CATA News

Following the massive $2.2 trillion CARES Act to provide direct cash payments to Americans and expand unemployment, signed March 27, Congress already is eyeing a "phase four" legislative package to respond to the coronavirus pandemic amid continuing signs of economic devastation and widespread job loss.
 
House Speaker Nancy Pelosi said March 30 that members of the House could do committee work remotely to have legislation ready to approve when congressmen return from recess in late April.
 
The first three phases passed in lightning speed — especially for Washington, D.C. — in March. A recap:
 
Phase 1
Targeted at slowing the spread of the virus, Phase 1 allocates a significant portion of the funds to the Department of Health and Human Services for vaccination research, CDC emergency funding, medical equipment, and grants for state, local, and tribal public health agencies and organizations. In addition, the bill provides $20 million to the Small Business Administration disaster loans programs to support the SBA’s administration of loan subsidies that will be made available to affected small businesses.
 
Phase 2
The bill’s main feature is federally mandated paid leave available for certain employees. Employers with less than 500 employees are required to provide two weeks of paid sick leave to any employee unable to work due to quarantine, isolation, coronavirus symptoms, or who are caring for someone in quarantine or isolation, or who has a child in schools that have been closed. Tax credits will be provided to the employer to offset these costs. Employees are further protected under the bill as they cannot be required to find replacements or use other paid time off. Also provides paid sick leave, free coronavirus testing, expanded unemployment benefits, and food insecurity measures.
 
Phase 3
The CARES Act (Coronavirus Aid, Relief, and Economic Security) carries a number of provisions. Among them:
• Allocates $500 billion for assistance to businesses, states, and municipalities, with no more than $25 billion designated for passenger air carriers, $4 billion for air cargo carriers, and $17 billion for businesses critical to maintaining national security
• Creates a $349 billion loan program for small businesses
• Provides $1,200 to Americans making $75,000 or less ($150,000 in the case of joint returns and $112,500 for head of household) and $500 for each child
• Expands eligibility for unemployment insurance and provides people with an additional $600 per week on top of the unemployment amount determined by each state
• Expands tele-health services in Medicare
• Provides the Secretary of the Treasury with the authority to make loans or loan guarantees to states, municipalities, and eligible businesses

 

"There’s so many things we didn’t get in any of these bills yet in the way that we need to," Pelosi said after Phase 3 was passed.

 

It is believed that one or more of the OEMs might have recently changed a stair-step dealer cash program to straight dealer cash. If that is accurate, the amounts paid to the dealer would become taxable by the state of Illinois.

Basically, dealer incentives are taxable unless they are contingent at the time of sale on making or having additional retail sales (common stair-step programs), or contingent on some other qualifier, such as the dealer meeting certain manufacturer required marketing standards, facility standards, or sales and service department goals (CSI).
  
Illinois dealers must report taxable dealer incentives on Section 6, Line 1 of Form ST-556 as part of the sale of the vehicle reported on that return, one of several Illinois Revenue Department changes that took effect July 1, 2008.
• The changed regulations depict six distinct types of transactions; only No. 1 is taxable:

1. Taxable incentive payments [payment conditioned on the retail sale]: An automobile manufacturer offers a dealer incentive (sometimes referred to as "dealer cash") of $1,000 for each of a specific type of vehicle sold to a retail customer during March. A dealer sells that type of a vehicle to a retail customer for $38,000 during March. The retail sale of that vehicle qualifies the dealer for the manufacturer’s dealer incentive payment of $1,000. The purchaser pays the dealer $38,000 and the dealer receives $1,000 from the manufacturer. Since the $1,000 payment is conditioned only upon the sale of that vehicle and is not conditioned upon the sale of any other vehicle or vehicles, the taxable gross receipts received by the dealer for this sale are $39,000.

