Coronavirus (COVID-19): Business Resources

Economic Injury Disaster Loans and Loan Advance

To apply for a COVID-19 Economic Injury Disaster Loan, click here.

In response to the Coronavirus (COVID-19) pandemic, small business owners, including agricultural businesses, and nonprofit organizations in all U.S. states, Washington D.C., and territories can apply for an Economic Injury Disaster Loan. The EIDL program is designed to provide economic relief to businesses that are currently experiencing a temporary loss of revenue due to COVID-19.

SBA is accepting new Economic Injury Disaster Loan (EIDL) applications from all qualified small businesses, including agricultural businesses, and private nonprofit organizations through December 31st, 2021.

If you have already applied via the streamlined application portal, please do not resubmit your application.

SBA Disaster Loan Assistance

SBA Extends Deferment Period for all COVID-19 EIDL and Other Disaster Loans until 2022

WASHINGTON – The U.S. Small Business Administration announced extended deferment periods for all disaster loans, including the COVID-19 Economic Injury Disaster Loan (EIDL) program, until 2022.

• All SBA disaster loans made in calendar year 2020, including COVID-19 EIDL, will have a first payment due date extended from 12-months to 24-months from the date of the note.
• All SBA disaster loans made in calendar year 2021, including COVID-19 EIDL, will have a first payment due date extended from 12-months to 18-months from the date of the note.

Existing SBA disaster loans approved prior to 2020 in regular servicing status as of March 1, 2020, received an automatic deferment of principal and interest payments through December 31, 2020. This initial deferment period was subsequently extended through March 31, 2021. An additional 12-month deferment of principal and interest payments will be automatically granted to these borrowers. Borrowers will resume their regular payment schedule with the payment immediately preceding March 31, 2022, unless the borrower voluntarily continues to make payments while on deferment. It is important to note that the interest will continue to accrue on the outstanding balance of the loan throughout the duration of the deferment.

For questions about or relating to an EIDL loan application please contact the SBA disaster assistance customer service center. Call 1-800-659-2955 or email disastercustomerservice@sba.gov

Information updated 10.19.2021

The Paycheck Protection Program provided small businesses with zero-fee loans of up to $10 million to cover payroll and other operating expenses. Up to 8 weeks of payroll, mortgage interest, rent, and utility costs could be forgiven. Payments on principal and interest are deferred for one year.

Paycheck Protection Program is currently closed. 

Learn more about applying for forgiveness.

View more details directly from the U.S. SBA website: www.sba.gov

Application and additional information: U.S. Department of the Treasury

Information updated 10.19.2021

As of March 27^th, 2020

Overview
The Coronavirus Aid, Relief, and Economic Security (CARES) Act provides relief for small businesses that have trouble covering payroll and operating expenses because of the COVID-19 pandemic. The new law creates a Small Business Administration (SBA) loan program, called the “Paycheck Protection Program” (PPP), that expands benefits and eligibility for SBA disaster loans, covers payments on existing SBA loans, and creates new tax credits to help cover the cost of paid leave and payroll.

Debt Relief for New and Existing SBA Borrowers

For small businesses that already have an SBA loan (such as a 7(a), 504, or microloan) or take one out within 6 months after the CARES Act is enacted, the SBA will pay all loan costs for borrowers, including principal, interest, and fees, for six-months. SBA borrowers may also seek an extension of the duration of their loan and delay certain reporting requirements.

Relief for Small Business Government Contractors

If you are a government contractor, there are a number of ways that Congress has provided relief and protection for your business. Agencies will be able to modify terms and conditions of a contract and to reimburse contractors at a billing rate of up to 40 hours per week of any paid leave, including sick leave. The contractors eligible are those whose employees or subcontractors cannot perform work on site and cannot telework due to federal facilities closing because of COVID-19. If you need additional assistance, please reach out to your local Small Business
Development Center, Women’s Business Center, SCORE chapter, or SBA District Office. You should also work with your agency’s contracting officer, as well as the agency’s Office of Small and Disadvantaged Business Utilization (OSDBU).

