Many Americans have been greatly impacted by COVID-19 and its effects. Thankfully, the government has created the Coronavirus Aid, Relief, and Economic Security or CARES Act. This Act went into effect in late March of 2020 and offers funds and other relief options to many eligible individuals, government entities, and businesses suffering as a result of Coronavirus.
If you, early on, made the smart decision to apply for any and all CARES funds for which you are eligible, then you are already adept at meeting deadlines. Initial applications for relief, as well as related paperwork, all had stringent deadlines that had to be met in order to secure funding.
If you’ve made it through that step successfully, don’t lose out on your funds now! Remember, that there is still one major deadline looming: December 30, 2020. This is the deadline by which all local governments that took advantage of CARES funds are required to have spent or allocated those funds appropriately.
Under the CARES Act, some qualifying distributions can be made from an IRA or QP. However, bear in mind that the December 30 deadline applies to these distributions as well. So, if this was your plan for your funds, but you haven’t yet taken steps in that direction, now is the time to act. However, it may prove too late for this option, in which case you may want to look for other smart ways to spend your money.
Outside of qualifying distributions, many governments have made the decision to use their CARES funds to upgrade their technology in order to better serve their constituents. By using their funds to make “digital investments,” many governments will be able to provide better, safer access to resources that benefit their communities. They can also hold meetings online, offer various services online, and perform other actions online which they could not before.
While a great many government entities have already made the wise decision to invest their funds in this manner, there are still several that are undecided on how best to allocate their funds. However, for those governments that are unsure, technological upgrades make the most sense. They can be done quickly, which is important with the deadline for utilizing CARES resources fast approaching. They can also provide both immediate benefits and long-term benefits to local governments. In fact, it is exactly that—their potential to benefit governments both during and long after the pandemic—that makes this investment choice one of the smartest uses of CARES funds.
Furthermore, providing that a few basic requirements for eligibility and proper use of funds are met, using the funds in this way is completely allowable and well within the bounds of the law and the Act itself
If you’re wondering whether or not you can use your CARES funds on technological investments, the main thing to consider is if the purchase is one that you can prove as “necessary” as a direct result of the pandemic.
If, for example, you use your funds to invest in technology that allows you to offer live assistance to others or that can make resources available more readily, that would be deemed a necessary and allowed use of your CARES funds.
With that said, keep in mind that you don’t have to prove that your purchase has proven necessary by the deadline. All you have to do, by the deadline, is to have spent the funds provided to you and to be able to demonstrate that they were necessary at the time of purchase, even if you actually start to use and enact the purchased resources at a later date. After all, digital investments often take time to set up and fully launch, a fact that the CARES Act understands and allows for.
Also, it’s perfectly fine to continue to use your technological investments well into the future. In fact, it’s a good thing if you do so and shows a smart use of the funds you were provided. While the money is intended to provide fast, pandemic-related relief, there is certainly nothing wrong with choosing a use of your funds that will have long-term benefits.
If you do ultimately choose to spend your CARES funds on technological upgrades, make sure you choose the right ones so that you can invest your money in the most beneficial way possible, as well as in a way that is likely to be approved.
While all kinds of upgrades could potentially qualify as eligible, look specifically for technologies that allow you to do things like engaging in Clouds-based communications, applying for helpful grants or other aid, allowing for remote work, increasing governmental transparency, or enabling better and more accurate reporting.
Ultimately, how you use your CARES Act funds is up to you, but you do need to use them soon!
As such, if you’re struggling for a fast, effective, and wise way to use the money you’ve been granted, strongly consider investing in digital upgrades. They’re easy to validate as “necessary” and are likely to provide the most long-term benefit out of any other investment you could possibly find.