CARES Act Translation for Business Owners

Coronavirus, Aid, Relief and Economic Security (CARES) Act

Congress and the President designed provisions of the CARES Act to provide approximately $877 billion of relief to businesses. Since this is the largest relief package in the history of the United States, we wanted to provide a CARES Act translation for business owners. You’ll find the most relevant provisions summarized below to assist in determining applicability to your circumstances.

Key CARES Act provisions for business owners could be instrumental for recovery during our country’s current crisis. There will likely be a combination of relief options for consideration.

Refundable Employee Retention Credit

The CARES Act provides a refundable payroll tax credit to impacted employers who continue to pay employees their wages. The refundable tax credit is equal to 50 percent of the qualified wages paid by an eligible employer to an employee from March 13, 2020 to December 31, 2020. The maximum amount of wages eligible to be considered for the credit is $10,000 per employee.

Eligibility: The employer must have either:

  • Suspended or reduced business operations due to a government order regarding COVID-19; or
  • Sustain a 50% or more decline in gross receipts for the comparable calendar quarter from 2020 to 2019. Once eligible, the employer remains eligible for succeeding quarters until gross receipts during a calendar quarter are 80% or more of the gross receipts in the comparable calendar quarter in the preceding year. The credit is also available to certain tax-exempt organizations.

The credit must be reduced by any credits claimed under the Families First Coronavirus Response Act which provides paid sick leave and paid family and medical leave.

Delay of Employer Payroll Tax Payments

The CARES Act allows employers (and self-employed individuals) to defer payment of the 6.2 percent employer-side Social Security payroll tax, effective for wages paid between the March 13, 2020 and December 31, 2020. Payment ultimately would be due in equal parts on December 31, 2021, and December 31, 2022.

Net Operating Loss Carryback Allowed

The CARES Act allows taxpayers to carry back net operating losses (NOLs) arising in 2018, 2019, and 2020 to the five prior tax years. NOLs incurred in these years can fully offset prior-year taxable income or be carried forward. These provisions change the Tax Cut and Jobs Act (TCJA), which generally eliminated all carrybacks and provided that the NOLs arising in years beginning after December 31, 2017 are only carried forward and deductible against only 80 percent of taxable income.

Enhanced Refundability of Previously Generated AMT Credits

The TCJA repealed the corporate alternative minimum tax (AMT) but continued to allow corporations to recover previously generated AMT credits against regular tax before 2022. The CARES Act generally enables corporations to accelerate any remaining AMT credits they have not yet utilized into 2019.

Enhanced Interest Deductibility

The TCJA generally limited the deduction for business interest expense to business interest income plus a threshold amount of 30 percent of “adjusted taxable income” (a defined term). The CARES Act provides that, for 2019 and 2020, the percentage of adjusted taxable income threshold would be increased from 30 percent to 50 percent. The CARES Act also provides special rules for deductibility of interest expense for partnerships. This provision also allows businesses to use their adjusted taxable income from 2019 in tax year 2020 in order to deduct more interest.

TCJA Technical Correction for Qualified Improvement Property

The TCJA inadvertently failed to define qualified improvement property (i.e. leasehold improvements) as 15-year property for MACRS depreciation purposes resulting in a 39-year depreciation period. The CARES Act corrects this mistake and classifies qualified improvement property as 15-year property and eligible for current law 100 percent bonus depreciation. This correction is retroactive to the effective date of the TCJA, so a refund could be claimed for property placed in service dating back to 2018.

Modification of Charitable Limitations

The CARES Act increases a corporation’s limitation on charitable deductions for 2020 from 10 percent to 25 percent of the corporation’s taxable income. This provision applies only to cash donations and is not applicable to donations to a donor-advised fund.

Extension of Plan Funding Deadlines

Employer sponsors of qualified defined benefit plans can postpone the funding of any plan contributions with a due date in 2020 until January 1, 2021.