Employee Retention Tax Credit

The CARES Act creates a refundable payroll tax credit for businesses, large and small, that retain their employees during the COVID-19 crisis. Employers are eligible if they have been fully or partially suspended as a result of a government order, or they experience a 50% reduction in quarterly receipts as a result of the crisis. For employers with 100 or fewer full-time employees, they may claim a credit for wages paid to all of their employees, up to $10,000 a person. For employers with more than 100 employees, they may claim a credit for those
employees who are furloughed or face reduced hours as a result of the employer’s closure or economic hardship. The Department of the Treasury is authorized to advance payment of the employee retention tax credit. This tax credit is not available if the employer takes an SBA paycheck protection loan.

Payroll Tax Delay

The CARES Act allows employers to delay paying the employer-portion of payroll taxes through the end of 2020. The deferred amount is due in two installments—50% is due before December 31, 2021, and the other 50% is due before December 31, 2022. Deferral is not available if the employer takes an SBA paycheck protection loan.

Advance Payment of Tax Credits for Paid Leave

The CARES Act allows the Treasury to send advance payments of tax credits available to employers that are required to provide up to 12 weeks of coronavirus-related paid leave to their employees.

Business Tax Relief

The CARES Act provides other forms of tax relief for businesses, including loosening requirements for net operating losses, and limitations on business interest deductions. The CARES Act also permanently fixes the qualified improvement property (QIP) error in the 2017 tax law, so that QIP investments are entitled to 100% recovery over 15 years. Distillers are exempt from excise taxes on undenatured alcohol for the purpose of producing hand sanitizer.

Delay for Single Employer Pension Plans

Single employer pension plans are allowed to delay quarterly contributions for 2020 until the end of the year. Employers may also use 2019 funded status for the purposes of determining funding-based limits on plan benefits for the plan years that include 2020.

Details provided by Office of Senator Brian Schatz

Information Updated 3.31.2020

America’s SBDCs are working to help small businesses address the business challenges of the coronavirus disease 2019 (COVID-19) pandemic.

View more information regarding OSHA, Facebook for Business, and a COVID-19 Resources for Business booklet was developed by the California SBDC for California small businesses, but it contains information that is useful for businesses throughout the USA.

View more at America’s SBDC website

Below is a list of potential financial resources to assist with cash flow issues during this time:

• Local Lenders:
  First, visit with your current loan provider or personal banker.

• SBA Disaster Relief program:
  See the first section on this page for more detail and application.

• CRF USA:
  Community Reinvestment Fund, USA works to address social and economic inequity through new financial solutions that help empower people, build sustainable communities and inspire systemic change.

• People Fund:
  In addition to the normal financial options we offer for business owners (find a list of our loans here) we are providing free business coaching, disaster preparedness information and we can help you find the resources you need. To take advantage of this help via Zoom meeting or phone call, please submit a request at https://peoplefund.org/edclient/.

• LiftFund:
  A Small Business Lender With A Social Impact

• BCL of Texas Small Business COVID-19 Relief (CDFI)
  BCL of Texas has been front and center during multiple economic and disaster recoveries to help small businesses and local communities get back on their feet. BCL of Texas has the experience and partnerships to help small businesses weather the storm and connect to the resources you need for your small business. Contact: 214-688-7456 Dallas | 512-912-9884 Austin
  Apply at: https://bcloftexas.org/lending/lending-inquiries

• Tom Green County Revolving Loan Fund:
  Contact person: Albert Rodriguez email: albert.rodriguez@cvcog.org

• The Rural Business Revolving Loan Fund
  The Fund is self-perpetuating through loan repayments by borrowers where the revolving characteristic will allow it to serve as a long term loan source for start-up and expanding business in the future. The Fund is capitalized at $68,600 grant funding provided by the U. S. Department of Agriculture where $53,000 of in-kind contributions were provided from local units of government, economic development entities, chambers of commerce, industrial foundations and businesses (Regional Economic Development Council) in preparation of implementing a Revolving Loan Fund (RLF).

