Federal SMB COVID-19 Loans and Grants

3 minute read

We have compiled a selection of the top resources for financial relief that are being offered by the Federal government.

Main Street Emergency Grant Program

Proposed by U.S. Senators Chris Murphy (D-Conn.), Jeff Merkley (D-Ore.) and Chris Van Hollen (D-Md.), would allow small businesses to apply and receive grants quickly through the Treasury Department.

The Main Street Emergency Grant Program would allow small businesses, including self-employed individuals, and nonprofits to rapidly apply for grants through the Treasury Department to cover fixed costs, including payroll, during the COVID-19 public health emergency. Grant amounts would be based on a percentage of expenses necessary for the survival of the business.

Businesses could spend the money on payroll or other fixed costs, such as rent, that are necessary to keep the business operating.

These grants would turn into loans that would have to be repaid if businesses failed to restore their payroll to 80% of prior levels within 12 months of the termination of the COVID-19 public health emergency, unless the business can demonstrate a hardship that prevented them from doing so.

The Main Street Emergency Grant Program also offers forgivable loans to midsize businesses who are experiencing similar losses. These loans would be forgivable if businesses restore their payrolls to 80% within 12 months of the termination of the COVID-19 public health emergency.

$2 trillion stimulus bill

Late Wednesday night, the Senate unanimously passed the largest economic stimulus package in American history.  The $2 trillion stimulus bill will include a $367 billion program aimed at helping small businesses continue to make payroll.

Paid Sick Leave & Unemployment Aid 

Congress passed the Families First Coronavirus Response Act Wednesday evening with the primary purpose of making sure people continue to get paid. It requires employers to provide paid leave for their employees and specifies the differences between how family leave and medical leave are treated. The leave will be reimbursed by the federal government and the legislation includes language that tells the Department of Labor to exempt small businesses with fewer than 50 employees from the paid leave mandates.

SBA Export Loans 

If your business works in international trade, the SBA offers export loans to help respond to challenges like coronavirus and opportunities associated with trade. These loans are applicable to U.S. small businesses that either export directly overseas or export indirectly by selling to direct-exporter customers.

The SBA offers three export loan programs:

  • Export Express, which gives access to capital up to $500,000.
  • Export Working Capital, which provides revolving lines of credit or transaction-based financing of up to $5 million.
  • International Trade, which helps retool or expand to better compete and react to changing business conditions. Contact the SBA for exact loan amounts.

You can learn more about each of these loans on its website.

 

US Chamber | Mentors to Help SMBs Apply for Disaster Assistance 

The US Chamber has compiled an article outlining the valuable resources that they are offering to help your small business survive the Coronavirus. This includes SCORE which is a program that offers advice and assistance from its business mentors to help SMBs navigate financial challenges and assistance in applying for SBA disaster assistance loans. SCORE has centralized all of its assistance options here.

 

Internal Revenue Service (IRS) | 90 Day Extension 

Small business owners and consumers will have an additional 90 days to pay taxes—until July 15, 2020. Though you still must file your tax return or extension by April 15.

Payment Protection Plan | $349 billion toward job retention

The Paycheck Protection Program established by the CARES Act, is implemented by the Small Business Administration with support from the Department of the Treasury.  This program provides small businesses with funds to pay up to 8 weeks of payroll costs including benefits. Funds can also be used to pay interest on mortgages, rent, and utilities.

The Paycheck Protection Program prioritizes millions of Americans employed by small businesses by authorizing up to $349 billion toward job retention and certain other expenses.

Small businesses and eligible nonprofit organizations, Veterans organizations, and Tribal businesses described in the Small Business Act, as well as individuals who are self-employed or are independent contractors, are eligible if they also meet program size standards.

Stay safe and remain strong in this turbulent time. And remember to check back on this article for updates as details of the above guidance and resources change.

 

If you have additions that you would like to see on our page please send them to reeves@yahoosmallbusiness.com.