The U.S. House of Representatives passed the Paycheck Protection Program and Health Care Enhancement Act (PPPHCEA) this week, which will provide additional funding for small business programs that were administered and created by the SBA through the CARES Act.
The $484 billion PPPHCEA bill was already approved by the Senate and has already been signed by the President. This budget includes:
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$320 billion for the PPP to help small businesses
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$60 billion for the EIDL
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$75 billion for hospitals
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$25 billion for coronavirus testing
While it’s not clear when the new funds for these programs will be available or how long they will last, the best course of action is to sign up for those programs as soon as possible! The initial $349 billion in PPP funding from the CARES Act was already fully allocated within 13 days.
If you're unsure what is the difference between the EIDL or the PPP, click here to learn about the programs from our previous webinars. If you have questions or need additional help, contact us today!
As time passes during this pandemic, there have been many programs like EIDL (Economic Injury Program Loan) and PPP (Paycheck Protection Program) that have been incorporated by the CARES Act to help small business owners obtain enough cash to survive.
Unfortunately, small business owners are still waiting to receive the funds from these programs. Many are frustrated that they have received no funds or support from the SBA. There is a lot of uncertainty and we understand the frustration with the small business owners who were neglected by the very programs that were supposed to help them during this crisis.
Thankfully there are ways to still survive this, you have the option to defer payroll taxes or get Employee Retention Credit. CARES Act allows you to defer the employer's portion of social security. Employee Retention Credit is a refundable tax credit that is equal to 50% up to $10 K in wages paid of an eligible business owner. If you qualify, you can fill out form 7200 to request for the credit to be reimbursed in cash.
If you're still confused or have questions about how to defer payroll taxes or to get the employee retention credit. We invite you to join our FREE webinar on April 22nd on how to do that and more so you can get the money you need to survive this crisis.
If you missed out on the EIDL (Economic Injury Disaster Loan) and the PPP (Paycheck Protection Program), don't worry, there is another way to access funds to keep your business and your employees.
The Employee Retention Credit is a refundable tax credit that is equal to 50% of the “qualified wages” of each employee of an “eligible employer”. The credit is calculated on a calendar quarter basis and is applied against “applicable employment taxes” i.e. employer portion of Social Security tax (6.2% of wages). The credit is 50% up to $10,000 in wages paid for each employee, so the maximum credit is $5,000.
Who is qualified to apply? Employee retention credit is offered to businesses who were either suspended fully or partially due to COVID-19 or have experienced a significant decline in gross receipts. Hence, this refundable tax credit is important for those who haven't been able to receive EIDL or PPP loan. Please note that this credit does not apply to employee income tax withholding, the employee or employer portion of Medicare tax, or the employee portion of Social Security tax.
If you are confused or have questions about Employee Retention Credit, please contact us today. We also have a webinar on April 22nd that will go over payroll deferral, paid leave credit, retention credit, and many more! Sign up today!
Texas Governor Greg Abbott is planning to reveal strategies to slowly reopen businesses in Texas to revitalize the economy. The governor recently announced that Goldman Sachs and LiftFund will provide $50 million of loans through SBA's PPP program to qualifying Texas small businesses. These loans will be primarily used for payroll purposes to ensure employers retain employees during the current crisis. If the employer complies with all of the required regulations, the loan will be fully or partially forgiven by the SBA.
LiftFund is a non-profit organization that helps small businesses facing financial hardships with limited access to capital. It has partnered with the SBA to offer these disaster relief loans up to $50,000. LiftFund along with other financial institutions will be administering the funds to qualifying small businesses in Texas. You can apply for this SBA-backed PPP loan on the LiftFund website.
Business owners who haven't heard of LiftFund may have questions or concerns about their loan like:
- I've applied PPP through my bank, does this mean I can apply for this loan as an additional backup?
No, you will be duplicating loan applications to the same SBA-banked programs. - I couldn't get PPP loan through my bank, will I get rejected by LiftFund too?
Not necessarily, the criteria may vary slightly since LiftFund is catered for business owners who are not able to apply through financial institutions. - What would be the difference between applying PPP through my bank vs LiftFund?
To apply through a bank, the applicant needs to have a banking relationship with the bank. Anyone can apply through LiftFund.
If you need help or have questions about this SBA-backed PPP loan, make sure to contact us today!
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Consider yourself lucky if you can run your business through WFH, however not many small business owners have that privilege. Restaurant owners, hairstylists, dentists, education centers, and retailers just to name a few, are all in the same boat. They all serve people directly and are now on forced furlough through shutdowns, lockdown, and whatnot. How long is this going to go on? Nobody knows. The more serious question that keep business owners awake at night in their hunkered down-home is - how long can my cash flow sustain my business. I still have to pay vendors, rents, and most importantly, myself and employees that I have not put on furlough or laid off.
This is not the end. One day the dark clouds will scatter, like all crisis we've gone through. One day, business will be back to usual. The question is, did your business manage to weather the storm? Did you give up and write off all your blood, toil, tears, and sweat; and let fate decide your future?
We have many answers and more with the article our founder has written, learn more:
https://www.linkedin.com/pulse/business-time-corona-andre-siaw/
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