• For the Rural Areas
  You should also consider discussing resources available in your specific area with your local EDC or Chamber of Commerce.

• SOAR Fund
  The Southern Opportunity And Resilience (SOAR) Fund provides flexible, affordable capital and free business support services to small businesses and nonprofits across the south and southeast to help them navigate and rebuild from the Covid-19 economic crisis.

The Shared Work program provides Texas employers with an alternative to layoffs. TWC developed this voluntary program to help Texas employers and employees withstand a slowdown in business.

Shared Work allows employers to:

• Supplement their employees’ wages lost because of reduced work hours with partial unemployment benefits.
• Reduce normal weekly work hours for employees in an affected unit by at least 10 percent but not more than 40 percent; the reduction must affect at least 10 percent of the employees in that unit.

Learn more by contacting TWC directly:

• Call TWC’s Shared Work Department at 512-340-4337
• Email: ui.sharedwork@twc.state.tx.us
• Website: https://twc.texas.gov/businesses/shared-work

General information provided to employers from the TWC: https://twc.texas.gov/news/covid-19-resources-employers

National Federation of Independent Business Resources:

NFIB Getting your Business Ready for Coronavirus

NFIB Study: Coronavirus Impact on Small Businesses

The NFIB Research Center’s new survey on the current impact of Coronavirus on small businesses. NFIB will continue to survey small business owners to hear how it has affected them first-hand.

NFIB Legal Resource: How Small Business Can Prepare for Coronavirus

The NFIB Small Business Legal Center provided information on other employment laws owners should consider during this time including the Americans with Disabilities Act, the Family and Medical Leave Act, and the Occupational Safety and Health Act.

See all resources provided by the NFIB

President Trump signed a coronavirus relief package into law on Wednesday night (March 18th, 2020) that provides paid leave benefits and additional unemployment benefits for U.S. workers.

Some modifications have been made in the Biden Administrations’ American Rescue Plan

There are six qualifying reasons for coverage under this bill. The National Law Review Describes them as follows:

1. The employee is subject to a federal, state, or local quarantine or isolation order related to Covid-19;
2. the employee has been advised by a health care provider to self-quarantine due to concerns related to Covid-19;
3. the employee is experiencing symptoms of Covid-19 and seeking medical diagnosis;
4. the employee is caring for an individual who is subject to a federal, state, or local quarantine order, or the individual has been advised to self-quarantine due to concerns related to Covid-19;
5. the employee is caring for the employee’s son or daughter, if the child’s school or child care facility has been closed or the child’s care provider is unavailable due to Covid-19 precautions; or
6. the employee is experiencing any other substantially similar condition specified by Health and Human Services in consultation with the Department of the Treasury and the Department of Labor.

View in detail information provided by the Department of Labor:

---

Fact Sheets

The U.S. Department of Labor has resources to help workers and employers prepare for the COVID-19 virus (also known as novel coronavirus).

Wages, Hours and Leave
The Wage and Hour Division is providing information on common issues employers and workers face when responding to COVID-19, including the effects on wages and hours worked under the Fair Labor Standards Act and job-protected leave under the Family and Medical Leave Act.

Unemployment Insurance Flexibilities
NOTE:Check with your state’s unemployment insurance program regarding the rules in your state.

The Employment and Training Administration announced new guidance outlining state flexibilities in administering their unemployment insurance programs to assist Americans affected by the COVID-19 outbreak.

Under the guidance, federal law permits significant flexibility for states to amend their laws to provide unemployment insurance benefits in multiple scenarios related to COVID-19. For example, federal law allows states to pay benefits where:

• An employer temporarily ceases operations due to COVID-19, preventing employees from coming to work;
• An individual is quarantined with the expectation of returning to work after the quarantine is over; and
• An individual leaves employment due to a risk of exposure or infection or to care for a family member.

In addition, federal law does not require an employee to quit in order to receive benefits due to the impact of COVID-19.

Learn how to file for unemployment insurance benefits.

