Benefits of the CARES Act for individuals

Published on

A very quick summary of the biggest economic bill in history for businesses

The Coronavirus Aid, Relief, and Economic Security act – the CARES Act – is the largest economic bill in U.S. history and was designed to “provide emergency assistance and health care response for individuals, families, and businesses affected by the 2020 coronavirus pandemic.” Spanning close to 900 pages, the CARES Act builds upon earlier versions of federal government support and is the third such bill, coming shortly after the “Coronavirus Preparedness and Response Supplemental Appropriations Act” and the “Families First Coronavirus Response Act” were approved.

Here are a few highlights that might be of interest to business owners, but it’s important to remember that not all provisions of the CARES Act are available to every business, so conversations with your advisor is highly recommended.

Protecting paychecks

The Paycheck Protection Program offers loans to small businesses that are fully guaranteed by the federal government. The loans are designed to cover eight weeks of operating costs during the crisis – so that means covering payroll and the costs of rent, utilities, mortgage interest, etc. These loans may be fully forgiven so long as the business complies with the federal government rules.

Employee retention tax credit

A refundable payroll tax credit up to $5,000/employee. But in order to qualify, a business must have closed completely/partially, or revenues had to have declined by more than 50% relative to the same time last year.

Sick and family leave tax credits

Credits for sick and family leave costs for businesses with fewer than 500 employees. Businesses are eligible to receive refundable tax credits as are businesses with no employees (sole proprietors).

Deferral of social security taxes

Businesses can defer payment of the employer share of Social Security tax incurred from March 27th through December 31st, but the deferred taxes must be paid over two years.

It’s complicated

As a business owner, you’ll have choices to make when deciding which benefit to use. For example, a business cannot apply both the Paycheck Protection program and the employee retention tax credit. There are a lot of nuances within the CARES Act to think through. Talk to your financial professional.

Important Disclosure

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, consult your financial professional prior to investing. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and cannot be invested into directly.

The information provided is not intended to be a substitute for specific individualized tax planning or legal advice. We suggest that you consult with a qualified tax or legal advisor.

This article was prepared by RSW Publishing.

LPL Tracking 01-982285

You may also like


Savings vs CD accounts: Which should I choose?

Unsure if you should put your money into a Savings account or if a CD is a better option? A savings account offers you more flexibility and access to your funds, but a CD will probably provide you with a…


With these assets and liabilities, I thee wed

7 Key Questions to Ask Before Getting Married

Joining your lives together means joining your financial lives, too. You see one future with many goals. But each of you comes to a marriage with different spending habits, different attitudes…


How we prevent fraudulent transactions

You've just received an automated phone call from someone claiming to be "fraud prevention" calling on behalf of Webster Bank. They want to verify recent debit card transactions with you, but you know that you haven't used…

General Disclosures

The opinions and views in this blog post are those of the authors, and are not intended to provide specific advice or recommendations for any individual. Please consult professional advisors with regard to your individual situation.


Securities and insurance offered through LPL or its affiliates are:

Not Insured by FDIC or Any Other Government Agency

Not Bank Guaranteed

Not Bank Deposits or Obligations

May Lose Value

Securities and advisory services are offered through LPL Financial (LPL), a registered investment advisor and broker-dealer (member FINRA/SIPC). Insurance products are offered through LPL or its licensed affiliates. Webster Bank and Webster Investments are not registered as a broker-dealer or investment advisor. Registered representatives of LPL offer products and services using Webster Investments, and may also be employees of Webster Bank. These products and services are being offered through LPL or its affiliates, which are separate entities from, and not affiliates of, Webster Bank or Webster Investments.

The LPL Financial registered representatives associated with this website may discuss and/or transact business only with residents of the states in which they are properly registered or licensed. No offers may be made or accepted from any resident of any other state.

The Webster Symbol is a registered trademark in the U.S.