Federal Resources

CARES Act Information

We will be updating this document periodically with additional resources related to navigating the CARES Act. For additional resources, please refer to our Small Business Resource Center: COVID-19 Crisis.

The Coronavirus Aid, Relief, and Economic Security (CARES) Act allocated $350 billion to provide relief for eligible small businesses amid the pandemic and economic downturn. Some key programs and initiatives of the Act include:

  • Paycheck Protection Program
  • Small Business Debt Relief Program
  • Economic Injury Disaster Loans and Emergency Economic Injury Grants
  • Small Business Contracting
  • Small Business Tax Provisions

Struggling to get started? The following questions might help point you in the right direction. Do you need:

  • Capital to cover the cost of retaining employees? Then the Paycheck Protection Program might be right for you.
  • A quick infusion of a smaller amount of cash to cover you right now? You might want to look into an Emergency Economic Injury Grant.
  • To ease your fears about keeping up with payments on your current or potential SBA loan? The Small Business Debt Relief Program could help.
  • Just some quality, free counseling to help you navigate this uncertain economic time? The resource partners might be your best bet.

ICIC’s Senior Vice President and Research Director Howard Wial outlines in his CARES Act Policy Brief how those in under-resourced areas will be impacted.

Please see below for resources that provide an overview of the CARES Act and its components.

Paycheck Protection Program (PPP) Extension

*UPDATE: Paycheck Protection Program has reopened*

For a list of resources that answer frequently asked questions on PPP loans and forgiveness, see below:

Paycheck Protection Program Flexibility Act (PPPFA)

 The U.S. Small Business Administration, in consultation with the U.S. Department of the Treasury, issued new and revised guidance for the Paycheck Protection Program (PPP).  This guidance implements the Paycheck Protection Program Flexibility Act (PPPFA), signed into law by President Trump on June 5, 2020.  Some of the changes in PPPFA include:

  • Extends the time limit for PPP borrowers to rehire workers until December 31, 2020.
  • Extends PPP until December 31, 2020.
  • Expands the covered period for loan use from 8 weeks to 24 weeks.
  • Provides several safe harbors and exceptions for rehiring employees.
  • Up to 40 percent of funds may now be used for non-payroll expenses.
  • Loans entered after June 4 now have a maturity date of five years, rather than the two-year period adopted by SBA and Treasury; earlier borrowers and lenders are permitted to renegotiate the duration of their loans.
  • Pushes off the start date for making principle and interest payments.

For the full list of revised rules and the new applications see below:

Paycheck Protection Program

The Paycheck Protection Program would provide cash-flow assistance through 100 percent federally guaranteed loans to employers who maintain their payroll during this emergency. If employers maintain their payroll, the loans would be forgiven, which would help workers remain employed, as well as help affected small businesses and our economy to snap-back quicker after the crisis.

PPP has a host of attractive features, such as forgiveness of up to 8 weeks of payroll based on employee retention and salary levels, no SBA fees and at least six months of deferral with maximum deferrals of up to a year. Small businesses and other eligible entities will be able to apply if they were harmed by COVID-19 between February 15, 2020 and June 30, 2020.

This program would be retroactive to February 15, 2020, in order to help bring workers who may have already been laid off back onto payrolls. Loans are available through June 30, 2020.

Small Business Debt Relief Program

The Small Business Debt Relief Program will provide immediate relief to small businesses with non-disaster SBA loans, in particular 7(a), 504, and microloans. Under it, SBA will cover all loan payments on these SBA loans, including principal, interest, and fees, for six months. This relief will also be available to new borrowers who take out loans within six months of the President signing the bill into law.

Economic Injury Disaster Loans and Emergency Economic Injury Grants

These grants provide an emergency advance of up to $10,000 to small businesses and private non-profits harmed by COVID-19 within three days of applying for an SBA Economic Injury Disaster Loan (EIDL).

To access the advance, you must first apply for an EIDL and then request the advance. The advance does not need to be repaid under any circumstance, and may be used to keep employees on payroll, to pay for sick leave, meet increased production costs due to supply chain disruptions, or pay business obligations, including debts, rent and mortgage payments.

U.S. SBA Economic Injury Disaster Loan Assistance

The U.S. Small Business Administration is offering designated states and territories low-interest federal disaster loans for working capital to small businesses suffering substantial economic injury as a result of the Coronavirus (COVID-19). You can find more information on which areas are eligible for SBA disaster loans here, and you can apply for emergency funding here.

U.S. SBA Express Bridge Loans

Express Bridge Loan Pilot Program allows small businesses who currently have a business relationship with an SBA Express Lender to access up to $25,000 with less paperwork. These loans can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing and can be a term loans or used to bridge the gap while applying for a direct SBA Economic Injury Disaster loan. If a small business has an urgent need for cash while waiting for decision and disbursement on Economic Injury Disaster Loan, they may qualify for an SBA Express Disaster Bridge Loan.

Small Business Contracting

If you are a government contractor, there are a number of ways that Congress has provided relief and protection for your business. Agencies will be able to modify terms and conditions of a contract and to reimburse contractors at a billing rate of up to 40 hours per week of any paid leave, including sick leave. The contractors eligible are those whose employees or subcontractors cannot perform work on site and cannot telework due to federal facilities closing because of COVID-19.

If you need additional assistance, please reach out to your local Small Business Development Center, Women’s Business Center, SCORE chapter, or SBA District Office. You should also work with your agency’s contracting officer, as well as the agency’s Office of Small and Disadvantaged Business Utilization (OSDBU).

Small Business Tax Provisions

Employee Retention Credit for Employers Subject to Closure or Experiencing Economic Hardship

This provision would provide a refundable payroll tax credit for 50 percent of wages paid by eligible employers to certain employees during the COVID-19 crisis. The credit is available to employers, including non-profits, whose operations have been fully or partially suspended as a result of a government order limiting commerce, travel or group meetings. The credit is also provided to employers who have experienced a greater than 50 percent reduction in quarterly receipts, measured on a year-over-year basis. Wages of employees who are furloughed or face reduced hours as a result of their employer’s closure or economic hardship are eligible for the credit.

For employers with 100 or fewer full-time employees, all employee wages are eligible, regardless of whether an employee is furloughed. The credit is provided for wages and compensation, including health benefits, and is provided for the first $10,000 in wages and compensation paid by the employer to an eligible employee. Wages do not include those taken into account for purposes of the payroll credits for required paid sick leave or required paid family leave, nor for wages taken into account for the employer credit for paid family and medical leave (IRC sec. 45S).

  • The credit is not available to employers receiving assistance through the Paycheck Protection Program. The credit is provided through December 31, 2020.

Delay of Payment of Employer Payroll Taxes

This provision would allow taxpayers to defer paying the employer portion of certain payroll taxes through the end of 2020, with all 2020 deferred amounts due in two equal installments, one at the end of 2021, the other at the end of 2022.

Payroll taxes that can be deferred include the employer portion of FICA taxes, the employer and employee representative portion of Railroad Retirement taxes (that are attributable to the employer FICA rate), and half of SECA tax liability.

  • Deferral is not provided to employers receiving assistance through the Paycheck Protection Program.

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