The IRS has established a special section focused on steps to help taxpayers, businesses and others affected by the coronavirus. This page will be updated as new information is available. Visit: https://www.irs.gov/coronavirus for more information about IRS related news.

• IR-2020-57, Treasury, IRS and Labor announce plan to implement Coronavirus-related paid leave for workers and tax credits for small and midsize businesses to swiftly recover the cost of providing Coronavirus-related leave
• Treasury News Release: Treasury and IRS Issue Guidance on Deferring Tax Payments Due to COVID-19 Outbreak
• IR-2020-54, IRS: High-deductible health plans can cover coronavirus costs

For businesses that find themselves having difficulty submitting collected taxes, visit with the Texas Comptroller’s Office they are offering assistance in the form of short-term payment agreements and, in most instances, waivers of penalties and interest. They ask that you contact our Enforcement Hotline at 800-252-8880 to learn about your options for remaining in compliance and avoiding interest and late fees on taxes due. In addition, they have a variety of online tools for businesses seeking assistance. See COVID-19 emergency response webpage for access to online tools, tutorials and other resources for tax services, and to establish 24/7 online account access with Webfile.

The following article showcases many tools and programs that can be utilized to convert to remote work situations.

Please contact an SBDC advisor if you need assistance accessing, installing, and utilizing any online tool.

Avoid COVID-19 scams!
Scammers are using the Small Business Administration’s (SBA) name to con small businesses and individuals during the COVID-19 crisis through phone calls, emails, text messages and letters.

Please note:

• If you are contacted by someone claiming to be from the SBA, suspect fraud.
• Emails from SBA or other legitimate government agencies will always end in .gov.
• There is no cost to apply for a COVID-19 Economic Injury Disaster Loan and SBA will never ask you to provide a credit card.
• Do not release any private information (social security number, date of birth, etc.) or banking information in response to an unsolicited caller, letter, email, or text.
• If you are in the process of applying for an SBA loan and receive email correspondence asking for PII, ensure that the referenced application number is consistent with your application number.
• An SBA logo on an email or webpage does not guarantee the information is accurate or from the SBA.
• Check for spelling and grammatical errors in an email and be wary of clicking on any links or attachments.
• For help with applying for an Economic Injury Disaster Loan, call 800-659-2955 or email disastercustomerservice@sba.gov. You can also use a text telephone (TTY) by calling 1-800-877-8339.
• For inquiries regarding support for small businesses, send an email to answerdesk@sba.gov
• Visit the Small Business Cybersecurity site to learn more about small Business Cybersecurity tips, common threats, training, and best practices.
• Visit the U.S. Department of Homeland Security’s Cyber Infrastructure site for small business resources.
• Trust your instincts! If something seems too good to be true, then it probably is too good to be true.
• Starting September of last year, there have been more than 200,000 complaints to the US Federal Trade Commission on scams related to COVID-19. Learn more about how to avoid these scams courtesy of the National Council for Safety, Protection and Wellness.

---

Below are some examples of the types of scams you should be on the lookout for:

1. Websites that appear to be from organizations such as Johns Hopkins University, CDC (Centers for Disease Control), or the WHO (World Health Organization). These malicious websites can infect users to steal banking, credit card, and personal sensitive information.
2. Emails that appear to be from organizations such as the CDC or the WHO. The scammers change emails to make them appear to come from these sources, but they actually contain malicious phishing links or dangerous attachments.
3. Emails that ask for charity donations for studies, doctors, or victims that have been affected by the COVD-19 Coronavirus. Scammers often create fake charity emails after global disasters or health scares.
4. Emails that claim to have a “new” or “updated” list of cases of Coronavirus in your area or new maps of infections. These emails could contain dangerous links and information designed to scare you into clicking on the link. We have also seen many examples of misinformation being spread via these methods as well, so keep checking your sources!
5. Emails and websites claiming to help you work remotely. There are scammers even creating software that sounds useful but has malicious intent behind it.

