|Here’s a quick note about the new economic relief package that Congress passed just yesterday. The Consolidated Appropriations Act, 2021 comes in at over 5,000 pages and the NorthStar Team has been totally nerding out on it!
What’s in the box?
Who is eligible for the stimulus payments?
While dependent children under 17 will also receive $600 each, it doesn’t appear that adult dependents like college students or elders qualify for the payments.
If your family added dependents in 2020 or you earned too much in 2019 to qualify (but would qualify in 2020), you may not receive full payments immediately but can request additional money once you file your 2020 taxes. If you qualified based on your 2019 income but your 2020 income would have reduced your payment, you won’t have to pay it back; nor will it count as taxable income.
How do I claim a stimulus payment?
While the IRS hasn’t released a timeline for sending out payments, it’s possible electronic payments could start before the end of the year. When the last round of stimulus passed, the IRS began distributing payments two weeks later; however, plenty of eligible folks still haven’t received them many months later.3
What else do I need to know?
Small business relief: Congress included another round of relief for small business owners by extending the Paycheck Protection Program with another $284 billion in forgivable loans. Some of the funds will be set aside for very small businesses, and the PPP is now available to nonprofits and local media outlets.4
An extra $20 billion has also been appropriated for Economic Injury Disaster Loans for businesses in low-income communities, and $15 billion more is earmarked for live venues, movie theaters, and cultural institutions that have been financially damaged by the pandemic.
The deal also clarifies that PPP borrowers will be able to deduct expenses paid for with forgiven loans, clearing up a potentially nasty tax issue.
Unemployment benefits: The package also extends unemployment benefits of $300/week for another 11 weeks, beginning as early as December 27 and lasting at least until March 14, 2021. A benefits program specifically for contract and gig workers that was slated to expire at the end of the year is also extended through March.
What should I do with my payment?
If you’re among the very fortunate who don’t need to shore up your finances, we’d recommend putting it toward your retirement savings, other financial goals, or investing it in yourself through a course or hobby. Or even better, donate it to your favorite charity.
That’s it for now. We hope you and your loved ones are safe, warm, and well.
Questions? We’re here. Reach out at (704) 350-5028.
Happy Holidays and Warmest Wishes!
P.S. Wherever there’s money, there are scammers after it. Please be on alert for “official-looking” emails asking you to open an attachment or click a link—they may contain malware. If you get a suspicious email, check the sender’s name and email address to make sure they’re not fake. When in doubt, delete the email. The IRS or Treasury department will not require you to follow emailed instructions to receive a stimulus check.
P.P.S. Some great news to share: 556,208 folks were vaccinated against COVID-19 in the first week! That’s the power of human ingenuity and collective effort. We’re so grateful to be seeing some light at the end of this dark tunnel!5
This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific situation with a qualified tax professional.
It’s been a long journey to reach this election day and, if you’re like me, you’re plenty tired of the relentless politicking.
Case counts are rising around the country and winter is coming (34F overnight here in the Queen City of Charlotte).
A stimulus deal to help the folks who are scraping by seems stalled.
Markets are down (and up and down).
It’s hard to feel positive some days.
I’ve been noodling with a question I’d like to ask you.
When we take a look at 2020, it’s easy to see it as a long string of disasters, one after another.
And the last year has exacted a terrible cost. In lives cut short and dreams shattered.
But what if we look for the good stuff that happened as well?
Sometimes, it’s hard to remember the good things because they slip in quietly and often go unnoticed.
While the bad news announces itself loudly, instantly, and overwhelmingly.
What if we paused to ask: what good has come to my life because of this year?
I’m grateful for the additional time spent with my wife Rita and our children. It’s so easy to get caught up in the shuffle of work, school, activities, travel, and everything else. I’m glad we had the opportunity to slow down and make each other our refuge.
I developed a new appreciation for my neighbors in SouthPark. We were all thrown together during lockdown and I’m grateful for the opportunity to have gotten to know them better (especially John in the house across the street who generously introduced me to the joys of mechanized leaf removal).
I reconnected with old astronomy and physics major friends from the University of Virginia over Zoom. We’d drifted apart over the years and I’m glad we could catch up.
I think our grand experiment in remote work is going to yield big benefits to our society.
What good things came about in your life?
Will you share them with me (email@example.com)? I’d love to know. Hearing good news helps us all stay positive and moving forward.
|Chris Mullis, Ph.D., CDFA®
We’re not writing about cappuccinos, champagne, or bubble bath.
We’re talking stocks.
You may have noticed that the shortest bear market in history is over, and markets recently hit new record highs.
Will stocks keep going higher? Will they stay volatile?
Is another bear market around the corner?
Maybe. Maybe not.
As is pretty common in these situations, market strategists are split.
Some see a new bull market that reflects a recovering economy.1
Others see troubling signs of a bubble that could burst.2
What could push stocks higher?
What warning signs are flashing?
Bottom line, we can’t predict what comes next in the market and that’s okay. Why? Because it’s all short-term “noise.” History shows that all stock market declines are temporary interruptions in a perennial uptrend.
Since we no one can predict the future and no one can time the market, we’re focused on helping our clients stay fully invested which is the only sure way to capture the entirety of the market’s permanent advance. Those powerful portfolio returns over the long term are the reward for staying calm.
2020 has been the strangest year of our lives (probably yours, too), and it’s foolish to try to time markets right now — or any time for that matter. If you’re thinking about big moves or feeling anxious about what comes next, please reach out. We’ll talk through your ideas or concerns.