The Coronavirus Aid, Relief, and Economic Security (CARES) Act—Tax Relief for Individuals and Businesses

"Congress is considering a number of proposals that seek to mitigate the economic effects of the Coronavirus disease 2019, or COVID-19, pandemic. One such proposal, the Coronavirus Aid, Relief, and Economic Security (CARES) Act (S. 3548), was introduced in the Senate on March 19, 2020. On March 22, 2020, an updated version of the CARES Act was circulated, as a proposed amendment to H.R. 748. A cloture vote on a motion to proceed, which was designed to allow consideration of the CARES Act, was rejected on March 22.1 A third version of the CARES Act was released on March 25, 2020.2 On March 25, the Senate voted 96-0 to pass H.R. 748, having previously amended it with the CARES Act. The House passed this version of the CARES Act on March 27, 2020, and President Trump signed the CARES Act (P.L. 116-136 ) into law.

Tax relief for individuals and businesses in the CARES Act includes

  a one-time rebate to taxpayers;
  modification of the tax treatment of certain retirement fund withdrawals and charitable contributions;
  a delay of employer payroll taxes and taxes paid by certain corporations; and
  other changes to the tax treatment of business income and net operating losses.

This is the latest in a series of legislative packages addressing the COVID-19 pandemic. Two other bills have been enacted into law: the Coronavirus Preparedness and Response Supplemental Appropriations Act, 2020 (P.L. 116-123) and the Families First Coronavirus Response Act (P.L. 116-127).

On March 23, 2020, an alternative to the CARES Act, the Take Responsibility for Workers and Families Act (H.R. 6379), was introduced in the House. For more information on the tax provision in this proposal, see CRS Report R46283, The Take Responsibility for Workers and Families Act: Division T—Revenue Provisions, coordinated by Molly F. Sherlock..."
Coronavirus,CARES