Information below provides full details and/or links for funding programs for small businesses.
DISCLAIMER: Legislation and information related to the COVID-19 economic crisis is rapidly changing. See Full Disclaimer
If you need immediate help, you can call us at 833-ASK-SBDC (833.275.7232)
1. Federal Funding Programs
BUSINESS FUNDING UNDER THE CARES ACT
- Economic Injury Disaster Loans (EIDL): SBA loans available to pay for expenses that could have been met had the disaster not occurred, including payroll and other operating expenses.
- PPP Round 2: Funding available through the banks, emphasizing payroll for employers and employees. Loan is forgivable if used per PPP guidelines.
- Small Business Debt Relief Program Loans: If you are a current borrower under SBA 7(a) (not through PPP), a 504 loan program or a microloan, you are eligible for debt relief and SBA will cover all loan payments for 6 months.
- Employee Retention Tax Credits for Employers Subject to Closure or Experiencing Economic Hardship: Direct tax credit to encourage employee retention.
- The Emergency Economic Injury Disaster Advance program has now ended. Economic Injury Disaster Loans are still available, but without the 'advance'.
OTHER CARES ACT FUNDING (not just for small businesses)
- Early Withdrawal from Retirement Accounts
- The Unemployment Supplement has now ended.
- The Provision for Individuals and Families has now ended.
NON-CARES ACT FEDERAL FUNDING
- Businesses can begin applying for FEMA Disaster Assistance while we await a disaster declaration to release additional disaster funds.
- SBA Bridge Loans are available to small businesses who currently have a business relationship with an SBA Express Lender, providing access to up to $25,000 quickly.
2. State of California Programs
- California Relief Grant has received funding for additional rounds (for a total of 6 rounds planned) and is administered by Lendistry.
- California Small Business Disaster Relief Loan Guarantee Program (via IBank). $50 million in state funding, providing potential capital for individuals who may not qualify for federal funds. Download pdf (English and Spanish information)
- California Capital Access Program (CalCAP) for Small Business encourages banks and other financial institutions to make loans to small businesses that have difficulty obtaining financing. CalCAP is a loan loss reserve program which may provide up to 100% coverage on losses as a result of certain loan defaults. Loans are available up to $5 million.
- California is also allowing the deferment of sales and use taxes of up to $50,000 for up to 12 months.
Details about the CARES Act - Federal Funding for Small Businesses
The CARES Act, or the Coronavirus Aid, Relief and Economic Security Act, is a $2 trillion economic stimulus package geared towards helping businesses, individual employees, and families mitigate the financial impacts of the COVID-19 outbreak. Below is an overview of the programs outlined, for a good overview of these programs, see the SBDC Guide to Understanding the CARES Act:
Economic Injury Disaster Loans (EIDL)
EIDLs are long-term loans used to pay fixed debts, payroll, accounts payable and other costs, but are not intended to replace lost sales or profits and cannot be used for certain purposes, including to refinance debt, make payments on loans owed by another federal agency, to pay tax penalty obligations, repair physical damages, or to pay dividends to stockholders. Actual loan amounts are based on amount of economic injury, though there is a limit. At this time, the specific amount of the limit is unclear.
WHO IS ELIGIBLE: Small businesses suffering substantial economic injury due to COVID-19 including:
- Businesses that offer services directly related to the businesses in the declaration
- Other businesses indirectly related the industry that are likely to be harmed by losses in their community
- Businesses of 500 employees or fewer including:
- Sole proprietorships, with or without employees
- Independent contractors
- Cooperatives and employee owned businesses
- Tribal small businesses
HOW TO APPLY:
- Contact the SBA Disaster Assistance to apply:
- See SBA Disaster Assistance Webpage Apply for EIDL
- Contact your local SBDC if you need help with an application for an SBA loan of any type:
Request help from the Napa-Sonoma SBDC
- Watch our recording on Facebook Live for a full overview - English | Spanish
- Download the Small Business Owner’s Guide to the CARES Act:
- SBA Small Business Guide to CARES Act
Small Business Debt Relief Program Loans
This program will provide immediate relief to small businesses with existing non-disaster SBA 7(a) loans, covering your loan payments for 6 months.
WHO IS ELIGIBLE: Existing recipients of SBA 7(a) loans (not through PPP), 504 loans or microloans.
LEARN MORE AND APPLY:
- 7(a) Loans (various types)
- 504 Loans
- Contact your local SBDC if you need help with an application for a loan of any type.
Request help from the Napa-Sonoma SBDC
Paycheck Protection Program (PPP) Loans: Round 2 is in process.
Employee Retention Tax Credit for Employers Subject to Closure or Experiencing Economic Hardship
This is a refundable payroll tax credit for employee retention, for 50% of wages paid to employees by employers during the crisis.
- Important: If you receive a Paycheck Protection Program loan, you cannot also receive the Employee Retention Credit. The Employee Retention Credit is an alternative CARES Act relief measure for businesses. Because you cannot claim both the tax credit and forgivable loan, you must determine which would most benefit your business. We suggest talking to your accountant about options for a payroll tax credit.
- Like PPP, the Employee Retention Credit is a fully refundable tax credit employers can claim if they don’t receive a PPP loan.
- This tax credit is equal to 50% of qualified wages eligible employers pay employees between March 12, 2020 – January 1, 2021. Eligible employers are those who must fully or partially suspend operations during any quarter in 2020 as a result of coronavirus. Employers whose gross receipts significantly decline are also eligible.
HOW TO APPLY:
No application needed. To claim the Employee Retention Credit, you will report your qualified wages and related credits for each calendar quarter on your federal employment tax returns (e.g., Form 941, Employer’s Quarterly Federal Tax Return). You can learn more about the Employee Retention Credit on the IRS’s website.
WHO IS ELIGIBLE: Small business employers whose operations have been affected, fully or partially suspended due to a shut-down order, or whose gross receipts declined by 50% or more compared to the same quarter last year. Available to employers, including non-profits, whose operations have been fully or partially suspended as a result of a government order limiting commerce, travel or group meetings.
THE 'FINE PRINT':
- For employers with 100 or fewer full-time employees, all employee wages qualify for the credit, whether the employer is open for business or shut down due to a shelter order.
- Credit to be provided for first $10,000 of compensation, including health benefits, paid to an eligible employee from March 13 through December 31st.
- Please download the Small Business Owner’s Guide to the CARES Act (pdf) for details:
SBA Small Business Guide to CARES Ac
CARES ACT PROVISION FOR EARLY WITHDRAWAL FROM RETIREMENT ACCOUNT
You can also withdraw from your retirement account without penalty, for up to $100,000 for eligible coronavirus-related purposes. Eligible withdrawals are limited to:
- Those who contract COVID-19, or whose spouse or dependent has contracted the virus,
- Those who experience adverse financial impacts as a result of being furloughed, laid off, quarantined, have hours reduced or are unable to work due to lack of childcare, the closing of or reduced hours of a business owned by the individual,
- "Or other factors determined by the Treasury Secretary." (this text taken from the CARES Act).
- This is the most up to date information that we know, compiled by SBA and the US Treasury Dept.
- The SBDC has no control over federal changes or revisions to the CARES Act. SBDCs are funded by the SBA and hosted by local municipalities, colleges, etc.
- We're doing our best to help clients in creating economic impact during this time of need. We will use this platform to continually update our communities as best we can.