SBA Loans/Grants

Congress just approved $350 billion in emergency loans for small businesses — and borrowers who maintain or restore their payrolls won’t have to pay back the loans.

The Paycheck Protection Program is part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. This is a nearly $350-billion program intended to provide American small businesses with eight weeks of cash-flow assistance through 100 percent federally guaranteed loans.  For Business Guide and Checklist, click HERE. 
Program highlights

  • All small businesses are eligible
  • The loan has a maturity rate of 2 years and an interest rate of 0.5%
  • No need to make loan payments for the first six months
  • No collateral or personal guarantees required
  • No fees
  • The loan covers expenses dating back to February 15, to June 30 2020
  • The loan can be forgiven and essentially turn into a non-taxable grant
This program is more extensive than the SBA Economic Injury Disaster Loan. Small businesses, sole proprietorships, independent contractors, and self-employed individuals can all qualify.
  • Sole proprietorships will need to submit schedules from their tax return filed (or to be filed) showing income and expenses from the sole proprietorship.
  • Independent contractors will need to submit Form 1099-MISC.
  • Self-employed individuals will need to submit payroll tax filings reported to the Internal Revenue Service.
To learn more about the Paycheck Protection Program and how to apply, click HERE.
The Economic Injury Disaster Loan (EIDL)-oftened shortened to just SBA disaster loan. This is a separate, but similar, initiative. Here’s how they differ:
  • No personal or business collateral is required. The SBA disaster loan may require collateral for loan amounts over $25,000.
  • It’s ok if you also have access to credit elsewhere. To receive a SBA disaster loan you generally need to have no other source of credit.
  • The funding covers a more restrictive set of purposes (details below). The SBA disaster loan can cover most operating expenses.
To learn more about EIDL or to apply, click HERE.

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