the end of the year.
- If you cannot work as a result of a family member who is experiencing Covid-19 symptoms, or because you must care for a child, elderly parent or another household member, you are eligible for this program.
Unemployment benefits vary by state, but please see the below links for more information on a state by state basis:
Healthcare Coverage (more information HERE)
If you have lost your job due to COVID-19, and want to ensure you and your family have healthcare coverage, you can apply for COBRA. COBRA benefits should be sent to you directly from your healthcare provider, but more information about COBRA can be found HERE.
Delayed Tax Payments (more information HERE)
The IRS moved the national income tax filing day ahead to July 15 from April 15. All taxpayers and businesses will have this additional time to file and make payments without interest or penalties. However, remember that most Americans are entitled to refunds when they file their federal tax returns. Lastly, keep in mind that your State’s deadline may still be April 15, so make sure to double check.
Student Loan Assistance (more information HERE)
Until Sept. 30, there will be automatic payment suspensions for any student loan held by the federal government. It may be hard to contact your loan servicer right now, so we recommend you check your account online in the coming weeks, which should show that you have no payment due. Within a few weeks, you are supposed to receive notice indicating what has happened with your federal loans. You can choose to keep paying down your principal if you want.
If your student loan is with a state agency or private lender, we recommend that you check to see if they are offering their own emergency assistance programs.
Additionally, some employers can provide up to $5,250 in tax-free student loan repayment benefits. That means an employer could contribute to loan payments and you wouldn’t have to include that money as income. Ask your employer if you might be able to qualify for this benefit.
Small Business Loans (more information HERE, HERE and HERE)
The CARES Act also created the Paycheck Protection Program that allows approved financial institutions to provide federally-backed, forgivable loans to eligible businesses.
- Eligibility: Any business with fewer than 500 employees is eligible for the loan. Self-employed individuals, independent contractors, and sole proprietors are also eligible.
- Loan Amount: Maximum loan size is up to 2.5 times average monthly payroll costs over the prior 12 months for most businesses, or over a more targeted period for seasonal businesses, but may not exceed $10 million.
- Usage: Allowable uses of the loan include eligible payroll support, interest paid on a mortgage or rent, and utility payments.
- Loan Terms: The loans will carry a fixed interest rate of up to 4% and can be paid over a 10-year period. There will be no prepayment penalty, and you will not have to pay on your loan for the first 6-12 months.
- Loan Forgiveness: Up to 100% of the principal amount of the loan may be forgiven if you used the funds on qualifying expenses. The amount of forgiveness is calculated as the sum of amounts paid in the eight weeks following loan origination for: a) Payroll, b) mortgage interest, c) rent and d) utilities. If the business uses the loan funds for the approved purposes and maintains the average size of its full-time workforce based on when it received the loan, the principal of the loan will be forgiven, meaning the company will only need to pay back the interest accrued.