April 4, 2020
Clarity on the economic stimulus package
1. Tax filing deadline is now extended to July 15 (to file 2019 taxes)
2. Deadline extended for Roth contribution or Traditional IRA contribution (you have until you file your 2019 tax return, or until July 15 whichever one is earlier)
3. Stimulus checks
- $1200 for single filers
- $2400 for married filing jointly
- $500 per child 17 years old and under. (18-year old’s do not qualify)
This tax credit is for 2020. This will impact your 2020 tax return. If you qualify now based on your 2018, or 2019 adjusted gross income on your tax return and no longer qualify in 2020 you will have to pay back $5.00 per $100.00 you were overpaid. You will receive your credit in 2020 if you didn’t meet the guidelines in 2018 and 2019, but your income decreased and you meet these guidelines in the 2020 tax year.
4. Student Loans deferred to Sept. 30,2020
Not all student loans are being deferred. Only direct loans and FFEL loans. Other loans are not included. These are loans that are currently serviced by the government. These are being automatically deferred.
5. Mortgage forbearance
Only those mortgages backed or serviced by the federal government are included. For these loans you have to apply through your lender and they will potentially grant up to a 180-day extension. You will still pay the principal and interest, but this will just be added on to the end of the loan. It is still undecided if you will have to pay tax and insurance payments during the deferral period.
6. Retirees in distribution
If you are at least 70 1/2 prior to 2020 or 72 and older as of 2020, you do not have to take RMDs for the entire year of 2020. You can leave it and let it grow back without any penalties.
7. Taking money from company sponsored retirement plans
You can take money from your 401k or 403b, and traditional IRA – up to $100,000 from your account. But, do this with caution and only if you really need it. Taxes are not waived, only the penalty is waived. You will be taxed at your regular income rate. Use extreme caution.