There are opportunities for small-business funding in Illinois that are now available as a result of the recent bipartisan coronavirus relief bill that Congress recently passed.
• Paycheck Protection Program (PPP) – Applications for first-time borrowers are now open; applications for borrowers who have previously received a loan open Wednesday, Jan. 13
• Economic Injury Disaster Loan (EIDL) – Application deadline extended until December 31, 2021
Paycheck Protection Program Now Accepting Applications
This round of the PPP continues to prioritize millions of Americans employed by small businesses by authorizing up to $284 billion toward job retention and certain other expenses through March 31, 2021. It also allows certain existing PPP borrowers to apply for a Second Draw PPP Loan. PPP has successfully provided 5.2 million loans worth $525 billion to America’s small businesses.
Apply here for First Draw PPP Loan, or apply here for Second Draw PPP Loan.
Key updates include:
• PPP borrowers can set their PPP loan’s covered period to be any length between 8 and 24 weeks to best meet their business needs;
• PPP loans will cover additional expenses, including operations expenditures, property damage costs, supplier costs, and worker protection expenditures;
• The Program’s eligibility is expanded to include 501(c)(6)s, housing cooperatives, direct marketing organizations, among other types of organizations;
• The PPP provides greater flexibility for seasonal employees;
A borrower is generally eligible for a Second Draw PPP Loan if the borrower:
• Previously received a First Draw PPP Loan and will or has used the full amount only for authorized uses;
• Has no more than 300 employees; and
• Can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020.
Economic Injury Disaster Loans – Currently Accepting Applications
The SBA’s Economic Injury Disaster Loan program announced that the application deadline has been extended to Dec. 31, 2021 as a result of the recent stimulus bill. These SBA loans provide small businesses with a long-term, low interest loan to help them survive the COVID-19 crisis.
Note that these are loans, and not grants like the PPP may turn into. Applicants can apply for both EIDL and PPP loans simultaneously, although the funds cannot be used for the same purpose.
The SBA’s EIDL application is available here.
Employee Retention Tax Credit (ERTC) Expanded
The recent COVID stimulus bill extends and expands the CARES Act’s refundable ERTC, which encourages businesses to keep more workers on payroll.
To receive this credit, eligible employers can report wages on their quarterly employment tax returns with a Form 941.
Key updates to the ERTC under the new stimulus bill include:
• Businesses can now take advantage of both PPP and the ERTC
• For wages paid after January 1, 2021, the ERTC can be applied to 70% of qualifying wages of up to $10,000 per quarter
• Businesses with 500 or fewer employees are eligible to claim the ERTC if they had a revenue reduction of 20% or more in 2020
• Businesses must have partially or fully suspended all operations in 2020 or 2021 to qualify
SBA to Host Shuttered Venue Operators Grant Webinar on Jan. 14
On Thursday, Jan. 14, at 2 p.m. CT, the U.S. Small Business Administration is hosting a webinar to give a preliminary overview of the Shuttered Venue Operators Grant program included in the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act. Eligible organizations with a reduction in revenue due to the COVID-19 pandemic will have the opportunity to receive up to a $10 million grant under the program. This webinar will provide introductory information about the grants, who can apply, how potential organizations can prepare, and additional details re: eligibility and applications.
As we move forward, you can stay up to date on the Shuttered Venue Operators Grants by following the SBA on Twitter, subscribing to SBA’s e-newsletter, and visiting www.SBA.gov. More specifically, the best source of accurate information for all economic aid programs administered by the SBA is / will be at www.SBA.gov/coronavirusrelief.