2. Nontaxable incentive payments [payment conditioned on the retail sale, but only after a certain number of sales have been made]: A manufacturer offers a dealer incentive payment (sometimes referred to as "dealer cash") of $1,000 for each of a specific type of automobile sold to a retail customer in March, but only if the dealer sells at least 15 of those types of vehicles during that month. A dealer sells that type of a vehicle to retail customer for $38,000 on March 25. The dealer had sold 14 of those types of cars earlier that month, and the March 25 sale qualified the dealer for the $1,000 manufacturer payment on that sale and each of the 14 previous sales. The gross receipts from the March 25 sale are $38,000 and the $1,000 manufacturer’s payment is not part of the dealer’s gross receipts from that sale. In addition, the $14,000 payment to the dealer for the sales of the previous 14 vehicles were contingent upon the sale of other vehicles and are not part of the gross receipts from the sales of those vehicles. If the dealer sold a vehicle on March 26 and qualified for another $1,000 manufacturer payment for that sale, the $1,000 manufacturer payment would not be part of the dealer’s gross receipts from that sale.

3. Non-taxable dealer hold-backs [payment not conditioned on the retail sale]: A manufacturer provides dealer hold-back payments to its automobile dealers of 3 percent of the invoice price of each vehicle purchased from that manufacturer. The dealer hold-back payments are paid to the dealer on a quarterly basis regardless of whether that dealer has sold at retail one or more of the vehicles it had purchased that quarter. The dealer purchases a vehicle from the manufacturer at the beginning of the month for an invoice price of $39,000 and then sells that car 10 days later at retail for $40,000. The manufacturer of that vehicle pays an amount to the dealer of $1,170 (3 percent of the invoice price of $39,000) at the end of the quarter as a dealer hold-back for that vehicle. Since the $1,170 hold-back payment to the dealer from the manufacturer is conditioned only on the purchase of the vehicle from the manufacturer (not on the subsequent retail sale of the vehicle), the taxable gross receipts received by the dealer for this sale are only $40,000.

4. Non-taxable [payment not conditioned on the retail sale]: A dealer normally offers a specific type of vehicle for retail sale for $40,000. The manufacturer agreed to pay an incentive to the dealer of $3,000 for each of those types of vehicles that the dealer purchased for resale from the manufacturer during a specified promotional period. After purchasing the vehicle during the qualifying period, the dealer offered the vehicle for sale at a reduced or discounted price of $37,000. A retail purchaser agrees to purchase the vehicle for $37,000. Since the $3,000 incentive provided to the dealer from the manufacturer is conditioned only on the dealer’s purchase of the vehicle from the manufacturer (not on the subsequent retail sale of the vehicle), the taxable gross receipts received by the dealer for this sale are $37,000.

5. Non-taxable performance bonus payments: A manufacturer establishes a performance bonus program for dealers who obtain a certain customer service index (CSI) score that demonstrates a substantial degree of satisfaction from their sales and service customers. Upon meeting such requirement, the automobile dealer will receive an incentive payment from the manufacturer calculated as 2 percent of the MSRP of the vehicles sold by that dealer during the incentive period. Because the bonus is contingent on the dealer meeting certain customer satisfaction goals as indicated by the CSI score, the manufacturer’s performance bonus would not be part of the gross receipts received by that dealer for the sales of those vehicles.

6. Non-taxable marketing or facility incentive payments: A manufacturer creates an incentive program for dealers who meet certain marketing standards or facility standards designed to increase sales and brand loyalty. Upon meeting such standards, the dealer will receive an incentive payment from the manufacturer calculated as a flat amount of $500 per vehicle sold by the dealer during the incentive period. Because the incentive is contingent on the dealer meeting certain marketing or facility standards set by the manufacturer, the $500 incentive payments would not be part of the gross receipts received by that dealer for the sales of those vehicles.

 

By Judy Mason, CPA, CVA, MichaelSilver
 
President Trump signed into law the CARES Act — worth more than $2.2 trillion — on March 27 to help stimulate the economy reeling from the effects of the coronavirus.