Small Business Loans Through the Paycheck Protection Program

The CARES Act, utilizing the Small Business Administration (SBA), creates a loan program to assist small businesses and nonprofits with payroll support (including paid sick and medical leave), mortgage payments, lease payments, insurance premiums, interest payments and utility payments.

Eligibility: To be eligible, the business must:

  • have less than 500 employees;
  • have been operational on February 15, 2020;
  • have employees (or independent contractors) to whom it paid wages;
  • have been substantially impacted by COVID-19 (not defined).

Loan Amounts and Terms: The loan amounts are 2.5 times the business’s average monthly payroll costs (including medical and retirement benefits) for the trailing 12 months. The maximum loan amount is limited to $10 million. However, it seems that these payroll costs do not include the compensation paid to an employee (or an independent contractor) who made in excess of $100,000 during the 12-month period.

The terms of the loan are very favorable and include:

  • Interest not to exceed 4%;
  • Term up to 10 years;
  • Deferred interest and principal of up to 6-12 months;
  • No personal guarantee;
  • No collateral;
  • Origination fees reimbursed by SBA;
  • No prepayment penalty.

Potential Forgiveness: Principal can be forgiven in an amount equal to the payroll costs, mortgage payments, lease payments and utilities incurred from February 15, 2020 through June 30, 2020 for. Any amounts forgiven will be reduced proportionately by any reduction in the number of employees retained compared to the prior year and reduced by the reduction in pay of any employee beyond 25 percent of their prior year compensation. Employers that re-hire previously laid off employees will not be penalized for having a reduced payroll at the beginning of the period. Most importantly, any forgiven indebtedness will not be taxable income to the employer.

The Paycheck Protection Program has a lot of uncertainties and many provisions require greater clarity. This program looks to get cash into the hands of businesses quickly, so clarifications should be available soon. It’s also being administered by retail banks, so they also may have different interpretation of how to implement this program.


We hope this CARES Act translation for business owners will be beneficial to your company. If you need further clarification about any of these provisions, please don’t hesitate to reach the wealth managers of Budros, Ruhlin & Roe.

John Schuman

Co-CEO and Chief Planning Officer

CARES Act Translation for Individuals

Coronavirus, Aid, Relief and Economic Security (CARES) Act

Congress and the President passed the largest relief package in the history of the United States into law, estimated to cost over $2 trillion. Given the breadth of the relief provisions, we thought it important to provide a CARES Act translation for individual taxpayers. There is approximately $560 billion of relief available to individual taxpayers.

Direct Cash Relief

The CARES Act provides direct cash relief to individuals in the form of “recovery rebate” checks issued through the IRS with base amounts of $1,200 for single taxpayers and $2,400 for joint filers. Those amounts increase by $500 for every qualifying child. A qualifying child is a dependent of the taxpayer who is under age 17, including a son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, or a descendant of any of them.

These relief amounts begin to phase out when adjusted gross income (AGI) exceeds $75,000 for single taxpayers and $150,000 for joint filers. Payments are reduced by $5 for each $100 by which a taxpayer’s AGI exceeds the phase-out threshold, and relief phases out completely when a taxpayer’s AGI exceeds $99,000 (for single filers) or $198,000 (for joint returns).

A taxpayer’s AGI for the phase-out calculation would be based on a taxpayer’s 2019 federal income tax return if it has been filed. If a 2019 return has not been filed, AGI would be based on the taxpayer’s filed 2018 return.

Increased Access to Retirement Funds

Withdrawals: The CARES Act waives the 10 percent early withdrawal penalty (those under 59½) for distributions of up to $100,000 from qualified retirement plans to cover emergency expenses related to the coronavirus.  Income tax on the distributions is payable over three years, and withdrawn amounts can be recontributed within three years.

Loans: The CARES Act allows participants to take plan loans during the 180-day period beginning on the date of enactment and up to $100,000 or 100% of the account balance. Typically, plan loans are limited to $50,000 or 50% of the account balance. The loan can be repaid over six years, instead of the typical five years.

