Updated March 28, 2020
The coronavirus, also known as COVID-19, is impacting households, communities, and businesses. A new national survey shows that 1 in 5 households in the US have already had their income cut or stopped altogether. The frequently asked questions below highlight some common financial challenges as a result of the COVID-19 pandemic. The answer to each question has links to government websites and the types of assistance that might be available. We will be adding additional information as new policies and resources are put into place.
If you would like to talk to a financial or housing counselor about your situation, click here for the National Foundation for Credit Counseling (NFCC) website or call 833-746-7577. NFCC is a network of nonprofit consumer credit counseling agencies that provide services online and over the phone. You can also contact your local UW-Madison Extension office for more financial information. Click here to find your county Extension office. If you would like to get in touch with an Extension financial educator, contact one of our educators by clicking on this link.
- Start by creating a budget. List income or savings, if any, and your monthly bills.
- Prioritize your bills by what is most important to keep you safe – housing, food, utilities, your car, and whatever else you need. Write down your minimum payment due and when it’s due.
- Check out the ‘frequently asked questions’ on this page to find links to resources to help you make ends meet meanwhile. Resources depend on your situation and could include help with food, healthcare, utilities, rent, student loans, and more.
- As hard as it is, you need to let your creditors know about your financial situation. It’s best to contact your creditors before you miss a payment so they know you are keeping track and working on the situation. Check out the Extension publication on Dealing with a Drop in Income for steps to take in prioritizing bills and a script you can use to contact creditors about a payment plan. Be sure to keep track of everyone you talk with and any paperwork you share.
If you would like to get in touch with an Extension financial educator, please do contact one of our educators throughout Wisconsin by clicking on this link.
Usually, self-employed people, freelancers, and contractors can’t get unemployment, but the CARES Act passed on March 27, 2020 creates a new, temporary Pandemic Unemployment Assistance program to help these independent workers through the rest of 2020. Individuals eligible for unemployment benefits could also get an extra $600 a week for up to four months added on to their regular state benefits. Other guidelines around unemployment benefit eligibility and requirements are continuing to change as new resources are put into place, so continue to check with DWD for more information.
If you have been turned down for unemployment insurance and would like to talk with a lawyer about your situation, you can find free legal advice in Southern Wisconsin on the Legal Action of Wisconsin website or in Northern Wisconsin on the Judicare website.
A few tips from the SBA include:
- Their website has been experiencing a large volume of traffic, which could bump you off the site suddenly. When filling out an application online, save your information frequently as you enter it.
- Try to visit the website in early morning (7am) or the end of the day (after 5pm).
- If you currently have a freeze on your credit reports through Equifax, Experian, or TransUnion, you will need to temporarily lift that freeze when SBA completes a credit check on applicants. Click on the credit bureau names above for the website links to unfreeze your credit report if needed. You will need your PIN provided by each credit bureau to complete their process.
The Wisconsin Economic Development Corporation (WEDC) created a program to provide grants to small Wisconsin businesses with 20 employees or less to cover rent, meet payroll, and cover paid leave. Learn more about the Wisconsin SB20/20 grants on the WEDC website.
The Wisconsin Small Business Development Center (SBDC) has staff available to help small business owners work through the process of qualifying and applying for SBA disaster loans. Click here to go to the Business Development website to find information for filing on line or through mail, as well as links to other partners, including WWBIC, Western Wisconsin Women’s Business Center, Veterans Business Outreach Center, or SCORE. The Wisconsin SBDC business answer line is (800) 940-7232 or email email@example.com.
Small business owners can also reach out to their area Extension Community & Economic Development educator for more information, resources, and personal assistance.
At this time, payment checks will likely be based on your 2019 tax return, if you’ve already filed, or else the government will use your 2018 tax return. Payments would be sent to the direct deposit account used for your tax filing or to the address that was used last if no banking account information is on file. For anyone who does not pay taxes, the IRS would use information from the Social Security Administration which keeps earning records and an address for all US workers who have paid payroll taxes. It will take at least three weeks to begin distributing relief payments.