 

What are the aspects of the CARES Act that can help my business (and my employees)?
Loans and payroll credits along with unemployment benefits, including the Paycheck Protection Program loans (PPP), emergency Economic Injury Disaster Loans (EIDL), refundable payroll tax credits, deferment for some payroll tax payments, and enhanced unemployment benefits.

 

Which loan is best for my business, an EIDL or PPP loan?
EIDLs provide a $10,000 cash advance within three days of applying for the loan. The $10,000 cash advance does not need to be repaid if the loan is subsequently denied. EIDLs are capped at $2 million. PPP loans are capped at $10 million and provide an opportunity for a portion of the loans to be forgiven. The forgiveness or cancellation of the loans would not be treated as income for tax purposes. If cash flow is not an immediate concern, the PPP loan may be the better option.

 

Should I use my other sources of business funding before applying for these loans?
A key factor to consider when deciding whether or not to apply for these loans is the potential forgiveness factor of the PPP loan. However, applying for a line of credit to help in the short run doesn’t preclude you from applying for a PPP loan.

 

Is my business eligible for the PPP loans? What are the affiliation rules?
Businesses with 500 or fewer employees are eligible. To determine the 500 limit, affiliation does not apply to a business operating a franchise that is assigned a franchise identifier code by the SBA. OEM brands with franchise identifier codes including Chrysler, Dodge, Jeep, Ram; Kia; Ford, Lincoln; Mazda; Mitsubishi; Subaru; and Volvo. Many other OEM’s have applied to the SBA for a franchise identifier code. Once obtained, the franchisee may also be exempt from the affiliation rules. The NADA is encouraging the SBA to expedite this process.

 

How much of a loan can I receive for each one of my dealerships?
The maximum loan amount is limited to 2.5 times the average monthly payroll costs for the last 12 months, with compensation of each employee limited to $100,000. Payroll costs include salary, wages and commissions, tips, paid leave, healthcare, and retirement payments. The payroll costs are reduced for any qualified sick leave or family leave wages for which a credit was allowed under the Families First Coronavirus Response Act. The maximum loan amount is $10 million.

 

What are the allowable uses of the loan proceeds?
• Salaries and commissions
• Costs related to the continuation of group health insurance and other benefits
• Mortgage interest payments
• Rent subject to a lease
• Utilities
• Interest on debt obligations incurred before the covered period

 

How much of the loan will be forgiven?
Total payroll costs, rent, utilities, and mortgage interest paid during the eight-week covered period. This amount is reduced if the number of employees declines during the covered period as compared to the number of employees for the period Feb. 15-June 30, 2019 or Jan. 1-Feb. 29, 2020, whichever is lower. Reductions in employment or wages that occur during the period beginning Feb. 15, 2020 and ending 30 days after enactment of the CARES Act, (as compared to Feb. 15, 2020) will not reduce the amount of loan forgiveness IF the borrower eliminates the reduction in employees or reduction in wages by June 30, 2020.

 

What if I continue to reduce my workforce? Does that reduce how much will be forgiven?
Yes, the amount of loan forgiveness is reduced if there is a reduction in the number of employees or a reduction of greater than 25% in wages paid to employees.

 

What happens after the forgiveness period?
Any loan amount not forgiven at the end of one year is carried forward as a loan with a maximum term of two years. Principal and interest will be deferred for a total of six months to one year after disbursement of the loan.

 

What are the loan terms and interest rates?
The maximum term is two years and maximum interest rate is 0.5% as of April 1, 2020.

 

Will I be required to personally guarantee the loan?
No personal guarantee or collateral is required. A "good faith certification" is required to verify the forgiveness portion of the loan.

 

Who should I contact if I would like to apply for a loan?
Most of the banks will be handling the application and processing of the PPP loans through the SBA. EIDLs can be applied for directly from the SBA website.

