Newsletter - 03/30/2020

Dear Customers,

I hope that you and your family members are all safe and healthy.  For this week’s update, I will like to touch on a few items;

• The continuity plan of Mayfield Financial Services
• Key individual provisions of the CARES Act
• Department of Labor update for paid Sick Leave and expanded Family and Medical Leave under the Families First Coronavirus Response Act
• Banking Updates
• Unemployment

The Continuity Plan of Mayfield Financial Services

As you may know, we have been classified as an “Essential Business” and will continue to remain open and operational to continue to assist and serve you.

Over the past few years we have put in place the technology that you may have already experienced, allowing our Team Members to work virtually.  Today most of our Team Members work from their home providing the same service that we always have provided.

It is also important for me to mention the financial strength of Mayfield Financial Services.  We have sufficient cash reserves and no debt, allowing us to keep all Team Members employed and the lights on for a very long time.  With all the changes in the world and the many new laws, we have the full team working for you, and we are prepared.  Please be aware that all Team Members will be working extra hard to navigate the changes and hurdles that lie ahead for all of us.   

Key Individual Provisions of the CARES Act

Tax Updates

• The federal income tax filing due date for 2019 tax returns is automatically extended from April 15, 2020 to July 15, 2020.
• Taxpayers can also defer federal income tax payments due on April 15^th to July 15^th without penalties and interest, regardless of the amount owed. This deferment applies to all taxpayers, including individuals, trusts and estates, corporations and other non-corporate tax filers as well as those who pay self-employment tax
• Taxpayers who need additional time (October 15, 2020) beyond the automatic extension will still need to request one using the appropriate form (Form 4868 or Form 7004)
• The IRS encourages taxpayers who are due a refund to file as soon as possible. Most tax refunds are still being issued within 21 days
• The 2019 IRA contribution deadline has also been moved up to July 15, 2020
• The 2019 HSA contribution deadline has also been moved up to July 15, 2020
• As of March 27^th, the state of Ohio will be following the federal government and IRS in extending the deadline to file and pay the state income tax
  • As with the IRS extension, Ohio will be waiving penalty on tax due payments made during the extension. There will also be no interest charges on payments during the extension
  • Filing extension, wavier of penalty and interest will be available to those filing Ohio individual income tax, the school district tax, the pass-through entity tax, and to those taxpayers that have opted into the centralized municipal filing system
• Individuals, estates, trusts and certain businesses making quarterly estimated income tax payments, have also been granted additional time to file and pay without penalty or interest.
  • The first and second quarterly payments, normally scheduled for April 15^th and June 15^th, have both been extended to July 15^th
• RITA – Municipal income tax returns and payments for the 2019 tax year have been extended to July 15, 2020. Estimated payments for the first and second quarters of 2020 have also been extended to July 15^th
  • No late filing or late payment penalties or interest will be imposed for these filings and payments

• Recovery Rebates The law provides a $1,200 refundable tax credit for individuals ($2,400 for joint taxpayers). Additionally, taxpayers with children will receive a flat $500 for each child. The rebates will not be counted as taxable income for recipients, as the rebate is a credit against tax liability and is refundable for taxpayers with no tax liability to offset. The rebate phases out at $75,000 for singles, $112,500 for heads of household, and $150,000 for joint taxpayers at 5 percent per dollar of qualified income, or $50 per $1,000 earned. It phases out entirely at $99,000 for single taxpayers with no children and $198,000 for joint taxpayers with no children. 2019 or 2018 tax returns will be used to calculate the rebate advanced to taxpayers, but taxpayers eligible for a larger rebate based on 2020 income will receive it in the 2020 tax season. Taxpayers with higher incomes in 2020 will see the overpayment associated with their rebate forgiven. For example, a single taxpayer with $100,000 in 2019 income would not receive an advance rebate but would receive the $1,200 credit on their 2020 return if their income for the year fell below the phase out. On the other hand, a single taxpayer with $35,000 in income receives a $1,200 advance rebate but would not have to pay the rebate back on the 2020 return if they make $100,000 this year.  This credit is one-time, but policymakers may consider additional rebates if the downturn is prolonged.

For some taxpayers, we are delaying the filing of their tax returns so that we maximize their recovery rebate.

