Rebates/Tax Relief

Subtitles B and C of Title II, Division A of the CARES Act provide rebate checks to individuals/households and tax relief to businesses, respectively.

To Individuals/Households:

Under Subtitle B of this portion of the CARES Act, rebate checks for $1,200 will be sent to all U.S. citizens earning $75,000 a year or less (thus no action/application is required).  Married couples who earn $150,000 or less would receive $2,400, with an additional $500 per child 16 years old or younger.  Individuals earning more than $75,000 and less than $99,000 (or less than $198,000 for joint filers) and heads of households earning more than $112,500, would receive tiered lesser amounts.  Individuals making $99,000 or more (or $198,000 jointly) will not receive checks.  Income amounts are taken from 2019 filed tax returns.  If no 2019 tax return was filed, then 2018 tax returns will be used to determine amounts.  President Trump and Treasury Secretary Munchin have targeted April 6 as a preferred date to send these checks.  However, tax experts (and lawmakers working on this) are skeptical of this potential date and see a date in May as a more realistic window.

To Businesses:

Under Subtitle C, eligible employers – including tax-exempt organizations but not governmental entities – will have the option to receive a refundable payroll tax credit equal to 50% of the first $10,000 in wages per employee (including certain health plan expenses).  Eligible employers are those that (a) have had operations suspended due to orders from an appropriate governmental authority limiting commerce, travel or group meetings (for commercial, social, religious or other purposes) due to COVID-19, or (b) have experienced a reduction in gross receipts of at least 50% when comparing calendar quarters of 2020 to the same calendar quarter of 2019 (until gross receipts exceed 80% when comparing calendar quarters year over year).  Further, if a business receives a Covered Loan (as discussed in the first section of this memo) it is not eligible for this tax credit.  Also, the due date for depositing payroll taxes would be postponed.  50% of the deferred amounts would be due December 31, 2021 while the remaining 50% would be due December 31, 2022.

For more information or questions regarding Rebates, Tax Relief or other assistance for your business, email