To be eligible for withdrawal or loan relief, an individual must be:

  • Diagnosed with COVID-19;
  • Have a spouse or dependent diagnosed with COVID-19; or
  • Experiencing financial hardship as a result of being quarantined, furloughed, or laid off; a reduction in work hours; inability to work due to lack of child care due to COVID-19; the closing or reduction in hours of a business owned or operated by the individual due to COVID-19; or other factors as determined by the Treasury Secretary.

Suspension of Required Minimum Distributions

The CARES Act suspends all required minimum distributions from IRAs, annuities under 403(a) and 403(b), retirement accounts for 2020. This applies to plan participants as well as beneficiaries of an inherited account. In addition, the year 2020 doesn’t count for any distribution requirement subject to a five-year payout.

Extension of IRA Contribution Deadline

Although not part of the CARES Act, it’s worth reminding that the IRS has extended the due date for any contributions to an IRA until July 15, 2020. It is implied that this extension applies to all various forms of IRAs, including Roth, SEP and simple IRAs.

Expanded Rules for Charitable Deductions

For 2020, the CARES Act temporarily eliminates the current 50% of AGI limitation on deductions for charitable contributions by individuals who itemize their deductions. Taxpayers can use charitable contributions to deduct up to 100% of their AGI. For non-itemizers, the CARES Act provides an above-the-line deduction of up to $300 for cash contributions to charities in 2020.

Expanded Exclusion for Employer-Provided Educational Assistance 

The CARES Act permits employers to pay up to $5,250 annually to provide a studTent loan repayment benefit to employees on a tax-free basis. The $5,250 cap applies to both the new student loan repayment benefit as well as other educational assistance (for example, tuition, fees, books) provided by the employer under current law. The provision applies to any student loan payments made by an employer on behalf of an employee after the date of enactment and before January 1, 2021.

Health Care-Related Tax Provisions

The CARES Act provides that Health Savings Accounts and Archer Medical Savings Accounts can be used to pay for menstrual care products as eligible expenses. Additionally, the CARES Act states that such accounts can be used for the reimbursement of such expenses incurred after December 31, 2019.


These highlighted provisions are a CARES Act translation for individual taxpayers and create new planning opportunities. We carefully review and discuss how they can benefit our clients and families.  If you don’t have a trusted wealth manager helping you in this way, give Budros, Ruhlin & Roe a call.

John Schuman

Co-CEO and Chief Planning Officer

Your future self says, “Don’t panic, this is temporary.”

School closings, travel restrictions, grocery store supply issues and much more time spent at home have increased uncertainty, which sparked some dramatic market volatility. We’ve seen multiple days of negative market returns over the past few weeks and as much as we’d like to pinpoint when the volatility will subside, the reality is that no one has a crystal ball.

However, what we DO know is that this is not the first time we have seen volatility in the market, and it likely won’t be the last. It is critical to remember this is not the time to panic and we are here to help you weather the storm.

Resist the urge to mess with your 401(k)

We understand that when individuals and their families experience financial strain, it may be tempting to take funds out of your 401(k) to get by. This takes the focus off long-term planning and could be very detrimental to your retirement savings.  Our guidance is to evaluate all potential sources of cash before tapping into these funds.

One of the most powerful investment concepts is the power of compounding returns. Compounding returns simply means when the money in your account grows over time, future growth is based on not only the amount of money you originally contributed, but also includes past returns. When you leave your money invested, you give your investments the chance to compound their returns and grow exponentially over time. If you take money out of your account, the magic of compounding returns disappears.

One study shows that by taking a $5,000 loan early in your career you could reduce your retirement savings by 20%.1 When you’re years away from retirement, it may feel like you have plenty of time to make up your contributions at a later time, but this should be considered a last resort in the hierarchy of financial solutions.

Let history show you the course.

Many investors try to ‘time’ the market by trying to sell as prices fall and buy back at lower prices.  The reality is that if you sell investments in your 401(k) and move them to cash equivalent funds, you are likely locking in the loses that have already taken place in your account.

