Updated March 27th – President Trump has signed the CARES Act after it passed in the House.
On March 25, 2020 – the United States Senate took up two votes on its current version of a Coronavirus Stimulus Package, Phase 3. The first vote was held to pass amendments capping unemployment benefits. The amendment proposed to cap the amount of unemployment insurance benefits an individual could receive, limiting benefits to the amount of wages used to calculate eligible benefits. Concerns had been raised that certain individuals may receive benefits higher than their current wages. The amendment failed to pass.
The second vote to pass The CARES Act was held shortly thereafter and passed with a tally of 96-0. The CARES Act now goes to the House of Representatives, which is not expected to take up the bill until Friday, March 27, 2020.
The CARES Act includes the suspension of various loss and deduction limitation provisions, created by the Tax Cuts and Jobs Act (e.g. changes to allow certain NOLs, increases to business interest expense limits, and excess business loss rules.) It also includes at least one long-awaited technical correction to the TCJA; reinstating a 15 year asset life for qualified improvement property. Known as the “Retail Glitch”, the technical correction would allow certain improvements to nonresidential real estate, qualified improvement property, to not only have a 15 year asset life but also subject to 100 percent bonus depreciation.
We will continue to monitor the status of The CARES Act and provide updates as information becomes available.
For our previous post on The CARES Act, click here.