Congress Approves COVID-19 Economic Relief Plan
On Friday, the Coronavirus Aid, Relief and Economic Security (CARES) Act passed the House by a voice vote, which the President then inked into law. The package includes a $600 per week increase in unemployment insurance for workers, including benefits for up to four months. Additionally, $350B is allocated for the Paycheck Protection Program, meant to help small businesses impacted by the pandemic to make payroll and to cover expenses from 2/15 – 6/30. The rebate inside the bill phases out at $75,000 for singles, $112,500 for heads of household, and $150,000 for joint taxpayers at 5% per dollar of qualified income, or $50 per $1,000 earned. To read more about the relief plan, click here.
Investors Take Note: Negative Rates Have Arrived
Yields on one-month and three-month U.S. Treasury bills dropped below zero last week — signaling that investors are still seeking safe assets like fixed-income government debt. This came right before the $2 trillion relief bill was signed into law by President Trump. The Dow soared more than 2,100 points last week, or over 11%, for its biggest one-day gain since 1933. Negative bond rates signal high investor demand. Consequently, investors are now willing to pay a premium on these bonds in exchange for safety and the confidence the investment will payout. On the international economic scene — Germany, Denmark, France, Sweden, and Japan also have government debt that pays negative rates. For more perspective on bond investments, go here.
IRS Extends Deadline for IRAs and HSAs Due to COVID-19
The Internal Revenue Service has pushed the deadline for making Individual Retirement Account and Health Savings Account contributions to July 15, 2020, as a result of the novel coronavirus outbreak. Since the tax code says the contribution deadline is the tax filing date, it follows the contribution items that have been extended. Contributions can be made to your IRA for a particular year, at any time during the year or by the due date for filing your return for that year. Contributions may be made to your HSA or Archer MSA, for a particular year, at any time during the year — or by the due date for filing your return. To make sure your contributions are recorded, read the advice on this page.