Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”)

Following the US Senate’s unanimous vote late Wednesday March 25, 2020, the US House of Representatives passed the “Coronavirus Aid, Relief, and Economic Security Act” (the CARES Act) by a voice vote early Friday afternoon. The bill now heads to the White House, where President Trump will sign the legislation very soon.

The CARES Act Top 10 Takeaways:

  1. Provides stimulus to individuals, businesses, and hospitals in response to the economic distress caused by the coronavirus (COVID-19) pandemic.
  2. Creates a $349 billion loan program for small businesses, including 501(c)(3) non-profits and physician practices. These loans can be forgiven through a process that incentivizes companies to retain employees.
  3. Allocates $500 billion for assistance to businesses, states, and municipalities, with no more than $25 billion designated for passenger air carriers, $4 billion for air cargo carriers, and $17 billion for businesses critical to maintaining national security. The remaining $454 billion may be used to support lending to eligible businesses, states, and municipalities.
  4. Allocates $130 billion in relief to the medical and hospital industries, including for medical supplies and drug and device shortages.
  5. Expands telehealth services in Medicare, including services unrelated to COVID-19 treatments.
  6. Provides $1,200 to Americans making $75,000 or less ($150,000 in the case of joint returns and $112,500 for head of household) and $500 for each child, to be paid “as rapidly as possible.”
  7. Expands eligibility for unemployment insurance and provides people with an additional $600 per week on top of the unemployment amount determined by each state.
  8. Expands the Defense Production Act, allowing for a period of two years when the government may correct any shortfall in resources without regard to the current expenditure limit of $50 million.
  9. Provides the Secretary of the Treasury with the authority to make loans or loan guarantees to states, municipalities, and eligible businesses and loosens a variety of regulations prior legislation imposed through the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Economic Stabilization Act of 2008, and others.
  10. Accompanied by supplemental appropriations to help the government respond to this pandemic.

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