Home

Quick Links

Legal

navigation

Friday, April 3, 2020

Resources for Communities: COVID-19 Financial FAQs for the Elderly


Armanino LLP is providing this Frequently Asked Questions document as a resource to provide practical financial guidance during this turbulent time. It is not intended to be exhaustive and we recommend that anyone in need turns to their local social services providers for more advice.

For additional help, call 211, the most comprehensive source of locally curated social services information in the U.S. and most of Canada.

  1. Will there be enough cash during the COVID-19 pandemic? Do I need to keep large amounts of cash in my possession to protect myself?
    • The Federal Reserve System has and will continue to meet the currency needs of banking customers. You should continue to conduct financial transactions as you normally would. Keep in mind, cash is subject to loss and can make you a target for theft. The safest place for your money is inside an FDIC-insured bank and since 1933, no depositor has ever lost a penny of FDIC-insured funds.
  2. How do I get help with food costs?
    • Call 211 for referrals to food assistance, paying housing bills, accessing free childcare or obtaining help with other needs.
  3. When will I receive my stimulus check?
    • The Treasury Department and the Internal Revenue Service announced on March 30, 2020, that distribution of stimulus checks will begin on approximately April 20, 2020. They will be distributed automatically, with no action required for most people. Eligible taxpayers who filed tax returns for either 2019 or 2018 will automatically receive an economic impact payment of up to $1,200 for individuals or $2,400 for married couples. Parents also receive $500 for each qualifying child. The IRS defines “eligible taxpayers” as those with adjusted gross income up to $75,000 for individuals and up to $150,000 for married couples filing joint returns. For filers with income above those amounts, the payment amount is reduced by $5 for each $100 above the $75,000/$150,000 thresholds.
  4. How can I avoid financial fraud schemes?
    • The Federal Trade Commission cautions all households to beware of scams. Keep in mind: The government will not ask you to pay anything up front to get this money. The government will not call to ask for your Social Security number, bank account or credit card number. The CARES Act stimulus checks will not be sent until mid-April or even later. Anyone who says they can get you the money now or asks for your personal information is a scammer. Understand that some people may take advantage of COVID-19 by using fraudulent websites, phone calls, emails and text messages that claim to offer “help.” In addition, you should be cautious about online donation solicitations.
  5. Do I need to update my will?
    • There is no need to update your estate planning documents due to COVID-19. However, for anyone who does not currently have any estate planning documents, we highly recommend that you contact an estate planning attorney to put the following in place:
      • Will - to designate an executor and nominate a guardian for minor children
      • Living Trust - to avoid probate and keep the administration of your estate private
      • Advance Health Care Directive - to nominate a trusted individual to handle your health care wishes if you become incapacitated
      • Durable Power of Attorney - to designate a person to handle your financial affairs if you become incapacitated
    • If you are considering making a Roth conversion, this may be a good time as the values have come down significantly. For those who have taxable estates, this is a good time to utilize some of your lifetime exemption to transfer some assets to your descendants. Some options that are attractive in this low interest-rate environment include: transfers to irrevocable trusts, sales to intentionally defective grantor trusts, grantor retained annuity trusts, charitable remainder trusts and inter-family loans.
    • Finally, be sure to review the beneficiary designations for any retirement accounts, transfer on death (TOD) accounts and insurance policies. This will help you make sure you are protected in case of any unforeseen circumstances.
  6. What can I do if I can’t afford to pay my rent or my mortgage?
    • If you’re a renter, you may have heard about federal and state government mandates prohibiting landlords from evicting or charging late fees to tenants, ranging from 60-90 days. This does not mean that tenants get two months of free rent. Each landlord or rental management company will determine how to handle this situation, keeping in mind that delayed rent payments will likely be added onto future rent payments. If you know you will not be able to pay your rent, it’s mandated by some jurisdictions and a best approach to contact your landlord before you miss a payment, so they know you are keeping track and aware of the situation.
    • For homeowners, there is a 60-day delay on foreclosures for borrowers with federally-backed mortgage loans and six months forbearance for those experiencing economic hardships due to COVID-19. The U.S. Department of Housing and Urban Development (HUD)-approved housing counselors can discuss options with you if you’re having trouble paying your mortgage loan or reverse mortgage loan.
  7. What if I can’t afford to make my credit card or car loan payments?
    • Credit cards: The FDIC has encouraged banks to consider increasing credit card limits for creditworthy borrowers. The FDIC is also encouraging banks to consider waiving late payment fees on credit cards and other loans. Contact your bank or credit card provider immediately to see whether and how they can help you meet your financial needs.
    • Car loans: Several automakers are currently offering payment deferrals for customers experiencing financial hardship. Reach out to your car loan provider before you miss a payment and document who you speak to about possible solutions to the situation.
  8. What can I do if I’m not able to pay my taxes on April 15, 2020?
    • If you need more time to pay any federal or self-employment income taxes that you owe, the U.S. Treasury Department has extended the deadline to pay taxes until July 15, 2020. Tax payments can be delayed with this 90-day extension without incurring interest charges or fees. Before missing the April 15 deadline on other tax-related payments or contributions, check out this IRS website with updated filing and payment deadlines.
  9. There are unauthorized charges on my credit card. What should I do?
    • You should contact the bank at the address your credit card specifies (or through an alternative mechanism provided by the bank) and provide information regarding the disputed transactions no later than 60 days after the bank sent the first statement containing the disputed charges. The bank has 90 days to investigate and resolve the dispute. For more information about credit card dispute resolution procedures, see: https://www.fdic.gov/consumers/assistance/protection/errorresolution.html
  10. What can I do if someone steals my identity?
    • If you have reason to believe you may be a victim of ID theft, you may place a "fraud alert" on your credit file, by contacting the fraud department at one of the three major credit bureaus for which contact information appears below:
    • You only need to notify one credit bureau. The one that processes your fraud alert will notify the other two. Those two then must place fraud alerts in your file. Placing a “fraud alert” on your credit file can help prevent a thief from opening new accounts or making changes to your existing accounts.

The information contained herein is general in nature and based on regulations that are subject to change. The information is an overview only and should not be construed as legal or tax advice or advice to take any specific action. Individuals should consult with their personal tax/legal advisors before making any tax/legal-related decisions.

COMMENTS

comments powered by Disqus