COVID-19 Update: Important Information You Need To Know And CARES Act Information

Craig Watkins |

A few important updates:

Deadline for Tax filing, pushed to July 15th
IRS Notice 2020-18 Relief for Taxpayers has extended the 2019 tax filing and IRA contribution deadline from April 15th, to July 15th

 

Important Changes due to the CARES Act:

 

Important information regarding distributions:

  • All required minimum distributions for 2020, for all retirees, have been eliminated due to the passing of the CARES Act.  If you turned 70 ½ in 2019 and had until April 1st to take your RMD, you do not need to take your RMD for 2019.  This includes required minimum distributions for inherited IRA’s for any beneficiaries using the “stretch” IRA option before 2020.
  • If you have already taken your RMD for 2020, you could be eligible to roll it back into your IRA within 60 days of taking it, but you can only do this once in a 12-month time frame.  If you are a beneficiary who is not a spouse and have taken an RMD, this does not apply.
  • Any qualifying distributions taken for Corona virus reasons will still be taxed as income, but the 10% IRS penalty for taking a premature distribution before the age of 59 ½ will be waived for amounts taken that do not exceed $100,000.00.  Amendments will need to made, contact us for more details 

 

Medicare important information:

  • If you are on Medicare, you will be eligible to receive the COVID-19 vaccine (when available) at no cost to you
  • During the COVID-19 emergency period, Medicare Part D recipients must be given the ability to obtain up to a 90-day supply of medication prescribed to them
  • Telehealth services may be temporarily covered during this COVID emergency period

 

Changes to Charitable Giving:

  • For 2020 you can donate up to $300 in cash to a charity, regardless if you itemize deductions
  • If you itemize deductions, the 60% adjusted gross income limit will be suspended for 2020
  • If you own a corporation, the charitable contribution limit is 25% of your taxable income for 2020

 

Changes for Mortgages/Renters:

  • No foreclosure proceedings can start for at least 60 days as of March 18, 2020
  • If you face financial hardship due to COVID-19 and your mortgage is serviced by a federally backed company, you can request to postpone payments for up to 180 days, with extension possible for an additional 180 days after the first request
  • From the date of the CARES Act, anyone with mortgages backed by federal entities, may not impose eviction notices among tenants for 120 days and no fees or penalties may be passed on to tenants

 

Changes to Student Loans/related information:

  • Students can see certain work/study programs refunded from Universities from CARES Act relief funds
  • Any federally held student loan payment is automatically suspended through September 30, 2020 and no interest for any other penalty fee will accrue during that time period

 

Our motto has always been, “Plan First, Invest Second”.  Seeing us through this challenging time is the custom designed income distribution plan.  Your income distribution plan is of great value in times of market turmoil like we are experiencing.  In times like this you see the mix of principal protected assets in your plan allow you to weather through and not rely on market volatility.  It is with this planning philosophy here at CFG, which you can see has taken the sting out of this market volatility.  It is imperative we continuously monitor and adjust your long-term plan, so your retirement goals can be pursued.  Please do not hesitate to contact our office to schedule a phone or Webex meeting to discuss how we can help you or your loved ones ensure long-term goals are still being pursued.

 

 

 

Craig Watkins is an investment adviser representative of, and advisory services are offered through, USA Financial Securities Corp., A Registered Investment Adviser located at 6020 E. Fulton St., Ada, MI 49301. Craig Watkins is also a registered representative of USA Financial Securities Member FINRA/SIPC. Cornerstone Financial Group is not affiliated with USA Financial Securities. Craig CA license #0591010