Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) a $2 trillion coronavirus stimulus package passed into law through the House and signed by the president.
The law provides support to small businesses of $350 billion small business loan program; increases SBA loan amounts; delays payroll taxes for employers; and allows for other tax delays and benefits.
The most attractive for small businesses is the Payroll Protection Plan. In addition to small businesses, sole-proprietors, independent contractors, and other self-employed individuals are eligible for these loans. Non-profits and churches designated as 501(c)(3) organizations may also participate in the Paycheck Protection Loans (“PPL”) to cover payroll costs, interest costs, rent, and utilities.
It is a 100% guaranteed SBA 7a loan program with a debt forgiveness provision. It should cover 2.5 months of payments towards payroll costs, interest costs, rent, and utilities. The loan will be forgiven if you continue to pay the same number of hours to employees. Any amount used for business purposes but not payroll costs, interest costs, rent, and utilities will continue as a loan.
Please let us know if you have any questions: 219-230-3600 or Isaac@ccsklaw.com.
Full Text of the Law: https://www.congress.gov/bill/116th-congress/house-bill/748/text