As you look for solutions in this time of uncertainty, your independent agent’s advice is more important than ever. As you adjust your operation during this temporary time of crisis, talk with your agent about how to mitigate new exposures to risk. Consider also how the Federal CARES Act may help.
CARES Act Highlights
On March 27, 2020, President Trump signed the “Coronavirus Aid, Relief and Economic Security Act,” also known as the CARES Act. Included in this unprecedented economic relief package is the Paycheck Protection Program that provides $350 billion of assistance to small businesses to help you keep your employees on payroll and cover important expenses through a forgivable loan program. Here are some of the highlights:
- Companies with under 500 employees can obtain loans of up to $10 million, with the size of the loan based on a business’s average monthly payroll for 2.5 months.
- Specific businesses, including hotels, casino hotels, restaurants and bars – with not more than 500 employees per location – also are eligible for this program.
- The loans can be used to cover payroll, employee benefits, mortgage, rent and utilities. And, the amount spent on those items between February 15 and June 30 is forgiven from the total loan amount.
- Self-employed individuals and independent contractors can also take advantage of this program.
- The loans are guaranteed 100% by the Small Business Administration.
What to Do Next
You can access these loans through any FDIC bank, credit union or fintech lender – just contact your local bank to get the ball rolling. Treasury Secretary Steve Mnuchin expects this loan program to be up and running by April 3, 2020, and for it to provide same day turnaround on loan requests.
For accounts that do not qualify for loans under the Paycheck Protection Program, the CARES Act affords other financial relief. These solutions may efficiently provide the funds needed to stay in business, keep your employees on the payroll and cover key expenses.