Last week, the US Congress passed the Coronavirus Aid, Relief, Economic Security Act (“CARES Act”). Included in this legislation are several resources for small to medium sized business, certain non-profits and other employers.
The CARES Act includes several business and individual provisions that assist during this pandemic. A link to the full EFPR blog about the CARES Act is HERE. A few of the key business takeaways include:
- Creation of $350 Billion Paycheck Protection Program (“PPP”), a loan program with various forgiveness provisions to assist in covering payroll and other expenses thru June 30th, 2020.
- 50% Refundable Payroll tax credit on certain wages during the crisis
- Deferral of Employer Social Security tax payments
- Expansion of NOL carryback provisions
EFPR Group has created an internal Covid-19 Task Force whose sole focus will be:
- Understand the eligibility requirements and benefits of various programs
- Determine how newly created benefits will impact other tax credits and incentives that already exist
- Assist all of our team members in counseling clients about what make sense to them
All loans provided under the PPP loan program will be administered by the SBA, with approved SBA lenders providing the application/underwriting. At this time, PPP loans are not being made. It is anticipated that this will start occurring as soon as the SBA builds out their infrastructure and instructs their network of lenders on how to process and administer. Trust that we are in constant contact with these resources, and that we will be able to assist our clients in this process as needed. Applications for SBA-related grants and disaster loans can be currently filed through their website. However, these funds could adversely impact your ability to have a PPP loan forgiven. Careful consideration must be given before you make a decision.
We have provided a few links to resources as well to assist business owners in gaining an understanding of the landscape.We recommend that you consult your accountant and lender for your best course of action, as everyone’s facts and circumstance differ.
As our client, we will help you navigate the best financial course forward during these uncertain times. Specific guidelines will be issued in the next few weeks and we will keep you informed of new developments that could affect your bottom line.