The government has provided some additional financial relief during the pandemic in addition to some mortgage forbearances, and temporary foreclosure and eviction moratoriums (see my previous blogs here for information on that relief). This relief will help some people a little, though there should be a lot more of this.
- California and federal income taxes that would have been due April 15, 2020 are now due July 15, 2020. If you expect a refund, you should of course file your taxes as soon as possible, but if you owe taxes or have to pay estimated taxes and you are facing a financial hardship, you might as well wait until July 15 to file and pay income tax.
- There has been an expansion of unemployment benefits, both in amount and in expansion of people eligible who had not been previously, such as self-employed people including Uber & Lyft drivers. For more information on this, go to the Employment Development Department website here.
- PG&E has suspended shutoffs for now. This doesn’t mean that you don’t have to pay your utility bill, and you should pay it if you can afford to. PG&E is offering payment plans, but you will have to make up for any payments missed or for partial payments. If you have East Bay Community Energy, they do not shut off services, they would normally have PG&E do that but they are not referring shutoffs to PG&E for the time being. See the information for PG&E here, and East Bay Community Energy here.
- Student loan borrowers who received direct federal student loans — this includes all federal student loans beginning July 1, 2010 and covers approximately 85% of all federal student loans — have a deferral beginning March 13, 2020 and do not have to make student loan payments until October 2020. Interest on payments deferred that would normally be due will not be charged, so the only harm in not making payments is that your student loan payments will last longer depending on whether and how much you didn’t pay during this deferral. If you have an indirect federal student loan, you may apply for a deferral by contacting your servicer. If your federal student loan is older than July 1, 2010 and you don’t know whether it’s a direct or indirect loan, visit your servicer’s website. For more information about this deferral, see the Department of Education’s website here. As with all of this, if you can afford to make your student loan payments, you should do so. The interest during the deferral period is 0%, so the entire amount of your payments during this time will be applied to the principal balance.
This relief is better than nothing, but it’s not sufficient. It would be much better for the government to suspend collections of all payments for necessities, such as rent, mortgage, utilities, and water, while people are unable to earn money because of the pandemic. However, you should make use of any or all of these programs if you need financial help during this crisis.