Most individuals who earned less than $75,000 will get a one-time payment of $1,200, with married couples getting $2,400 if they earned less than $150,000. Families would also get $500 for each ‘qualifying child.’ A person who has made too much money to qualify for these stimulus payments, but then had their income drop in 2020, would receive a tax credit when they file their 2020 income taxes. No relief payments will be garnished for back taxes and payments will not be taxed regardless of a person’s 2020 income. We will continue to update this website and links to resources as more details are put into place about relief payments.
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. No fees. No charges. Nothing.
- The government will not call to ask for your Social Security number, bank account, or credit card number. Anyone who does is a scammer.
- These checks will not be sent until mid-April or even later. Anyone who says they can get you the money now is a scammer.
- The FTC encourages anyone who is contacted by a scammer asking for your bank account number or Social Security number to file a complaint on their website using this link.
The Wisconsin Department of Revenue has also extended the state income tax filing deadline to match the Federal deadline of July 15, 2020. For income tax filers in Wisconsin, click here to go to the Department of Revenue website for links and information on filing state income taxes online or setting up a payment plan for state income taxes that are due.
The Internal Revenue Service has a special section focused on steps to help taxpayers, businesses and others affected by COVID-19. Click here to visit the IRS website. This IRS page will be updated as new information is available.
The 60-day freeze on evictions 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. Households who still have money coming in can certainly continue to make on-time monthly rent payments. If you know you will not be able to pay your rent, it’s best to contact your landlord before you miss a payment so they know you are keeping track and aware of the situation. Check out the Extension publication on Dealing with a Drop in Income for steps to take in prioritizing bills and contacting your landlord about a payment plan.
If you find that you won’t be able to make all of your next mortgage payment by the due date, you are still encouraged to contact your lender or servicer right away, before you miss your payment due date or make a partial payment. Your mortgage servicer is the company that sends you the bill for your mortgage payment. If you’re not sure who holds your mortgage, you can call the MERS Servicer Identification System toll-free at 888-679-6377 or visit the MERS website here. Write down all the steps you take, such as any phone calls you make and who you talk with, emails you send, and what types of information or documents you have shared. If you need help to figure out your options for catching up with future mortgage payments, contact a HUD-approved housing counselor through the Federal Making Home Affordable website.
The U.S. Department of Housing and Urban Development authorized the Federal Housing Administration to put a hold on foreclosures for single-family homeowners who are unable to pay their FHA-backed mortgages. This suspension of foreclosure filings is in place until May 17, 2020, and could be extended at the direction of the Federal Housing Financial Agency. Freddie Mac and Fannie Mae have laid out options for mortgage relief, with borrowers eligible for forbearance regardless of whether their property is owner-occupied, a second home, or an investment/rental property. You can also find a housing counselor and options to avoid foreclosure on the Freddie Mac website and on the Fannie Mae website.
Many provisions have also been put in place by USDA Rural Development to assist rural residents, communities, and business. Foreclosure and eviction moratoriums are in place for 60 days for Single-Family Housing Guaranteed Loan and Direct Loan programs, and for Section 515 Multi-Family Housing. Read more about the USDA community relief measures here.
NOTE: this order only includes PSC utilities and does not include utility co-operatives. You’ll need to contact your non-public utility provider for their disconnection policy or to set up a payment plan. Low income individuals who have at least one child in the house and are facing an emergency can apply for Emergency Assistance to pay a utility bill if their non PSC utility has been stopped. Parents can apply for Emergency Assistance through their local W-2 agency found on this Department of Children and Families website.
The Wisconsin Division of Energy, Housing and Community Resources provides services to Wisconsin qualified residential households with energy assistance and weatherization needs. For more information call 1- 866-HEATWIS (432-8947) or visit their website for information on where to apply in your area.
Click here to visit the Consumer Financial Protection Bureau website for tips and resources for working with creditors. As you plan for the potential impact of the coronavirus, there are a number of steps that you can take to help protect yourself or a loved one financially, both in the short and long term.
Additional federal student loan relief measures are currently being put into place as part of the CARES Act passed on March 27, 2020. For more information, click here to go to the Department of Education’s Federal Student Aid website. The website answers questions related to online classes and financial aid, getting paid for work study if no online work options are available, or requesting additional financial assistance if a student’s financial need has gone up. Your federal student loan servicer is the organization you make your monthly payment to. If you’re not sure who your servicer is, visit StudentAid.gov/login or call 1-800-4-FED-AID (1-800-433-3243).
