With the virtual shutdown of the nation due to the Covid-19 pandemic, the government has stepped up with the so-called CARES (Coronavirus Aid, Relief, and Economic Security) Act. As much of a helping hand as this is, small business owners such as you still need a way to financially account for their workforce.
Purpose of SBA Relief Loans
To this end, SBA relief loans have been approved by Washington to swoop in and effectively save the day. You can use just such a loan to infuse your business with liquidity, secure and maintain your workforce, and, ultimately, receive forgiveness of the loan at a future date. All that’s left is for the President to sign the mandate.
Payroll Protection and Small Business Eligibility
Although SBA loans have existed for quite some time now, the Paycheck Protection Program serves to expand the number of businesses that can take advantage of the guaranteed SBA relief loans. One of the most important attributes it confers is the possible forgiveness of a portion of the loans – assuming that your business satisfies the payroll requirements. If you have fewer than 500 employees, then you probably qualify. The CARES Act further has the potential to eliminate the previous restriction on small businesses that may have credit available elsewhere.
Loan Forgiveness Terms
You are required to adhere to just a few guidelines to qualify for loan forgiveness over the entire 8 week period, starting from the time you qualify and the funds are delivered – as long as the loan is proven to cover interest on debt, payroll costs, utility payments, leases, paychecks, etc. You can even rehire any lay-offs using this money. The SBA relief loan can ultimately become a government grant if you provide the documentation of legitimate use of the money.
If you’re a small business and can benefit from this aspect of the Paycheck Protection loan program, let an expert guide you through the process. Kasher Capital is comprised of such financial professionals, and we are available at your earliest convenience.