Below is a summary of two new federal government programs recently signed into law. The ink is still drying, so we are still reviewing the fine print, but here are the basics:
Economic Injury Disaster Loan Program
- $10,000 quick up-front cash (generally forgiven unless you get PPP loan, then it must be paid back)
- Up to $2 Million
- 3.75% Interest 30 year term
- Apply online at https://covid19relief.sba.
gov/#/
Paycheck Protection Program (PPP)
- Loan amount = 2.5x Average Monthly Payroll or SE earnings for Schedule C filers (not including payroll taxes or contract labor)
- 4% Interest rate (deferred for 6-12 months) 2 year term
- Loan can be forgiven if used to pay for salaries, health insurance, rent, and utilities as long as you maintain pre-covid employees and pay rates (there is also a rehire provision if you have already let people go)
- S-Corp and C-Corp can apply 4/3/20
- Sole Proprietors can apply 4/10/20
- Contact your bank for an application
You can click this link for more details: https://www.sbc.
We advise anyone who is eligible to apply for the PPP loan.
To apply for a PPP loan, the first step is to contact your bank for an application. We are here to answer questions to the best of our ability, but we will be better able to assist you after you have the application.
And just to warn you, the process is not off to a smooth start. Very few people have received the EIDL in 3 days (as advertised), and most banks have not prepared their PPP process.