• 2020 Required Minimum Distributions (RMD’s) Required Minimum Distributions are suspended for 2020. You may recall that during the last financial crisis, when the stock market crashed, Congress suspended RMD’s for 2009.  You are required by law to take withdrawals from your IRA, SIMPLE IRA, SEP IRA or retirement plan such as a 401(k) once you reach 72. (It was 70½ before 2020.) But the CARES Act waives RMD payments for 2020, including for inherited IRAs. Additionally, the waiver covers the first RMD, which individuals may have delayed from 2019 until April 1, 2020.  You have until April 1 of the following year after reaching the required RMD age to take your first RMD payment. This deadline applies to the RMD only for the first year. Every year thereafter, you have to take your distributions by Dec. 31.

If the 2020 RMD’s had not been waived, you likely would have had to withdraw a greater percentage of your IRA or plan balance and pay a big tax bill on value that no longer exists.  So, it is good Congress gave us all a year off to sit this out and see what happens, and hopefully have more time to recover losses.

• 10 Percent Early Withdrawal Penalty on Retirement Account Distributions is Waivedfor taxpayers facing virus-related challenges. Withdrawn amounts are taxable over three years, but taxpayers can recontribute the withdrawn funds into their retirement accounts for three years without affecting retirement account caps. Eligible retirement accounts include individual retirement accounts (IRAs), 401(k)’s and other qualified trusts, certain deferred compensation plans, and qualified annuities.

• Access to 401(k) Savings To qualify for the provisions, individuals need to fall into one of two main categories. First, you, your spouse or a dependent is diagnosed with Covid-19, the disease caused by the new coronavirus. Second, you qualify if you have experienced adverse financial consequences as a result of being quarantined, furloughed, laid off, having work hours reduced, being unable to work due to lack of child care or closures related to the coronavirus pandemic.

Hardship Withdrawals and Loans Eligible individuals can withdraw up to $100,000 from their retirement accounts, in total, without penalty as long as they pay back the distributions within three years.  The relief package also doubles the current retirement plan loan limits to the lesser of $100,000 or 100% of the participant’s vested account balance in the plan. Individuals with a loan outstanding from their plan with a repayment due from the date of enactment of the Cares Act through Dec. 31, 2020, can delay their loan repayments for up to one year.

Department of Labor update for paid Sick Leave and expanded Family and Medical Leave under the Families First Coronavirus Response Act

• The Families First Coronavirus Response Act (FFCRA or Act)requires certain employers to provide employees with paid sick leave or expanded family and medical leave for specified reasons related to COVID-19. The Department of Labor’s (Department) Wage and Hour Division (WHD) administers and enforces the new law’s paid leave requirements. These provisions will apply from the effective date through December 31, 2020.

Generally, the Act provides that employees of covered employers are eligible for:

• Two weeks (up to 80 hours) of paid sick leave at the employee’s regular rate of pay where the employee is unable to work because the employee is quarantined (pursuant to Federal, State, or local government order or advice of a health care provider), and/or experiencing COVID-19 symptoms and seeking a medical diagnosis; or
• Two weeks (up to 80 hours) of paid sick leave at two-thirds the employee’s regular rate of paybecause the employee is unable to work because of a bona fide need to care for an individual subject to quarantine (pursuant to Federal, State, or local government order or advice of a health care provider), or to care for a child (under 18 years of age) whose school or child care provider is closed or unavailable for reasons related to COVID-19, and/or the employee is experiencing a substantially similar condition as specified by the Secretary of Health and Human Services, in consultation with the Secretaries of the Treasury and Labor; and
• Up to an additional 10 weeks of paid expanded family and medical leaveat two-thirds the employee’s regular rate of pay where an employee, who has been employed for at least 30 calendar days, is unable to work due to a bona fide need for leave to care for a child whose school or child care provider is closed or unavailable for reasons related to COVID-19.

Covered Employers: The paid sick leave and expanded family and medical leave provisions of the FFCRA apply to certain public employers, and private employers with fewer than 500 employees.   

Small businesses with fewer than 50 employees may qualify for exemption from the requirement to provide leave due to school closings or child care unavailability if the leave requirements would jeopardize the viability of the business as a going concern.

Eligible Employees: All employees of covered employers are eligible for two weeks of paid sick time for specified reasons related to COVID-19. Employees employed for at least 30 days are eligible for up to an additional 10 weeks of paid family leave to care for a child under certain circumstances related to COVID-19.

Notice: Where leave is foreseeable, an employee should provide notice of leave to the employer as is practicable. After the first workday of paid sick time, an employer may require employees to follow reasonable notice procedures in order to continue receiving paid sick time.

