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Federal Cares Act offers assistance during COVID-19

Deciphering the Federal Cares Act.jpeg
Posted at 5:03 PM, Apr 01, 2020
and last updated 2020-04-19 18:09:05-04

WASHINGTON, D.C. — Plenty of people are applying for state unemployment, there is help coming from the federal government as well through the federal CARES Act.

The act offers assistance for individuals and small businesses affected by covid-19.

It gives helps companies continue to pay their employees. It also expands unemployment through the federal government to $600 a week in addition to the state maximum weekly benefit of $382.

Michigan tax attorney, Megan Parpart, said, “So if you qualify for the maximum amount of unemployment it’s $982 a week that you could receive.”

For some, that likely more than their normal check. But that extra boost from the government only last 13 weeks.

“I understand it could be desirable because the employee could be thinking ‘oh that’s more money that I make at my job.’ But it’s only for 13 weeks." Papart explained. "It’s meant to be a boost to get you by not a permanent replacement for your employment.”

Not to mention you have to be laid off to receive it. You cannot just decide you don't want to show up.

“So you cannot elect to go on unemployment. If your employer has work for you to do, or wants to keep you on their payroll and you say.. I don’t want to come to work.. then you’re not eligible for unemployment.” Papart told FOX 17.

Governor Whitmer also expanded benefits in the stat to include people not normally covers like sole-proprietors, the self-employed, and independent contractors.

“And those are some of the people who have been most heavily impacted because if you’re an independent contractor that means you’re not on someone’s normal payroll so you don’t have the traditional healthcare, vacation or sick leave benefits that an employee would.” Says Papart.

There's also the Payroll Protection Program, which is aimed at helping small businesses with fewer than 500 employees, eligible non-profits, veteran's organizations, and tribal businesses. Those eligible can qualify for loans up to $10 million.

“So the amount you can borrow is 2 1/2 times your average monthly payroll. For most employers that’s going to be the average monthly payroll for the entire year of 2019.”

If you keep your workforce, or restore it to what it originally was before February 15th, your loan can be forgiven, depending on what you spend on payroll, rent, utilities, and mortgage interest within an 8 week period. If you're not paying people, you'll have to pay it back.

The paycheck protection program runs through June 30th. Lenders will start processing applications Friday.