Small Business Relief Programs During the Coronavirus Pandemic

With government-mandated shutdowns and “Stay at Home” orders across the country, many businesses are taking a hit in this Coronavirus pandemic. Are you worried about the future of your company? Right now is the time to learn more about small business relief programs and how they can provide much-needed support during this challenging time.

Small Business Reality During the Coronavirus Pandemic

The current global health concerns and economic downturn are taking a toll on businesses of all sizes. But small businesses are feeling the biggest burdens since they don’t have the reserves to weather such a difficult environment.

Depending on your industry, it’s likely that you’ve laid off staff, adjusted services, or even closed your doors indefinitely. Just because the business needs to be closed, doesn’t mean that you get a break from overhead costs for your rent/mortgage, insurance coverage, business loans, and more.

In fact, many business owners have their hands full right now trying to figure out how to buy enough time to make it through the economic downturn. If you are sheltered in place at home (as many people are across the US), then your time is probably dedicated to business activities to coordinate orders with suppliers and stave off the debt collectors.

Not only are you facing the challenge of navigating the immediate needs of your business, but you are also likely feeling the stress of the future. What will it take so you have the cash to open the doors again when we get ahead of this pandemic? If you are struggling to pay your bills right now, then it might feel impossible to think about what it is going to require when things go back to normal again. Many business owners have the shared mindset that the “new normal” will be different than what we knew before the COVID-19 pandemic.

According to a Goldman Sachs survey, only 50% of small business owners will be able to make it through three months of the current pandemic and economic downturn. Almost all businesses are being affected, and many business owners are struggling to know what to do when the cash reserves are gone.

Are Bailouts Available for Small Businesses?

The news headlines have announced that a $2 Trillion bailout has been approved by the Federal government to help the United States through this unprecedented challenge. Checks are being sent to individuals and many bailouts are available for some of the largest industries being affected, such as the cruise companies and airlines. It leaves many of us wondering if small business relief programs will be offered for locally owned companies as well.

Rest assured to know that part of the bailout package includes $300 billion in the form of small business loans. These small business relief programs are designed to help companies with 500 employees or less.

The trick is to know where to look and what you need to do to qualify for the programs that are being offered for small businesses. Also, remember that we are only a few weeks into this pandemic, which means that many of these small business relief programs are still in the beginning stages. It will take some time to determine how the programs will be implemented.

Small Business Relief Programs: Options to Consider

Here are a few possible programs that might be beneficial to help your business during this challenging time:

Small Business Administration Loans:

Normally, the Small Business Administration (SBA) here in the United States offers a funding pool of $20 billion for small businesses. This pool has been increased to $50 billion to providing funding for business owners who need help. For example, if your business is suffering losses because of COVID-19, then low-interest disaster loans can be accessed up to $2 million per business.

This money can be used for whatever is needed to get through these hard times, such as paying bills, keeping up with debt payments, or covering payroll. To apply, the governor in your state must submit a declaration of emergency. Then, the application process can be done online or via mail. Also, don’t hesitate to contact your local SBA office to learn about potential services that might be available in your area.

State Funded Loan Programs:

While the SBA is a nationwide program, there are other local options that might be helpful for your small business. For example, some states have created small business relief programs to help with the Coronavirus pandemic. Visit your state’s website to look for information about available programs. City-based business loans have also been implemented in some of the largest cities in the US, such as New York City, Los Angeles, Denver, and Chicago.

Private Grants and Loans:

Other financing opportunities can be accessed through private lenders. Contact your business banking service or look to other offers that might be available for discounted business loans during the Coronavirus outbreak.

Private relief programs and waived service fees are being offered through large companies, such as:

  • Facebook: Ad credits and cash grants are offered for up to 30,000 small businesses.
  • Amazon: Cash grants offered for businesses with fewer than 50 employees and $7 million or less in annual sales.
  • GoFundMe: A small business relief fund has been set up to provide millions of dollars in small business relief programs.
  • Google: G Suite customers have free access to the advanced services through Hangouts video conferencing.
  • Uber Eats: Delivery fees are waived for orders coming from restaurants that are independently-owned.

If you are searching for new financing, be cautious and remember that scammers are actively trying to take advantage of unsuspecting individuals and business owners during this time. Never provide sensitive financial information without first verifying the reputation of the loan provider.

Tax Deferrals:

With the annual tax deadline looming, it might be hard to come up with the cash that is needed by April 15th. The IRS pushed the tax deadline back to July 15th, giving people more time to file their taxes and pay the amount that is owed. If you have pressing bills, then it makes sense to take advantage of this extra time. Business owners who need more time also have the opportunity to apply for a tax extension, which would push your filing due date to October.

Keep in mind that the automatic July 15th deferral applies for federal taxes. Many states have followed suit and extended state-level tax deadlines as well. You’ll need to check your local state guidelines to know when your taxes need to be filed and paid this year. The simplest solution is to talk to your accountant for personal recommendations regarding your filing and payments.

Also, if you are anticipating a tax refund, then it doesn’t make sense to wait on your tax filing. Instead, finish the paperwork as soon as possible so you can get the refund and use the money for your immediate business needs.

Credit Payment Deferrals

It’s worth your time to reach out to your individual creditors, including your mortgage company or any other lenders that you need to pay each month. Many of these financial institutions are offering payment deferments. For example, you might be able to skip a mortgage payment for 60 days if the cash isn’t available.

Consider the long-term effects of not paying a loan though. The interest costs will continue to accrue. You might be able to avoid late fees, but the interest can add up over time. Additionally, you need to be sure that you are prepared with cash in hand when it is time to pay the mortgage again. It might be a challenge to get caught up on two or three mortgage payments after the deferral period is over.

We’re in This Together

Even though the economy is slowing and sales are suffering, rest assured knowing that small business relief programs are available to help you get through whatever might happen in the upcoming months. It is important to know that you don’t have to navigate this challenging road without support. Tap into the resources that are available to keep you afloat until your business doors can open again.

Our team at Easier Accounting is here to assist if you need financial help during the current economic downturn. We understand the challenges that you are facing, and offer proven accounting services for businesses in all industries. If you need assistance with cash flow management, tax strategy, or anything else related to managing your business finances, then we are just a phone call away.

Whether you need information about small business relief programs or immediate accounting services for your business, we are working hard to keep our customers up-to-date in the financial industry. We invite you to schedule a consultation with our team at Easier Accounting to learn more about the ways your business can benefit from our services. We’ll gladly schedule a consultation to help you see why every business should be leveraging outsourced accounting for financial strategy, payroll, tax preparation, and more. Contact us at (888) 620-0770.

0 replies

Leave a Reply

Want to join the discussion?
Feel free to contribute!

Leave a Reply

Your email address will not be published. Required fields are marked *