 

How should I account for these loans and track the expenses?
Document the amount eligible for forgiveness. Support includes the following:
• Verification of the number of employees and payroll paid using payroll tax returns
• Documentation of other eligible costs such as group health care benefits, including insurance premiums, payments of interest on mortgage loans, rent, utilities, and interest on debt incurred before the covered period
• Certification by a representative of the business

Consider a separate bank account to track the appropriate use of funds for specific costs during a specific period.

Should I consider taking these loans or should I use the payroll tax credits instead?
There is a payroll tax credit available if you choose not to apply for a loan. The details are provided below. There also is an option to defer the payment of a portion of the employer payroll taxes.

• Employee retention credit in the form of a refundable payroll tax credit:
  o Eligible employers include any business that is required to partially or fully suspend operations due to COVID-19
  o Businesses whose gross receipts are 50% or less this quarter compared to the same quarter in the previous year
  o The credit is computed at 50% of wages up to $10,000 of wages per employee for eligible employers ($5,000 credit).
  o Wages of employees who are furloughed or face reduced hours are eligible for the credit
• Delayed payment of certain employer payroll taxes (6.2% OASDI) through the end of 2020
  o The deferred tax liability would be paid in two installments – half by Dec. 31, 2021 and the remaining half by Dec. 31, 2022

 

Can I take the credits and payroll tax deferral if I have a PPP loan?
No. If you receive PPP loan proceeds, you are not eligible for the credit and tax deferral payments. More than likely, the PPP loan is a better option unless your workforce is significantly decreased during the next several months.

 

What are my options if I do not qualify for the PPP loan?
Small businesses with less than 500 employees may request an advance of $10,000 through an EIDL to be used for providing sick leave, maintaining payroll to retain employees, meeting increased material costs, making rent or mortgage payments, and repaying obligations that cannot be met due to revenue losses.

 

If I have to lay off employees, what kind of unemployment benefits would they receive?
• Recipients are eligible for an additional $600 per week payment through the end of July in addition to their state unemployment benefits.
• The unemployment benefits created under the CARES Act terminate at the end of 2020.

 

What is the Families First Coronavirus Response Act?
Congress also passed the Families First Coronavirus Response Act (FFCRA). This act went into effect April 1, 2020 and mandates employers with less than 500 employees to provide paid sick pay and family leave for employees who are affected by the virus. The NADA issued a FAQ document that can answer many questions about how the various credits work under this Act.

If I have any questions about the CARES Act and FFCRA, who should I contact?
You should discuss all of these options with your professional advisors including your banker, your employment attorney, and your CPA. We at MichaelSilver also are available to answer any additional questions that you might have.

 

The federal government’s Paycheck Protection Program on April 3 began accepting applications for loans to small businesses and sole proprietorships affected by the coronavirus pandemic.
 
The application can be found on the U.S. Treasury’s website, along with details for borrowers and for lenders. Treasury representatives urged those in need of funding to apply quickly, noting that the program has a cap and demand is likely to be high.
 
The $349 billion program was enacted as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, signed by President Trump on March 27. Under the program, small businesses with 500 or fewer employees including not-for-profits, veterans’ organizations, tribal concerns, self-employed individuals, sole proprietorships, and independent contractors are eligible for loans to pay up to eight weeks of payroll costs including benefits as well as other costs. Businesses with more than 500 employees are eligible in certain industries, Treasury said.
 
Loan forgiveness is based on the employer’s maintaining or quickly rehiring employees and maintaining salary levels, Treasury said in its overview documents. Forgiveness will be reduced if full-time headcount declines or if salaries and wages decrease.
 
PPP funds also can be used to pay interest on mortgages, rent, and utilities. Treasury noted that due to likely high demand for the program, at least 75% of the forgiven loan amount must have been used for payroll.
 
Loan payments will be deferred for six months. No collateral or personal guarantees are required. Neither the government nor lenders will charge small businesses any fees.