The key to a successful retirement account has and always will be to invest for the long-term and to stay the course. In other words, don’t make changes to your strategy when you get anxious. In the past 20 years, six of the best ten days in the market have occurred within two weeks of the ten worst days.2 It is easy to let emotions get the best of us when we see concerning headlines on a day-to-day basis but we need to remember why we save in a 401(k).

The savings in your 401(k) are intended to give you security during retirement, when you may have upwards of 20 years of expenses to cover after you enter this stage of life. Your future self will thank you for finding other resources to cover short-term expenses during market or health crises.

Your team at Budros, Ruhlin, & Roe is here as a resource during these trying times. Please reach out to Hannah Walls or Eric Shisler if we can be of assistance with questions relating to your 401(k).

Hannah Walls, CRPS®

Retirement Plan Services Specialist



2 JP Morgan Guide to Retirement, 2020

Leverage the Fed’s interest rate cut for your financial advantage

The Federal Reserve announced an emergency interest rate cut of one-half of a percentage point, reducing the U.S. federal funds’ rate to a range of   1-1.25 percent. While the primary goal of the rate cut was to stabilize the economy after fears surrounding the coronavirus, it has an impact on nearly everything. You’ll want to understand how to leverage the Fed’s interest rate cut for your financial advantage before making a change to mortgages, auto loans, student loans, and checking and savings accounts.


Mortgage interest rates are currently at or near all-time lows. This may beg the question, should I refinance my mortgage? While the thought of a lower interest rate may be attractive, there are other factors to consider before starting the process.

Start by comparing the interest rate spread between your current mortgage and current interest rates. Refinancing can be attractive when the interest rate spread is equal to or greater than one-half of a percentage point.

Next, evaluate the closing costs and how long it will take you to break even on your closing costs. Also decide how long you plan on living in your home. If you have an adjustable rate mortgage and you plan on living in your home longer than the initial fixed interest term, it is certainly worth looking into either refinancing into a new adjustable-rate mortgage that is better aligned or a fixed-rate mortgage that provides more flexibility. If you do not plan on living in your home long enough to breakeven on your closing costs, it probably does not make sense to refinance.

Auto Loans

Auto loans have fixed interest rates that are tied to Treasury yields, however, falling rates will likely not predict what dealers and auto lenders will offer. If you are in the market for a new or used car, consider securing bank financing before going to the dealership. Bank financing may allow you to better take advantage of currently low interest rates.

Student Loan Refinancing

Do you have high-interest student loans? Has your income or credit increased significantly since you last refinanced your student loans? If you answered yes to either of these questions, now may be a good time to consider refinancing your student loans.

Interest rates being at or near all-time lows could reduce your monthly payment amount and/or your remaining loan term. If you have federal student loans, keep in mind that refinancing with a private lender may forfeit benefits such as potential loan forgiveness, lower repayment plans, deferment and forbearance.

Checking and Savings

Lower interest rates typically mean that any balances in your checking or savings accounts will earn less interest. These accounts should not see much impact by lower interest rates, as they are currently yielding next to nothing. However, if you have a high balance in your checking or savings accounts, you should consider opening a high-yield, online savings account. While these accounts are also subject to lower interest rates, they continue to yield more than one percent to one and one-half percent more than a typical checking or savings account.

Use these tips when evaluating how to leverage the Fed’s interest rate cut for your financial advantage.  If you’re a high-income earner looking for additional guidance in debt reduction, investment management, tax and estate planning or asset allocation, the advisors at Budros, Ruhlin & Roe are here to help.  Our program called GROWwithBRR can address uncertainties about building your financial future.

Kevin Wuebker, CFP®

Senior Wealth Manager



Forbes Names Dan Roe #8 on Best-In-State Wealth Advisor List

Forbes honored Co-CEO and Chief Investment Officer Dan Roe with a #8 ranking in its 2020 Best-In-State Wealth Advisors list for Ohio. He’s the first advisor listed for Columbus out of 131 named and thousands considered in the state.

