CARES Act Updates | December 2020
The Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law by President Donald Trump in March 2020 and it is a $2.2 trillion economic stimulus bill. The COVID-19 pandemic has caused massive damage to businesses all across the United States, with countless people still out of work or restricted as a result of these issues.
The initial CARES Act payments saw $300 billion worth of one-time cash payments going towards individual Americans. This saw most single adults getting $1,200 and those with children getting a higher amount. Significant funds also went towards CARES Act unemployment benefits, the Paycheck Protection Program, aid to major corporations and money for both local and state governments.
The overall goal of the CARES Act was to minimize the economic impact of the large-scale shutdowns caused by the pandemic. It is helping businesses to survive, to keep playing workers, provide CARES Act unemployment benefits for those out of work and to ensure that people have enough money to keep food on the table. This article looks at some of the latest updates to the CARES Act since it was signed into law in March.Best Business loans
Helping the country
There were four main groups that received aid through the CARES Act. Households were able to avail of CARES Act unemployment assistance and recovery rebates. This included decreasing the individual’s tax liability. There were also individual unemployment benefits given to people, with those who have dependents getting more.
CARES Act small businesses received $377 billion in aid through the form of grants and loans. This will help them ride out the closures or limited opening hours due to the pandemic. The Payment Protection Program provided the loans, while the Emergency Economic Injury Disaster Loan Program gave emergency grants.
The third group to get help were business and the markets. Of the $500 billion or so given out, about $46 billion went towards industries that were especially hit hard by the pandemic. The majority of the funds went towards making sure there was market liquidity to avoid an economic credit crisis.
Finally, the aid to state and local governments was about $330 billion. This went towards public health initiatives and hospitals, airports, transit agencies, educational programs, and just all-around funding.
In all, there will be an estimated loss of output of almost $1 trillion in 2022 in the United States, with the CARES Act not making up for it. However, the goal is to close the gap, and hopefully by the middle of 2021, things will ramp up again and the economy will start to recover. The positive news about vaccines has already raised hopes of a successful exit for people, businesses, and governments.
Time running out
If there is no further stimulus bill, the current provisions of the CARES Act will expire on December 31, 2020. Some of the provisions already expired, such as the Federal Pandemic Unemployment compensation plan that was providing extra unemployment insurance of $600 each week.
However, the bulk of the previous are going to expire if nothing is done by the end of the month. This comes at a time when COVID-19 cases are rising significantly across the United States and there are extensive calls for another round of relief.
There are numerous provisions for individuals that will be expiring at the end of 2020. A lot of the unemployment insurance provisions will longer be active, such as the Pandemic Unemployment Assistance, unemployment benefits for those who work in the gig economy, and the extension of benefits for another 13 weeks.
There will also be the reintroduction of a one week waiting period when you are looking