BUSINESS GUIDE TO THE CARES ACT by the City of Cleveland
- Small Business Administration Economic Injury Disaster Loans
- Up to $2,000,000 in assistance available per business
- 75% Interest Rate for businesses, 2.75% Interest Rate for non-profits
- Other terms case-by-case; up to 30-year term
- Used to pay fixed debts, payroll, accounts payable
- SBA EIDL – EMERGENCY GRANT Program
- Eligible entities that have applied for an EIDL may request an advance of up to $10,000
- SBA to distribute emergency advance within three days of request
- Advance may be used towards paid sick leave, payroll, increased costs of materials, rent/mortgage payments, and other obligations
- Does not need to be repaid!
- SBA Express Bridge Loan Pilot
- Existing SBA Borrowers may be able to access up to $25,000 in funds.
- Funds can be repaid in full or in part by EIDL proceeds
- SBA 7(a) Payroll Protection Program Loan
- Up to $10,000,000 loan, roughly equal to 2.5x the company’s average monthly payroll
- Loan proceeds to support payroll (including benefits), insurance premiums, and mortgage, rent, and utility payments
- Required certifications:
- Business impacted by COVID-19 economic conditions
- Use funds to maintain workers and payroll
- Not receiving duplicative funds from another SBA Program
- Uncollateralized
- No loan payments for at least six months
- Loans eligible for partial forgiveness based on a formula
- SBA Existing Small Business Loans Subsidy
- Applies to existing loans under SBA 7(a), 504, and Micro-loan
- SBA will pay principal, interest, and fees for existing covered loans for a six month period
- New SBA loans under these programs (except those under the Payroll Protection Program) will receive six months of payments
- Payroll Tax Deferral
- Businesses can defer payment of the employer’s share of FICA taxes through the end of 2020.
- Payments must be made in 2021 and 2022.
- Deferral is prohibited for businesses using the SBA Payroll Protection Program
- Employee Retention Tax Credit
- Eligible entities include businesses whose operation is (1) fully or partially limited by government order, or (2) has experienced a 50% decline in gross receipts from the prior year quarter
- Eligible for a tax credit of 50% on the first $10,000 of certain wages incurred or paid from March 13,2020 through Dec. 31, 2020.
- Employers receiving certain SBA loans may not take the credit.
