On Monday, April 13, 2020, the U.S. Small Business Administration (SBA) released an update on the CARES Act, which allows small businesses (500 employees or less) and non-profits impacted by COVID-19 to obtain an advance of up to $10,000 on their Economic Injury Disaster Loan (EIDL). The advance is designed to provide economic relief to businesses that are currently experiencing a temporary loss of revenue. According to the SBA, the exact amount of your advance will be calculated based on the number of your pre-disaster (i.e., as of January 31, 2020) employees and will provide $1,000 per employee (up to a maximum of $10,000). Once your application is submitted and accepted, the advance will be made available within just a few days. The loan advance will not have to be repaid.
As we noted earlier this month, there is also another loan program, known as the Paycheck Protection Program (PPP), which prioritizes millions of Americans employed by small businesses by authorizing up to $349 billion in forgivable loans – to be used toward job retention and certain other expenses – so that small businesses can continue to pay their employees during the COVID-19 crisis. Below is a comparison of the two loan programs:
If you would like to learn more about either loan, or if you need help determining which is best for your small business, please contact Brandon Caroprese directly using the contact information provided below.
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Caroprese & Company is a certified public accounting firm that provides innovative and strategic services to a diverse client base of individuals, families, small and medium size businesses, government entities, non-profits and multi-national corporations. Our dynamic professionals perform at a high intensity and are laser focused on providing excellence to our global clientele.
CONTACTING CAROPRESE & COMPANY
This publication is provided by Caroprese & Company as a service to its clients and colleagues. The information and content included in this publication should not be construed as technical advice. Questions regarding any matters discussed in this publication should be directed to Brandon Caroprese whose contact information is listed below:
Brandon Caroprese, CPA, MST