CARES Act Offers Businesses Financial Assistance


May 25, 2020

 

On March 27, 2020, Congress passed, and the President signed the Coronavirus Aid, Relief and Economic Security Act of 2020 (“CARES Act”). The CARES Act is the third phase of the Congressional relief bills aimed at providing economic aid to those impacted by the COVID-19 pandemic and the associated economic decline. The CARES Act establishes new economic programs for businesses, builds upon programs implemented in Congress’ Phase II relief bill – the Families First Coronavirus Response Act (“FFCRA”), and provides tax relief and other benefits for businesses.  

 

We have a series of articles that offer a look at certain financial assistance available to businesses under the CARES Act:

 

 

CONGRESS INCREASES APPROPRIATIONS TO CARES ACT PROGRAMS

Congress passed the Paycheck Protection Program and Health Care Enhancement Act with an additional $480 billion for Small Business Administration (SBA) programs and health care providers on April 23, 2020.

 

 

PAYCHECK PROTECTION PROGRAM

The CARES Act establishes a new Paycheck Protection Program under the Small Business Administration’s Section 7(a) loan program designed to help eligible businesses stay open and retain employees by providing loans to pay operational costs during the COVID-19 emergency. These loans are forgivable if the borrower complied with certain conditions on how the funds are spent. This program is different from the existing SBA loans and the SBA Economic Injury Disaster Loan (“EIDL”) under Section 7(b) of the SBA Act established under the FFCRA.  

 

 

WEBINAR: USING PPP LOAN PROCEEDS TO MAXIMIZE FORGIVENESS

Watch our May 18 webinar discussing loan forgiveness under the CARES Act’s Paycheck Protection Program. Issues covered included forgivable expenses, different types of reductions in forgiveness, exemptions, and best practices.

 

 

HOW TO APPLY FOR A PAYCHECK PROTECTION PROGRAM LOAN

PPP loans are available on a “first come, first served” basis and each eligible borrower can apply for only one loan.  A summary for eligible borrowers on how to apply for a PPP loan based upon the SBA’s interim final rule.

 

 

7 FAQS ON UPDATED GUIDANCE TO PAYCHECK PROTECTION PROGRAM

Since the passage of the CARES Act and the initial Interim Final Rule issued by the Small Business Administration,  additional guidance has resulted in confusion for many applicants. Here are answers to seven commonly asked questions about the PPP.

 

 

PPP LOAN FORGIVENESS: AN OVERVIEW

A review of the CARES Act’s standards for loan forgiveness.

 

 

BEST PRACTICES TO MAXIMIZE PAYCHECK PROTECTION PROGRAM LOAN FORGIVENESS

This article suggests nine best practices to ensure maximum forgiveness for PPP loans.

 

 

WHAT PPP LOAN BORROWERS NEED TO KNOW ABOUT THE INTERIM FINAL RULES ON PPP LOAN FORGIVENESS

The Small Business Administration issues Final Interim Rules elaborating on the Paycheck Protection Program loan foregivness process.

 

 

SBA ANNOUNCES NEW SAFE HARBOR FOR PPP LOAN BORROWERS

The SBA’s FAQ #46 provides certainty to those borrowers with PPP Loans of less than $2,000,000.

 

 

TOP TEN TAKEAWAYS FROM SBA’S NEWLY RELEASED PPP LOAN FORGIVENESS APPLICATION

The Small Business Administration (SBA) released the much-anticipated Paycheck Protection Program (PPP) loan forgiveness application and we have a look at the most interesting elements from the application and its instructions.

 

 

FED LAUNCHES MAIN STREET LENDING PROGRAMS FOR SMALL AND MID-SIZED BUSINESSES

On April 9, 2020, the Federal Reserve Board announced a number of actions it had taken to provide up to $2.3 trillion in loans to support the economy, including implementing Main Street Lending programs. 

 

 

CHARITABLE GIVING: TAX PLANNING OPPORTUNITIES

The CARES Act includes several provisions expanding charitable giving incentives.

 

 

EXPANSION OF OTHER LOANS PROGRAMS

The CARES Act expanded a number of additional programs to offer financial support for businesses during the pandemic, including SBA Express Loans, Economic Injury Disaster Loans, emergency grants and subsidies. 

 

 

NEW AND MODIFIED TAX PROGRAMS UNDER CARES ACT

The CARES Act's package of tax provisions includes a new tax credit, delay of payroll taxes, temporary exception for excise taxes, and relief from certain aspect of the Tax Cuts and Jobs Act of 2017. 

 

 

RMD WAIVERS UNDER THE CARES ACT

The CARES Act provides that the required minimum distribution rules for a number of retirement plans shall not apply for 2020, including IRAs, Roth IRAs, qualified “defined contribution” plans, 403(b) plans, and government-employer-type 457 plans.

 

 

CARES ACT: EMPLOYEE BENEFIT PROVISIONS

The CARES Act included several employee-benefits related provisions.  

 

 

WHAT CARES ACT MEANS FOR HIGHER EDUCATION INSTITUTIONS

The CARES Act authorized $30 billion to go directly to education to ease the financial impact caused by COVID-19, roughly $14 billion of which will go directly to higher education institutions and their students. 

 

 

CARES ACT PROVIDER RELIEF FUND

 The CARES Act authorized $100 billion for healthcare provider relief related to COVID-19 losses, with an immediate infusion of $30 billion authorized by the Department of Health and Human Services on April 9. 

 

 

ADDITIONAL DISTRIBUTION FROM CARES ACT PROVIDER RELIEF FUND

HHS announced another $20 billion in payments for the CARES Act Provider Relief Fund in addition to the previous allocation of $30 billion.

 

 

CARES ACT: MORE THAN STIMULUS MONEY

The CARES Act and local laws provide business and individuals more tools for economic relief than just money. 

 

 

CARES ACT PROVIDES INCREASED OPPORTUNITIES FOR INDIVIDUALS TO DEDUCT CHARITABLE CONTRIBUTIONS

The CARES Act provides opportunities for individual taxpayers to increase tax deductions claimed on charitable contributions made during 2020.

 

 

MEDICARE ACCELERATED AND ADVANCE PAYMENT PROGRAM

Section 3719 of the CARES Act allows healthcare providers to receive advanced payments from the Medicare Program under the Centers for Medicare & Medicaid Services Accelerated and Advance Payment Program.

 

 

FEDERAL RELIEF FOR HEALTHCARE PROVIDERS

The CARES Act included an appropriation of $100 billion into the Public Health and Social Services Emergency Fund  for relief funding for healthcare providers, and the Paycheck Protection Program and Healthcare Enhancement Act passed on April 23rd included an additional $75 billion to this Emergency Fund.