Qualifying Reasons for Leave:

Under the FFCRA, an employee qualifies for paid sick time if the employee is unable to work (or unable to telework) due to a need for leave because the employee:

1. is subject to a Federal, State, or local quarantine or isolation order related to COVID-19;
2. has been advised by a health care provider to self-quarantine related to COVID-19;
3. is experiencing COVID-19 symptoms and is seeking a medical diagnosis;
4. is caring for an individual subject to an order described in (1) or self-quarantine as described in (2);
5. is caring for a child whose school or place of care is closed (or child care provider is unavailable) for reasons related to COVID-19; or
6. is experiencing any other substantially-similar condition specified by the Secretary of Health and Human Services, in consultation with the Secretaries of Labor and Treasury.

Under the FFCRA, an employee qualifies for expanded family leave if the employee is caring for a child whose school or place of care is closed (or child care provider is unavailable) for reasons related to COVID-19.

Duration of Leave:

For reasons (1)-(4) and (6): A full-time employee is eligible for 80 hours of leave, and a part-time employee is eligible for the number of hours of leave that the employee works on average over a two-week period.

For reason (5): A full-time employee is eligible for up to 12 weeks of leave (two weeks of paid sick leave followed by up to 10 weeks of paid expanded family & medical leave) at 40 hours a week, and a part-time employee is eligible for leave for the number of hours that the employee is normally scheduled to work over that period.

Calculation of Pay:

For leave reasons (1), (2), or (3): employees taking leave are entitled to pay at either their regular rate or the applicable minimum wage, whichever is higher, up to $511 per day and $5,110 in the aggregate (over a 2-week period).

For leave reasons (4) or (6): employees taking leave are entitled to pay at 2/3 their regular rate or 2/3 the applicable minimum wage, whichever is higher, up to $200 per day and $2,000 in the aggregate (over a 2-week period).

For leave reason (5): employees taking leave are entitled to pay at 2/3 their regular rate or 2/3 the applicable minimum wage, whichever is higher, up to $200 per day and $12,000 in the aggregate (over a 12-week period).

Banking Updates

Student Loans

Federal Student Loan Repayments Suspended Until September 30, 2020

All current federal direct loans will not need to be paid until September 30. This will take a few days for the loan servicers to implement and stop automatic withdraws. In August, you will begin to get notices from your federal loan servicer that payments will restart on October 1. There will a minimum of six notifications via a variety of methods. It is unclear at this time how recertification will work if you are using an Income-Driven Repayment (IDR) method during this suspension time frame.

These are only for the federal loans held by the federal government. Some federal loans are owned by private banks and colleges which will still need to be paid. Private student loans are also not included in the suspension. Contact your lender to see if they are offering a suspension program.

Student Loan Interest Charges are Suspended Until September 30, 2020

For all federal direct loans, there will be no interest charged from March 13 until September 30, 2020. This was extended from the initial two-month suspension.

Fifth Third Bank

• Offering assistance program to customers experiencing hardship regarding a mortgage, home equity line or loan, auto loan or credit card balance; encourages such customers to call the bank’s dedicated help line.
• Ensuring that critical functions continue in the event of any disruption, with policies, people and processes aligned to provide continuous service.
• Encouraging customers to access accounts via the bank’s digital banking tools including mobile, online and voice banking services.
• Offering a dedicated coronavirus help page to provide resources and keep customers informed.

Huntington

Small Businesses:

• Small Business Payment Deferral Program – If your small business is experiencing a hardship related to family sickness or workplace closures due to COVID-19 and you contact Huntington, we will offer a payment deferral for up to 90-days with no credit bureau impact.  Please contact your business banker or the Business Customer Phone Bank (800) 480-2001 Monday through Friday 7:30 a.m. to 7:00 p.m. and Saturdays 8:00 a.m. to 5:00 p.m. ET.
  Business Credit Card Payment Assistance – Contact the Business Credit Card Customer Assistance Team at (888) 696-9982
  Late Fees on Banking Business Loan Suspension Program – Beginning in March 2020, Huntington will suspend charging late fees on business loan payments. This suspension is effective through the end of March 2020 and we will continue to evaluate with considerations to extend this program.
• Small Business Economic Injury Disaster – Huntington is working directly with the Governor’s offices to facilitate a disaster declaration from the SBA for businesses to be eligible for Economic Injury Disaster loans.

