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COVID-19 Update | Friday, March 20 (AM)

March 21, 2020

Individual Tax Provisions

  • Individuals would receive checks of up to $1,200 and couples filing jointly would receive up to $2,400. This amount would increase by $500 for each child.
  • The amount would be tied to salary with higher earners receiving less and the payments would phase out beginning at $75,000 in adjusted gross income and $150,000 for joint filers. The amount decreases by $5 for each $100 a taxpayer earns above the $75,000/$150,000 and is eliminated completely for incomes above $99,000 individually and $198,000 for joint filers.
  • The income is based on 2018 tax returns.
  • Individuals with no income tax liability, but at least $2,500 of qualifying income, would be eligible for a minimum rebate check of $600 ($1,200 married).
  • The tax filing deadline would be extended through July 15.
  • The package waives the 10 percent early withdrawal penalty for funds up to $100,000 from qualified retirement accounts for COVID-19-related purposes.
    • Eligible “distributions” are to individuals:
      • Diagnosed with COVID-19
      • Whose spouse or dependent is diagnosed with COVID-19
      • Who experiences adverse financial consequences as a result of being quarantined, furloughed, laid off, having work hours reduced, being unable to work due to lack of child care due to COVID-19, closing or reducing hours of a business owned or operated by the individual due to COVID-19, or other factors as determined by the Treasury Secretary.
  • A delay of estimated tax payments for corporations, which would allow corporations to postpone estimated tax payments due after the date of enactment until October 15, 2020. There is no cap on the amount of payments that can be postponed.
  • A delay of payment of employer payroll taxes, which allows employers and self-employed inviduals to defer payment of the employer share of the Social Security tax they are responsible for paying to the federal government. The language states that the deferred employment tax be paid over the next two years, half of which is due by December 31, 2021.

Industry Specific Provisions

  • Travel and Tourism
    • Passenger airlines can borrow up to $50 billion
      • Recipient airlines would be required to maintain service to existing destinations as of March 1, 2020 with an extra focus on small and remote communities.
    • Cargo can borrow up to $8 billion.
    • The legislation also gives airlines a break from paying fuel taxes.
    • Up to $150 billion in loans for other eligible businesses that have incurred losses, direct or incremental, as a result of coronavirus that put them in jeopardy of closing.
      • Eligible businesses would be required to provide collateral, prove their creditworthiness and certify that this credit is not available from another source.
    • Eligibility would not include businesses already receiving relief through another federal program (such as SBA programs).
    • Recipients would be required to sign a binding contract certifying that a loan would not go to additional executive compensation or to anyone earning more than $425,000 annually for a two year period beginning March 1, 2020.
    • Interest rates on these loans would be based on average Treasury bond yield with similar maturity, but compensate for Federal government risk.
    • The package would amend a provision the 2017 tax law keeps restaurants, hotels and stores from immediately writing off certain renovation costs. While this would return an estimate $15 billion annually to those three industries, it does not provide direct relief.
  • Small Businesses
    • A total pot of $300 billion in loans that are forgivable as long as employers maintain their payroll throughout the emergency. This forgiveness provision is retroactive to March 1 and was added to motivate employers to rehire workers that may have already been laid off.
    • Loans would be capped at $10 million and calculated based on a business’s expenses last year, including payroll, mortgage payments and debt obligations.
    • Eligibility for existing Small Businesses Administration (SBA) loans is expanded to cover paid sick leave, salaries, mortgage payments and supply chain disruptions.
    • The limit on so-called “express loans” offered by SBA would increase from $350,000 to $1 million.
    • Larger businesses, up to 300 times the SBA small business size standard, would be eligible for the loans.
      • Attached is a section-by-section and one-pager of the Rubio-Collins legislation on small businesses, which is included in the package that is still being negotiated.
  • Healthcare
    • Hospitals would receive temporary relief from cuts in Medicare that have decreased Medicare payments by 2 percent and healthcare providers would also receive a 15 percent increase in Medicare payments for COVID-19 patients.
    • $1.3 billion would go to community health centers.
    • Labs and hospitals would be allowed to quickly develop additional tests for COVID-19 under the national health emergency declaration to boost testing capacity.
    • Health insurance companies would be required to cover any vaccine for COVID-19 that ultimately is developed.


  • Yesterday, the State Department issued a level four travel advisory, the highest travel advisory, telling Americans abroad to either come home or prepare to shelter in place. Americans around the world continue to share stories about being stranded abroad with little help from the State Department and embassies.
    • As a response to this, Sen. Bob Menendez (D-NJ) has asked the White House to invoke the Civil Reserve Airfleet Readiness Program to help bring stranded Americans home. The Senator also asked the Department of Transportation and the Pentagon to look into making civilian aircraft and militart plans available for such use.
  • Vice President Pence continues to request construction companies to give protective masks to medical providers.
  • Small Business Administration Disaster Declarations have been declared by 26 states.


  • As reported last night, Senate Majority Leader Mitch McConnell unveiled the Senate Republican COVID-19 relief package (Phase 3) and negotiations with Senate Democrats have already commenced.
  • House Republicans have introduced bills to protect residents of public housing and those experiencing homelessness that may have been affected by COVID-19.
    • H.R. 6294 would require the Department of Housing and Urban Development (HUD) to coordinate with the Department of Health and Human Services (HHS) to identify virus “hot spots” in areas where there are high concentrations of homelessness and section 202 elderly housing. The goal of this bill would be to increase health outreach and testing in these types of areas. House Republicans also introduced H.R. 6295, H.R. 6296, H.R. 6297, and H.R. 6293.
  • Senate Democrats continue to assert that they do not want to give airlines a lifeline unless relief includes protections for labor and consumers, carbon emissions reductions, a ban on stock buyacks, and a stronger provision on executive pay.
  • Tesla will halt operations in its factories in New York and California by Monday.

Other News

  • The American Public Transportation Association (APTA) has increased its bailout request to $16 billion, up from $12.875 billion. In a letter sent to Congressional leaders, APTA noted that the new request includes separate asks by individual agencies (New York’s MTA has requested $4 billion and New Jersey Transit has requested $1.25 billion, for example, as both agencies are experiencing around a 90 percent decrease in ridership.
    • It is important to note that the Senate Republican plan contains zero relief for public transit, while Senate Democrats have offered to help the industry but have not provided any numbers.
  • Federal Aviation Administration (FAA) Administrator Steve Dickson has self-quarantined himself for seven days as a precaution following a recent meeting with Rep. Mario Diaz Balart (R-FL), who recently tested positive for COVID-19. Transportation, Housing and Urban Development, and Related Agencies (THUD) Subcommittee Chairman David Price (D-NC) is taking similar precautions.
  • A DOT employee has tested positive for COVID-19, prompting an order to all staff not to work at its headquarters.
  • The Air Traffic Control Tower at McCarran International Airport was closed after a controller “presumptively” tested positive for COVID-19. A Federal Air Marshal Field Office in Chicago also shut down for cleaning due to an employee testing positive.
  • Discussions continued yesterday of automakers potentially converting their plants to manufacture ventilators and other necessary medical equipment, but experts have indicated this could take a lot of time.
    • Both General Motors and Tesla leadership have offered certain factories to make ventilators and protective medical equipment.
  • Last night, California Governor Gavin Newsom issued a statewide order for all residents to stay at home due to the COVID-19 outreach.
    • The Governor also exempted the 16 critical industries that the Department of Homeland Security’s (DHS) Cybersecurity and Infrastructure Security Agency (CISA) put out a notification on yesterday.
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