 

An employer who receives a loan under the PPP is not eligible to also claim an employee retention credit under the CARES Act. The employee retention credit gives eligible employers whose business operations are fully or partially suspended due to the COVID-19 pandemic a credit against employment taxes equal to 50% of qualified wages (up to $10,000 in wages) for each employee.

 

 The Chicago Automobile Trade Association on March 30 surveyed its dealer members to get a sense of their operations during this pandemic, so that the CATA can help them make the most informed decisions for their businesses.
 
The seven-question survey sought information about a dealership’s business hours, whether sales departments were operating, and how service volume compared to January 2020. About 100 survey respondents representing more than 120 area new-car dealerships said the following:

1. Please report the current state of your business
• Completely shut down: 9.4%
• Maintaining service operations and sales by appointment: 89.4%
• Maintaining service operations only; sales closed: 1.1%

 

2. Please provide your active employee headcount (approximate) in these areas of your store over the past 60 days.
• Service staffing down 44% (47% if closed dealerships are counted)
• Sales staffing down 45% (49% if closed dealerships are counted)

 

3. Are your technicians unionized? (represented by Mechanics’ Local 701)
• Yes: 48%
• No: 52%

 

4. Are your parts employees and porters unionized? (represented by Teamsters Local 731)
• Yes: 29%
• No: 71%

 

5. Sales Volume today as compared to 1/31/20
• 10% of volume: 24% of respondents
• 25% of volume: 24% of respondents
• 50% of volume: 39% of respondents
• 75% of volume: 11% of respondents
• 100% of volume: 2% of respondents

 

6. Service volume today compared to 1/31/20
• 10% of volume: 11% of respondents
• 25% of volume: 22% of respondents
• 50% of volume: 40% of respondents
• 75% of volume: 23% of respondents
• 100% of volume: 4% of respondents

 

7. Does your dealership intend to pursue a business loan (and potential loan forgiveness) under the CARES Act?
• Yes: 90%
• No: 10%

 

Hawk Volkswagen of Joliet, Bill Jacobs Volkswagen (Naperville), Jennings Volkswagen (Glenview), and Muller Volkswagen (Highland Park) were named members of Volkswagen’s 2019 Wolfsburg Crest Club, for extraordinary sales and customer experience efforts.

Here’s some encouraging news amid all of the economic turmoil caused by COVID-19. The auto segment of the S&P/Experian Consumer Credit Default Indices showed a significant decline in February.
 
Dow Jones Indices and Experian on March 17 released their data through February and reported that auto defaults dropped 10 basis points on a sequential basis to land at 0.89%. That’s the lowest reading since last July when it also stood at 0.89% after two straight months when analysts pegged the metric at 0.87%.
 
For some perspective in light of the coronavirus impact, data from Dow Jones Indices and Experian indicated the reading in January 2010 was 2.57% when the industry still was recovering from the Great Recession.
 
Returning to the February data, Dow Jones Indices and Experian indicate the composite rate — a comprehensive measure of changes in consumer credit defaults — remained unchanged at 1.02%.
 
Analysts also found the first mortgage default rate also stayed unchanged in February, holding at 0.84%. Going counter to the auto sector, Dow Jones Indices and Experian noticed the bank card default rate increased 13 basis points to 3.41%.
 
Among the five major metropolitan areas analysts track for the monthly update, analysts pointed out that four cities posted lower default rates in February compared to the previous month.
 
Miami generated the largest decrease, dropping 11 basis points to 1.66%. New York fell 7 basis points to 1.00%, while Los Angeles dropped 6 basis points to 0.80%. Dallas dipped 5 basis points to settle at 1.02%.
 
Chicago was the only major metropolitan area that increased in February, rising 4 basis points to 1.21%.
 
Jointly developed by S&P Indices and Experian, analysts noted the S&P/Experian Consumer Credit Default Indices are published monthly with the intent to accurately track the default experience of consumer balances in four key loan categories: auto, bankcard, first mortgage lien and second mortgage lien.