SHOOK Research chose each advisor based on an algorithm of qualitative and quantitative criteria, including interviews, industry experience, compliance records, revenue and assets under management.  Advisors do not pay a fee for placement on the list.

Congratulations, Dan, on this industry recognition by one of the most respected financial media outlets in the U.S.

Daniel B. Roe, CFP®

Chief Investment Officer | Co-CEO

The Forbes ranking of Best-In-State Wealth Advisors, developed by SHOOK Research, is based on an algorithm of qualitative criteria, mostly gained through telephone and in-person due diligence interviews and quantitative data. Those advisors who are considered have a minimum of seven years’ experience, and the algorithm weights factors like revenue trends, assets under management, compliance records, industry experience and those that encompass best practices in their practices and approach to working with clients. Portfolio performance is not a criterion due to varying client objectives and lack of audited data. Neither Forbes nor SHOOK receive a fee in exchange for rankings. For more information, please visit:


April Tax Strategy Deadlines That You Thought Were in December

If the holidays hindered your best tax-efficiency intentions, take heart.  There are areas where you have until the 2020 tax filing deadline to take action, overriding a December 31, 2019 deadline assumption. Here are two, last-minute tax saving strategies of which you can still take advantage.

Traditional IRA Contributions

One last-minute, tax saving strategy is contributing to your traditional IRA.  If you were younger than 70-½ on December 31, 2019 and had earned income for the year, the IRS allows you and/or your spouse (even if he or she has no earned income) to make traditional IRA contributions up until the tax filing deadline of April 15, 2020. The age restriction on traditional IRA contributions has been removed for 2020 and beyond, thanks to the recently passed SECURE ACT.

The maximum contribution for 2019 is $6,000, or $7,000 if you were age 50 or older last year.  These contributions are fully deductible, unless you or your spouse are covered by a retirement plan at work.  In that case, the deductibility of these contributions is subject to certain income limits.

If you are single and covered by a retirement plan at work, the deduction completely phases out if your Modified Adjusted Gross Income (MAGI) exceeds $74,000.

For couples, if you file jointly and you are covered by a retirement plan at work, your deduction completely phases out if your combined MAGI exceeds $123,000.  If you’re not covered by a retirement plan at work, but your spouse is, your deduction completely phases out if your combined MAGI exceeds $203,000.

It’s worth noting that even if your traditional IRA contribution is non-deductible, or only partially deductible, it still offers additional advantages in terms of tax-deferred growth and future Roth conversion opportunities.

Health Savings Accounts (HSAs)

Another last-minute, tax saving strategy is contributing to your HSA. If you have a high-deductible health insurance plan through work (deductible of at least $1,350 for single coverage or $2,700 for family coverage, with an out-of-pocket maximum of $6,750 and $13,500, respectively), you are eligible to contribute to an HSA up until the tax filing deadline of April 15, 2020.  You can contribute up to $3,500, if you have single healthcare coverage, or up to $7,000 for family coverage.  If you were 55 or older at any time during 2019, you can contribute an additional $1,000 to your HSA.

The contributions you make are 100% tax deductible but be sure to take into account any contributions your employer might make on your behalf.  Employer contributions count towards the maximum contribution limit and cannot be deducted on your return.  Regardless, contributing to your HSA remains one of the best tax strategies available.  Your personal contributions not only save you taxes on the front end, but also grow tax-free and come out tax-free if used for qualified medical expenses.

Not surprisingly, the ability to adjust your taxes diminishes considerably after the tax-year ends, so the best course of action is to begin thinking about tax savings strategies early in the year.  The advisors at Budros, Ruhlin & Roe are well-versed in the intricacies of tax planning and consider it a valuable, ongoing piece of comprehensive wealth management.   We often partner with your existing accountant to leverage our collective skills and arrive at the very best tax strategies to benefit you and your family.  If you or someone you know is looking for guidance with wealth and tax planning, we would welcome a conversation to identify how we can help.

Michael Kline, CFP®

Senior Wealth Manager