On March 27th, 2020 the Coronavirus Aid, Relief & Economic Security (CARES) Act was signed into law, providing $2.2bn in emergency aid. More specifically, $349bn of these funds will provide critical relief to small businesses.
The CARES Act includes multiple small business loan programs: the Paycheck Protection Program (PPP), which includes a loan forgiveness provision, the Economic Injury Disaster Loan Assistance program (EIDL) which covers a broader range of business expenses and an expansion of the SBA 7(a) program. The CARES Act includes many other items that can help your small business with cash needs and adjustments to tax handling for 2019 and 2020: Employee Retention Credits, Payroll Tax Deferrals, Net Operating Loss carryback changes, increased Interest Deductions, and increased depreciation deductions on Qualified Improvement Property.
The two items with the greatest impact for many small businesses are the two loan programs: The Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL) assistance program, designed to allow businesses to continue making payroll and paying operating expenses in times of reduced cash flows and sales. Both loans are Federally backed through the Small Business Administration. The CARES Act allows businesses to be enrolled in only one loan program.
The Paycheck Protection Program (PPP) application are starting on Friday, April 3rd and you can find the application form on the SBA website.
To read more about which option would best be suited for your business, please follow the link provided below.
If you have any questions, please contact us.