Consumers:

• Consumer Payment Deferral Program – If you are facing a financial hardship related to sickness in your family or workplace closures due to COVID-19 and you contact Huntington, we will offer a payment deferral for up to 90-days with no credit bureau impact.
  Homeowner Payment Assistance – Contact (800) 323-9865, Monday through Friday 8:00 a.m. to 9:00 p.m. and Saturdays 8:00 a.m. to 1:00 p.m. ET
  
  Personal Credit Line Payment Assistance – Contact (800) 250-6660 Monday – Friday 8:00 a.m. to 7:00 p.m. ET
  Auto Loan Payment Assistance – Contact (866) 480-2234, Monday through Friday 8:00 a.m. to 9:00 p.m. and Saturdays 8:00 a.m. to 4:00 p.m. ET
  Consumer Loan Payment Assistance – Contact (877) 477-6855, Monday through Friday 8:00 a.m. to 9:00 p.m. and Saturdays 8:00 a.m. to 1:00 p.m. ET
  Credit Card Payment Assistance – Contact us Monday through Friday 8:00 a.m. to 9:00 p.m. and Saturdays 8:00 a.m. to 4:00 p.m. ET
• For payments that are current, contact (614) 480-6522
• For payments that are past due, contact (800) 372-7725
• Debit Card Assistance – Contact (800) 480-2265, Monday through Sunday 7:00 a.m. to 7:00 p.m. ET
• Late Fees on Consumer Loan Suspension Program – Beginning in March 2020, Huntington will suspend charging late fees on consumer loan payments. This suspension is effective through the end of March 2020 and we will continue to evaluate with considerations to extend this program.
• Repossession Halt Program – Beginning March 17, 2020, Huntington will not initiate any new repossession actions associated with vehicles, RVs, or marine craft financed by Huntington and have enacted reduced requirements for customers who want to redeem their already repossessed vehicle to one (1) payment plus repossession fee. This suspension of repossession actions will take place through the end of March 2020 and we will continue to evaluate with considerations to extend this program.
• Suspension of Foreclosure Program – Beginning March 17, 2020, Huntington will suspend initiating any new foreclosure actions, specific to residential properties unless required by federal or government agencies. This suspension of foreclosure actions will take place through the end of March 2020 and we will continue to evaluate with considerations to extend this program.
  Find out more: https://www.huntington.com/coronavirus#faq

JPMorgan Chase

• Encouraging individuals who are affected by COVID-19 and need help with their accounts to contact their customer service representatives.
• Relief is currently on case-by-case basis and could include fee waivers or refunds, changing due dates or extending credit lines.
• Urging customers to protect themselves from coronavirus-related scams. 
• Instituting/enhancing measures at branch and office locations to protect health of both customers and employee
• Encouraging customers to use online, mobile and voice banking services.

PNC

• Waive or refund late payment fees on mortgages, credit cards and other products.
• Waive fees for early withdrawal of CDs.
• Help business customers having difficulty making payments on loans.
• Offer low-rate, emergency hardship loans to qualified consumers and small businesses.

U.S. Bank

• Encouraging customers who need help right away to call a specified help line to discuss assistance.
• Urging customers to use its digital banking features, including its mobile app, online banking or banking by phone.

• National donations – $4 million to United Way, LISC and Operation HOPE to support individuals and small businesses affected by COVID-19. 

• Local donations – $26 million in general operating funds to local nonprofit organizations across the country to continue supporting individuals and families with financial education, affordable housing and work assistance. This includes employee donations, which U.S. Bank will double through matching gifts.
  

Wells Fargo

• Wells Fargo is working on a daily basis to put measures in place to support the needs of customers impacted by COVID-19 in the most effective ways possible. 
• Wells Fargo is suspending residential property foreclosure sales, evictions and involuntary automobile repossessions.
• The company also is offering fee waivers, payment deferrals and other expanded assistance for credit card, auto, mortgage, small business and personal lending customers who contact the company.  

Unemployment

Unemployment insurance provisions now include an additional $600 per week payment to each recipient for up to four months, and extend UI benefits to self-employed workers, independent contractors, and those with limited work history. The federal government will provide temporary full funding of the first week of regular unemployment for states with no waiting period and extend UI benefits for an additional 13 weeks through December 31, 2020 after state UI benefits end.

For our business owners, we will be providing you with an additional weekly update specifically geared towards the small business owner.

If you have someone that you care about – your friends, family members and colleagues – who may also be facing challenging questions and a complex situation, it would be our pleasure to help them navigate their situation through today’s environment.   Please have them call me at 440-449-7709 x 102, or email me at vince@mayfield1.com           .

We want to stay in touch and let you know that we are here for you!  If you have any questions or concerns, please do not hesitate to contact us.

May you and your family stay healthy and safe!

Vince