Part of a series. Covers the change to the US Federal tax return filing deadline and the direct payment.
The Coronavirus Aid, Relief, and Economic Response (CARES) Act includes aid for regular Americans. This article covers two of those items: additional time to deal with Federal taxes and direct payments to individuals.
Please note: before taking action based on this information, please do your own research, including speaking with your CPA, financial advisor or planner, employer, loan servicer, state unemployment office, and heck, maybe even a priest or shaman. My goal is to share my best understanding and to be of service. I hope you find this helpful.
On February 20th, 2020 the first of a series of U.S. stock market drops began in response to the global pandemic and concerns about the effect the disease would have on economic activity worldwide.
On March 21, 2020, an unprecedented spike in first time jobless claims was announced by the Labor Department. There had been 3.2 million first time unemployment claims. The single largest week record before then was for 700,00 back in 1982. Check out this article from Business Insider for details.
On March 27th, the CARES Act was signed. This law provides for loans to corporations, small business loans, household payments, unemployment insurance, tax deferrals and deadline extension, and other funds. Most of the “goodies” we are interested in are in this act.
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This article covers changes for federally-backed student loans made as part of the CARES Act.
This is perhaps the neatest and cleanest aspect of the CARES Act, as it is one of the few areas where the federal government already had complete control and direct communication with citizens. If you have a student loan direct from the U.S. government, your payments will be waived until June 30th, 2020.
Do note that this is only applicable to loans that are direct, FFEL from Department of Education prior to 2010, or Parent Plus loans from the government. Any payments missed during this time will count as payments if you are working toward forgiveness. No interest will accrue.
If your financial situation is good, you can continue to make principal payments, but accrued interest gets paid off first.
No action is required to take advantage of this program.
Please note: this program does not include FFEL loans held by private institutions, Perkins loans, or other private loans.
Journal questions:
How can you best manage your financial goals despite your student debt?
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