To preserve GI Bill benefits, the Veteran’s Administration has the authority to continue GI Bill payments uninterrupted in the event of national emergencies. This law allows VA to pay education benefits regardless of the fact that a program has changed from resident training to online training. Also, you will continue to receive the same monthly housing allowance payments that you received for resident training until 12/21/20, or until the school resumes normal operations of resident training. To learn more about options related to the GI Bill benefits, contact the VA’s Education Call Center at 1-888-442-4551 between 8 AM and 7 PM Eastern Time, Monday-Friday, or visit the U.S. Department of Veterans Affairs website.
Any borrower who has experienced a change in income can contact their loan servicer to discuss lowering their monthly payment. Keep in mind that the student loan forbearance, repayment plans, or deferment options offered through the Department of Education only apply to federal student loans. If you have a private student loan through a financial institution, contact your loan servicer as soon as you think you may not be able to make a payment to find out what options they have to offer.
Different than a hardship withdrawal, the CARES Act also includes an increase in 401(k) loan limits where borrowers can access up to 100% of their vested account balance, but the loans will still need to be repaid within five years — or sooner if you lose or leave your job — along with interest and fees. Additional changes in the law let individuals age 72 or older delay taking required minimum distributions from retirement accounts in 2020, and also extends the 2019 IRA contribution deadline to July 15, 2020. The IRS has set up a web page to provide new guidelines as they become available.
Taking a hardship withdrawal or a loan after the recent stock market declines would lock in any losses in the retirement accounts value. If the worst should happen and a person needs to declare bankruptcy in the future, also keep in mind that retirement accounts are protected from creditors in a bankruptcy and can be used to start over. You can find more information on pros and cons of options to increase your income in Extension’s Increasing Your Income handout.
• Perform tasks essential to maintain health and safety, such as obtaining medicine or seeing a doctor;
• Get necessary services or supplies for themselves or their family or household members, such as getting food and supplies, pet food and supplies necessary for staying at home;
• Care for a family member in another household; and
• Care for older adults, minors, dependents, people with disabilities or other vulnerable persons.
Click here to read Wisconsin’s Emergency Order #12 “Safer at Home”. The order contains detailed information about the exemptions provided to certain businesses. If a business is unsure about whether or not they are exempted from this order, contact the Wisconsin Economic Development Corporation here.
Update: DATCP is taking swift action to begin addressing complaints against Wisconsin businesses accused of price gouging. Click here to learn about the cease and desist orders that they have sent to 16 companies so far that are suspected of violations to Order #72.
USA.GOV – For answers to other questions, find a complete list of government agency resources related to COVID-19, including Health and Human Service updates and a link to the Federal Trade Commission’s website tracking scams related to the virus.
UW-Madison Prevention Research Center – If you are currently pregnant or a new parent, you may be concerned about the COVID-19 pandemic and how it affects you and your family. Read about the current recommendations related to the virus and pregnancy, breastfeeding, and postpartum.
Investing: Surviving a Volatile Stock Market – This University of Minnesota fact sheet suggests steps to consider if you have retirement or other investments in the stock market. The most important step is to not panic or make quick decisions.
Advanced Directive for Health Decisions – this is also known as a Healthcare Directive and tells doctors and family about what medical treatment you want if you are so sick you cannot make decisions anymore. A Durable Power of Attorney for Healthcare, also known as a Healthcare Proxy, appoints a person to make health care decisions for you. Unlike many states, Wisconsin is not a “next of kin” or “family consent” state for adults. That means Wisconsin law does not let family members make decisions for incapacitated adult family members. As a general rule, spouses cannot make decisions for spouses, parents cannot make decisions for adult children, adult children cannot makes decisions for parents, with some exceptions for hospice and emergency care. Notarized signatures are not required on these forms, but you do need two witnesses when signing. Both forms are easy to fill out and can be downloaded from the Wisconsin Department of Health Services website.
Provide financial education to kids who are home from school – Click on this link to access Next Gen Personal Finance, where you’ll find lessons for all grade levels on topics like saving, budgeting, managing credit, and dealing with financial pitfalls.
Online security tips for working from home – Some US workers and many school children may be telecommuting — working from home — due to the pandemic. The Federal Trade Commission shares helpful cybersecurity tips and links for individuals and small businesses on their recent blog post.