Resources for Small Businesses to Access Capital

The CARES Act is comprehensive and far reaching. We went through the bill with our community and clients in mind, making note of the provisions that can help you the most in these trying times.

If you are a small business that has been negatively impacted by the COVID-19 outbreak, there are some new and expanded SBA provisions that may provide your business with immediate access to capital.

Payroll Protection Program –

This is new kind of SBA loan that may be forgiven without any tax consequences. If used properly, this is tax-free money from the government. To qualify, you must be an eligible small business that was in operation before February 15, 2020 and had salaried employees or paid independent contractors or self-employed individuals. The maximum loan employers can receive is 2.5x their average monthly payroll costs incurred during the prior year. All or a portion of this loan may be forgiven if certain payroll and employee retention metrics are hit.

Banks and lenders are rushing to get up to speed on this provision. US Bank already has information on their website on how to apply and we expect other large players to quickly follow suit.

The following link from the US Chamber of Commerce lays out the qualifications and eligibility requirements for obtaining a loan: US Chamber of Commerce

Another good link on the Payroll Protection Program: Rubio.Senate.Gov

Economic Injury Disaster Loan –

This provision expands on traditional SBA disaster loans by allowing small business owners to apply for an Economic Injury Disaster Loan advance of up to $10,000, with the total loan capped at $2,000,000. The loans are meant to provide economic support to help small businesses overcome a temporary loss of revenue.

Applications are being accepted online by the SBA here: SBA Loan Application

Forbes also has a good article detailing who is eligible and some of the other requirements of getting a loan: Forbes