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Months later and the Coronavirus pandemic is still ravaging on. This is not just a public health crisis, but an economic one as well and businesses—small and large alike—require financial assistance. With a growing demand for aid, more resources have been established, replenished, and made available to businesses in need.
We've spent some time breaking down everything you need to know about federal COVID-19 resources and how they can help your business stay afloat through the COVID-19 pandemic.
The SBA's Debt Relief program is one of many financial reprieves geared at assisting small businesses during the COVID-19 pandemic.
Businesses don't need to apply for this loan. Rather, the SBS will pay "6 months of principal, interest, and any associated fees" that a business currently owes on a loan. The relief will be applied automatically, though it does not work in tandem with a PPP loan or an Economic Injury Disaster Loan.
Business owners who owe for 7(a), 504 and Micro loans in regular serving status are eligible for the SBA Debt Relief program.
In addition, those who owe for 7(a), 504 and Micro loans dispersed prior to September 27, 2020 are also eligible.
There is no application for this relief program. Businesses who owe on the aforementioned loans will automatically benefit from this fund.
The U.S. Small Business Administration’s EIDLs provide the necessary working capital to help small businesses and nonprofits survive until normal operations are able to resume after a disaster ends. While this loan has been around for some time, this financial tool is readily available for business owners. Qualifying businesses are eligible for 3.75 percent low interest loans.
The EIDL also offered up to a $10,000 grant that did not need to be repaid. As of July 13, the funding for the advance grant has run out. However, it is possible that it may be revived, so please check the EIDL site for the most-up-to-date information.
Like many other SBA programs, the EIDL is for businesses with fewer than 500 employees. And good news - Independent contractors and sole proprietors can also apply for this one.
Business owners can apply for both the EIDL loan and the PPP loan, as long both loans are not used for the same expenses.
The application deadline is December 31, 2020.
Please refer to the U.S. Chamber of Commerce’s EIDL Guide for more information.
The pilot program enables small businesses who already have an existing business relationship with an SBA Express Lender to access an expedited emergency loan of up to $25,000 for disaster-related purposes. The program allows Small Business Administration Express Lenders' authority to deliver expedited SBA-guaranteed financing. Eligible businesses are expected to receive funding within 45 days of approval.
Small business are eligible for the EBL loans under the COVID-19 Emergency Declaration if they are located in any state, territory and the District of Columbia that have been adversely impacted by the COVID- 19 emergency.
The application deadline is March 13, 2021.
Please refer to the program guide for more information.
The Employee Retention Tax Credit is another Small Business Administration Program that is part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The new employee retention tax credit is a 50 percent tax credit for the first $10,000 of compensation, including the employer portion of health benefits, for each eligible employee.
The program is available to employers who are closed, partially closed, or experiencing significant revenue losses as a result of COVID-19. Private employers, including non-profits, that have experienced a decline in gross receipts by more than 50 percent in a quarter compared to the same quarter in 2019 can receive the employee retention tax credit.
Note that businesses that receive a Paycheck Protection Program (PPP) loan are not eligible for the tax credit.
The application deadline is January 1, 2021.
The Department of Labor’s FFCRA requires certain employers to provide their employees with paid sick leave or expanded family and medical leave for specified reasons related to COVID-19.
The Act expands paid leave benefits in two ways: emergency paid sick leave (COVID -PSL) and extended family medical leave (EFMLA) and provides employers with tax breaks designed to offset the costs of providing paid leave.
The Act provides that employees of covered employers are eligible for the following:
Any covered employee that has been employed for at least 30 days and requires sick leave or expanded family and medical leave for specified reasons related to COVID-19.
Employers with 500 employees or fewer are eligible for this small business exemption however, businesses with fewer than 50 employees can be exempted under certain circumstances that jeopardize the success of their business.
These provisions will apply from the effective date through December 31, 2020.
Federal Resources For Businesses of All Sizes
The Main Street Loan Program is a resource administered by the Federal Reserve Bank of Boston. The program is designed to help credit flow to small and medium-sized businesses that were in sound financial condition before the onset of the COVID-19 crisis, but now need loans to help maintain their operations until they have recovered from, or adapted to, the impacts of the pandemic.
Loans originated under the program have a variety of features that aim to help businesses endure the economic challenges posed by COVID-19. The program offers 5-year loans, with floating rates, and principal and interest payments deferred to assist businesses facing temporary cash flow interruptions.
The loans range in size from $250,000 to $300 million to support a broad set of employers. Businesses should apply through their current lender.
Businesses with 15,000 employees or less, or with revenue of $5 billion or less and are experiencing financial hardship as a result of COVID-19 are qualified to apply.
Businesses are still eligible to apply if they have laid off or furloughed workers due to COVID-19.
You can learn more about the Main Street Loan Program and its requirements here.
The Treasury Department and the Internal Revenue Service (IRS) launched the Employee Retention Credit, designed to encourage businesses to keep employees on their payroll. The refundable tax credit is 50 percent of up to $10,000 in wages paid by an eligible employer whose business has been financially impacted by COVID-19.
Qualifying employers must fall into one of two categories:
Note: As more resources become available, we will continue to add and update this section to provide the most accurate and up-to-date information.
The application deadline is January 1, 2021.
Running a small business under 'normal' circumstances is difficult enough. During a pandemic, it's even harder. Every situation is unique. We hope these resources are helpful as you navigate these uncertain times.
This post was originally published on August 04, 2020. This post was last updated on October 20, 2020.