 

The indices are calculated based on data extracted from Experian’s consumer credit database. This database is populated with individual consumer loan and payment data submitted by lenders to Experian every month.

 

Experian’s base of data contributors includes leading banks and mortgage companies and covers approximately $11 trillion in outstanding loans sourced from 11,500 lenders.

 

The coronavirus that is disrupting personal and professional affairs across the globe can count another victim: the Illinois General Assembly.
 
No hearings are scheduled in either the state Senate or House of Representatives through May 31, when the bodies ordinarily adjourn their spring sessions.
 
Senate Bill 2481 has enjoyed unanimous support in two roll-call votes. A third affirmative vote would send the bill to the state House. Gov. JB Pritzker has voiced his backing.
 
The cap took effect Jan. 1 following moves last spring to find funding for the $45 billion state capital infrastructure plan sought by Pritzker. Under the bill, infrastructure projects would instead be funded, in part, by increasing the sales tax charged in private vehicle sales, based on vehicle age and selling price.

 

In other news from Springfield, under proposed state legislation, drivers could obtain a registration permit from the Illinois Secretary of State that is valid for 90 days instead of the current term of 30 days. The longer-lasting permit would carry a $13 fee.
 
But the future of Senate Bill 3197 is in question, with state lawmakers recessed during the current pandemic outbreak. The General Assembly’s 2020 schedule called for bills becoming law to pass out of committee by March 27. An adjusted schedule has not been announced.

 

The coronavirus that is disrupting personal and professional affairs across the globe can count another victim: the Illinois General Assembly.
 
No hearings are scheduled in either the state Senate or House of Representatives through May 31, when the bodies ordinarily adjourn their spring sessions.
 
Senate Bill 2481 has enjoyed unanimous support in two roll-call votes. A third affirmative vote would send the bill to the state House. Gov. JB Pritzker has voiced his backing.
 
The cap took effect Jan. 1 following moves last spring to find funding for the $45 billion state capital infrastructure plan sought by Pritzker. Under the bill, infrastructure projects would instead be funded, in part, by increasing the sales tax charged in private vehicle sales, based on vehicle age and selling price.

 

In other news from Springfield, under proposed state legislation, drivers could obtain a registration permit from the Illinois Secretary of State that is valid for 90 days instead of the current term of 30 days. The longer-lasting permit would carry a $13 fee.
 
But the future of Senate Bill 3197 is in doubt, with state lawmakers recessed during the current pandemic outbreak. According to the General Assembly’s 2020 schedule, bills in hope of becoming law must pass out of committee by March 27. SB 3197 currently is before the Senate Transportation Committee.

 

Everyone should be concerned about contracting the new coronavirus — if not for oneself, then to protect others who are at risk of becoming severely ill. As with the flu, the virus is more dangerous for people who are older than 60, people who have a weakened immune system, and people with an underlying condition such as diabetes, asthma or another chronic illness.
 
The flu and the coronavirus can cause similar symptoms — a whole-body malaise, with a fever, a dry cough and a noticeable shortness of breath — but there are differences. Because the symptoms are so similar, doctors will sometimes rule out the flu first.
 
Spring allergy season tends to trigger many of the same symptoms in many people, adding another diagnostic wrinkle.

With the spread of the coronavirus comes another ailment: anxiety about every single symptom. Is an itchy nose the result of trying not to touch one’s face or is it the onset of the flu? Or is it, just maybe, the coronavirus?
 
As spring nears, allergies may be triggering symptoms that can make it difficult to determine what your body is trying to fight off. Dr. Amesh Adalja, an infectious disease specialist at the Johns Hopkins Center for Health Security, helps explain the subtle differences between signs of allergies or infection with the flu or the coronavirus.
 
First, consider the time of year. Allergies and influenza tend to be seasonal. If you have a runny nose in the spring and this happens every year, allergies are the likeliest culprit. If it’s winter and flu is raging in your community, then that’s the probable explanation. The flu is far more widespread than the coronavirus.
 
