This just in!
I am excited to inform you that new information has just been released. A Coronavirus Rescue Package of $748 billion dollars has just been announced! This may sound like a lot but it is much less than the previously proposed $2.2 trillion package.
What does it include?
- $25 billion to provide emergency rental assistance that could be used to cover past and future rent payments as well as other related expenses and extension of eviction moratorium through January 31, 2021.
- PUA: Pandemic unemployment assistance fro Federal government $300 a week in addition to state unemployment benefits through March 2021 (16 weeks)
- More PPP & EIDL Funding: $325 Billion is allocated to small business in the form of PPP funds.
- Extension of student loan forbearance through April 1, 2021
- Additional $35 billion in Healthcare Provider Relief Funds including $7 billion for rural providers
- $12 billion in CDFI/MDI target emergency investments to help low income and minority communities facing COVID-19
- Repurposed unused Treasury CARES funding and PPP Funding
Although this bill has not yet gone to an official vote, and is still being negotiated in congress, the $748 billion is what all parties have tentatively agreed on. What is NOT going to be in the bill, as it is too controversial, is any guidelines or protections on the liabilities of corporations as it relates to COVID, as well as state and local government funding.
The second funding proposal is as follows:
- $152 billion distributed to states
- $8 billion in funds for Tribes
- Extending deadline for spending CARES Act Coronavirus Relief Fund (CRF) on COVID-related expenses
Still to be determined…
On the negotiating block is stimulus checks. Talks are happening to include stimulus checks in the amount of $600-700 per individual and more for family with children, though they haven’t determined the amount yet.
The vote was supposed to happen by Friday, December 18th, which is unlikely. This means another Stop Gap will happen to fund the government until December 23/24 in order for a bill to pass. Both parties are wanting to push this through but we would be remiss to say party politics are not playing a part. The stimulus checks that Republicans were not in favor of now are very in favor of as their support of stimulus checks they hope to sway the vote in Georgia for the two senate seats that are up for election.
PPP & EIDL process
- EIDL $10k advance is repealed.
- Internal record keeping will be required for PPP loans from $150 to $2million but is not required to submit for forgiveness approval (kept only for potential audit).
- PPP choice of Seasonal business can choose 12 week time period in 2019
- Ability to apply for a second draw PPP loan for businesses with 300 employees or less, 30% decline in revenue in any quarter in 2020 compared to 2019 and is not considered a public company.
- Simplified option (1 pager) for forgiveness of loans under $150k.
- PPP expenses will be allowed as deductions for tax purposes when used for the PPP loan (if forgiveness is approved after the date of enactment of this new act, see Page 13 & 14 of the bill…”this subsection shall ONLY apply with respect to a loan which forgiveness is provided…AFTER the date of enactment of this act”).
What you can do to prepare:
- Figure out if you are eligible. Your business must have a % decrease in revenue from 2019 to 2020. How this is determined is to pick any 3 months in 2020 and compare to the same 3 months of 2019. If there is a 30% decrease then your business would be eligible for PPP funding. *Loan forgiveness processes are more simplified for borrowers under $150k in loans.
- Prepare the application and apply as soon as possible, as there will be limited funding.
Whether you have received the loan before and want to receive another one, or if you have not applied or had issues with previous banking organizations and would like to apply through me, I encourage you to book an appointment so we can determine the next steps together. If you are a new client, your first consultation is free! Book Now