Life is not how many of us pictured 2020 being. We were coming out of winter hibernation, only to be placed under a “Stay-At-Home” order by the Minnesota Governor. This has affected many of us in our communities and has forced many to be laid off because of the Coronavirus Pandemic. If you have been affected by COVID-19, there are some changes from Coronavirus Aid, Relief, and Economic Security Act (CARES Act) that may help you through this time. On March 27th, 2020 President Trump signed the act into law. Below are some highlights of the major changes the CARES Act addresses for temporary help:
Tax Relief for Individuals:
- Extension of Federal Tax Filing: The IRS postponed to July 15, 2020 the due date for both filing an income tax return and for making income tax payments originally due April 15, 2020.
- IRA Contribution Deadline extended: The deadline for making 2019 IRA contributions has also been extended until July 15, 2020.
- Recovery Rebates: Cash payments called “recovery rebates” are available to U.S. residents with income below certain levels who cannot be claimed as a dependent of another taxpayer and who have a Social Security Number.
- Required Minimum Distributions (RMDs): All 2020 RMDs from IRAs and retirement plans are waived, including RMDs from inherited IRAs (both traditional and Roth).
- Tax-favored Early Distributions from Retirement Plans: The CARES Act waives the 10% penalty applicable to early distributions for coronavirus related distributions up to $100,000 from IRAs and qualified defined contribution retirement plans such as 401(k), 403(b), and governmental 457(b) plans.
- Retirement Plan Loans: Beginning March 27, 2020 through 180 days thereafter, the maximum loan amount increases to the lesser of 100% of the vested account balance or $100,000 (reduced by other outstanding loans).
- Charitable Contributions: Individuals who claim the standard deduction may also claim a new above-the-line deduction up to $300 for cash contributions made in 2020 to certain charities.
- Student Loans: Payments (principal and interest) on federal student loans are suspended through September 30, 2020 without penalty.
- Unemployment Benefits: Unemployment benefits have been expanded to assist those who have lost their job during the current economic crisis.
Please remember all of us at NorthRidge are here to help you through these difficult times. We are offering different options that might give some light at the end of the tunnel for you regarding current loans, or potential lending opportunities. Our staff are also Certified Credit Union Financial Counselors and would be glad to help you manage your finances at this time. You are not alone, NorthRidge is still open, still serving, and still here for you.
Please call us at (877)672-2848 or email membersolutions@nrccu.org.
