5 Sources Of Cash Available RIGHT NOW To Help You Thru The Coronavirus Pandemic

Contributed by Small Business Expert Gene Marks

The Coronavirus pandemic isn’t going to last forever. But one thing’s for sure: It’s going to be a while before things get back to normal. For that to happen, we need better testing, viable treatments and a vaccine. All of this is in the works. But we have to be patient.

Of course, that’s of little consolation to those of us who need cash to run our small businesses. Many of us have either been shut down, made to send our employees home, or suffered significant losses in revenues. That’s why businesses like Thryv have been sharing COVID-19 resources often. But, as the pandemic progresses, you need help now.

The good news is there are at least five readily available sources of cash for us that we can tap today — right now. Here they are.

1. Economic Injury Disaster Loans

These loans are provided directly by the Small Business Administration. They are low interest (2.75 percent for nonprofits, 3.75 percent for forprofits) and long term — 30 years.

Businesses can borrow up to $2 million, and the turnaround time (although very slow as I write this due to demand) should improve significantly in the next few weeks.

These loans are open for any small business, contractor or sole proprietor. There are advances too — up to $10,000 for just applying and $25,000 for small business owners who have worked with the SBA before.

To qualify, you need to have fewer than 500 employees and submit certain financial information directly on the SBA website.

2. Paycheck Protection Program

In addition to the Economic Injury Disaster Loans, if you have fewer than 500 employees, you can also apply for forgivable loans under the Paycheck Protection Program.

These loans go through a bank or an online service like Kabbage, Lendio, PayPal, Square and Intuit. You can borrow up to $10 million, but the amount available is subject to a formula based on 2.5 times your payroll expenses.

Once borrowed, the loans are due in two years and have a one percent interest rate. However, a significant portion of these loans — the amount spent on payroll, utilities and rent over an eight-week period — may be forgivable.

• All the rules are here.
• A required document checklist is here.
• A great loan calculator is here.

3. Tax Credits and Deferrals

If you don’t participate in the Paycheck Protection Program, you can claim a refundable (that means cash back) tax credit of up to $5,000 per employee per quarter against your payroll taxes due that quarter. To qualify, the Coronavirus must have caused your business to shut down or suffer a more than 50 percent revenue decline. If you are paying for your employees’ time off as a result of a COVID-19 infection that impacted them or their families, you are also eligible for a refundable tax credit.

Regardless, you can defer whatever you’re paying in federal payroll taxes to 2021. Finally, your tax returns and final payment for 2019 have been delayed to July 15. However, if you think you’re getting a refund, it’s best to file your taxes now to get the cash back in six weeks.

4. Main Street Lending

The Federal Reserve and Treasury Department will soon make funds available under their Main Street Lending Program. Although geared toward medium-sized companies, it’s open for all businesses.

You must borrow a minimum of $1 million, up to $150 million. Interest rates are below four percent, and the maturity is four years. The funds can be used for operations but not to refinance existing loans. Once again, these are short-term loans designed to help businesses get through the pandemic.

5. Corporate Grants and State Relief

Many corporations and nonprofits are offering hundreds of millions of dollars in grants and loans for small businesses.

• Among them are Facebook, JP Morgan Chase, Verizon and The Opportunity Fund.
• Some companies, like Zoom, PandaDoc and Microsoft are offering discounted or free services.
• Many banks, such as PNC, Santander and TD Bank are waiving fees and providing payment deferrals and other relief for their small business customers.
• States and cities such as Los Angeles, Florida and Chicago have set up or adjusted existing relief funds and loans for local small companies. Check with your state’s website to see if grants or loans are available.

None of this cash replaces actual revenues from actual customers. But it does help. In a big way.