But flulike symptoms in warming weather — in a place with documented coronavirus transmission? Maybe it’s not the flu.

Influenza dies back in the summer, but scientists have yet to see evidence that the coronavirus will go away as temperatures rise. Coronavirus infections have been spreading in equatorial climates like Singapore’s and in the Southern Hemisphere, now in the middle of summer.

 

Consider, too, where the symptoms first started appearing. "It’s usually your nose and eyes where you develop symptoms of seasonal allergies," Dr. Adalja said.

 

The seasonal flu, on the other hand, is more likely to affect your whole body, as is the case for many other respiratory viruses — including the coronavirus. So if you experience fevers, headaches or muscle aches, consider flu or coronavirus.

 

"There’s a feeling of overall malaise that is associated with viral infections," Dr. Adalja said. Except for seasonality, it can be hard to tell the two apart.

 

"Unfortunately, there’s no reliable way to distinguish between early symptoms of the flu and coronavirus," Dr. Adalja said. "The only way to distinguish the two clinically is with a diagnostic test."

 

According to reports from nearly 56,000 laboratory-confirmed cases in China, people infected with the coronavirus develop symptoms like a dry cough, shortness of breath and a sore throat, in addition to fever and aches.

 

About 5 percent of patients may also experience nausea or vomiting, while roughly 4 percent develop diarrhea. Researchers are not sure why some people develop gastrointestinal symptoms with coronavirus infections.

 

"But that’s not something you usually see with influenza in adults," Dr. Adalja said.

 

Severe coronavirus infections can result in lung lesions and pneumonia. But the vast majority of those infected get only mild cases that often resemble the flu.

 

Your personal history can give doctors clues to what’s going on. If you traveled to an area with large clusters of coronavirus cases, or were in contact with someone who later tested positive for the virus, you may have caught it, too.

 

Doctors and health care workers have to work with these possibilities because tests are still available only in limited quantities in the United States, Dr. Adalja said.

 

How bad is it?

Pay close attention to whether your symptoms worsen over time. Discomfort due to allergy remains consistent until you treat it or the allergen goes away. Symptoms of the flu tend to resolve in about a week.

 

The new coronavirus, on the other hand, seems to cause more severe symptoms than the average seasonal flu and seems to have a higher fatality rate, although the numbers are a bit uncertain.

 

If you are elderly or have other health conditions, such as heart disease, Type 2 diabetes or immunodeficiency, you are more vulnerable to viral infections and are more likely to develop severe disease if infected with the coronavirus.

Early estimates from China show that the average death rate among coronavirus patients is about 2 percent, but that figure rises to 8 percent in people 70 years or older, and about 15 percent in people 80 years or older.

But nobody is certain how many cases are very mild or asymptomatic.

 

What to expect
The general advice for people who get sick with the flu or coronavirus is very similar: Rest and drink plenty of fluids.

Mild cases of the flu resolve by themselves within a few days. Although coronavirus infections tend to last a little longer, most people with mild cases get better in about two weeks, Dr. Adalja said.

 

Severe cases may take three to six weeks to resolve. Doctors can only give supportive care, providing patients with intravenous fluids, medicines to keep the fever down or oxygen to help with breathing.

 

There are no approved treatments for coronavirus infections, although a few clinical trials are underway that test antiviral drugs such as remdesivir.

 

It’s up to you to take precautions to prevent a coronavirus infection, and to take stock of your medical and travel history. But you don’t need to go to the doctor for every sniffle or scratchy throat.

 

"You should be going to the doctor for something that would trigger concern, even before you had heard of the coronavirus," Dr. Adalja said.

 

"So if you’re somebody that’s elderly or somebody that has another medical condition, if you develop shortness of breath, if you develop extreme fatigue, those are real indicators to call your physician and go to the hospital."