SBA Economic Injury Disaster Loan Program

Through the SBA, businesses of all sizes suffering substantial economic injury are eligible to receive low-interest federal disaster loans. Specifically, SBA’s Economic Injury Disaster Loans offer:

  • Up to $2 million in assistance to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact
  • The interest rate is 3.75% for small businesses and 2.75% for non-profits
  • SBA offers long-term repayment to keep payments affordable, up to a maximum of 30 years. Terms are determined case-by-case, based upon borrower’s ability to repay

Employee Retention Credits

Employee Retention Credits are refundable payroll tax credits for 50% of wages paid by employers to employees up to $10,000 per employee.  This is available to employers whose:
  • Operations were fully or partially suspended due to COVID-19 shut down order
  • Gross receipts declined by more than 50% when compared to last quarter
Employers over 100 employees receive credit only for employees that are not providing service due to virus.

Employer Payroll Taxes

Employer Payroll Taxes can be deferred through the remainder of 2020. 

  • Employers and self-employed may defer 6.2% payroll tax through 2020
  • Taxes must be paid back over a period of the course of two years, equally by December 31, 2022
  • Ensures solvency of Social Security Trust Fund

Modifications of Net Operating Losses for Business

The CARES Act increase the number of years a business can utilize carry-back losses.
  • Businesses that had a loss in 2018, 2019, or 2020 can carry back losses for five years to help lower taxes
  • S-Corps and other entities granted loss flexibility

Qualified Improvement Depreciation

Qualified Improvement Depreciation can be utilized to immediately depreciate property, plant, and equipment. Qualified Improvement Depreciation can be taken immediately vs. 39 years (tax reform error). Senator Graham cosponsored S.803 to address this. 

Payroll Protection Program

Through the Small Business Administration, businesses of under 500 employees per location are eligible to receive up to 8 weeks of cash flow assistance through federally guaranteed loans. Importantly, if the employer receiving the loan maintains payroll and does not terminate employees, the portion of the loan used to meet payroll, mortgage obligations, rent, and utilities will be completely forgiven.  This is designed to ensure businesses can retain their workers and applies retroactively to February 15, 2020, to help bring workers who may have already been laid off back onto the payroll.