Remember to remain cautious! And always remember the following to protect yourself from scams using these methods:

• Never click on links or download attachments from an email that you weren’t expecting.
• If you receive a suspicious email that appears to come from an official organization such as the WHO or CDC, report the email to your IT department or provider
• If you want to make a charity donation, go to the charity website of your choice to submit your payment. Type the charity’s web address in your browser instead of clicking on any links in emails or other messages.

COVID Related Webinars

• On-Demand Webinars
• Upcoming Webinars

Please refer to the Center for Disease Control and Prevention website for up to date reports on COVID-19. Including a page dedicated to Guidance for businesses and employers.

The following handouts can be disseminated to employees and hung in the workplace:

• COVID-19 - Stop The Spread Of Germs At Work
• COVID-19 Fact Sheet
• Stop The Spread Of Germs At Work - SHRM Resource

President Biden signed the coronavirus relief package into law in March of 2021

 The full fact sheet can ve viewed here

The current public health crisis and resulting economic crisis have devastated the health and economic wellbeing of millions of Americans. From big cities to small towns, Americans – particularly people of color, immigrants, and low-wage workers – are facing a deep economic crisis. More than 9.5 million workers have lost their jobs in the wake of the pandemic, with 4 million out of work for half a year or longer.

The American Rescue Plan will change the course of the pandemic and deliver immediate and direct relief to families and workers impacted by the COVID-19 crisis through no fault of their own. This law is one of the most progressive pieces of legislation in history, and will build a bridge to an equitable economic recovery.

ECONOMIC IMPACT PAYMENTS

Through this third round of Economic Impact Payments, the U.S. Department of the Treasury (Treasury Department) and the Internal Revenue Service (IRS) are ensuring that Americans will receive fast and direct relief during the final phase of the COVID-19 crisis. As of yesterday, approximately 90 million Economic Impact Payments had been disbursed, thereby ensuring that more than $242 billion of much-needed relief will be received by millions of Americans and their families within days of enactment of the American Rescue Plan. Unlike the prior rounds of Economic Impact Payments, the American Rescue Plan requires a 2021 “true-up” additional payment, when applicable, based on information (such as a recently filed 2020 tax return) that the IRS receives mid-year during 2021. This additional Economic Impact Payment will ensure that Americans and their families receive greater amounts of financial assistance during 2021, rather than waiting to claim a Recovery Rebate Credit on a tax return in 2022.

Those eligible will automatically receive an Economic Impact Payment of up to $1,400 for individuals or

$2,800 for married couples, plus $1,400 for each dependent. Unlike the prior rounds of Economic Impact Payments, families will get a payment for all their dependents claimed on a tax return, not just their qualifying children under 17.

Normally, a taxpayer will qualify for the full amount if they have an adjusted gross income of up to

$75,000 for singles and married persons filing a separate return, up to $112,500 for heads of household, and up to $150,000 for married couples filing joint returns and surviving spouses. Payment amounts are reduced for filers with incomes above those levels.

The Treasury Department and the IRS continue to expand outreach to the millions of homeless, rural poor, and other disadvantaged Americans to ensure that they receive Economic Impact Payments. This includes new and continued relationships with homeless shelters, legal aid clinics, and providing Economic Impact Payment information in more than 35 languages.

CHILD TAX CREDIT

The American Rescue Plan’s expansion of the Child Tax Credit will substantially reduce child poverty by supplementing the earnings of families receiving the tax credit. Specifically, the Child Tax Credit has been revised in the following ways:

1. The credit amount has been increased. The American Rescue Plan increased the amount of the Child Tax Credit from $2,000 to $3,600 for children under age 6, and $3,000 for other children under age 18.
2. The credit’s scope has been expanded. Children 17 years old and younger, as opposed to 16 years old and younger, will now be covered by the Child Tax Credit.
3. Credit amounts will be made through advance payments during 2021. Individuals eligible for a 2021 Child Tax Credit will receive advance payments of the individual’s credit, which the IRS and the Bureau of the Fiscal Service will make through periodic payments from July 1, to December 31, 2021. This change will allow struggling families to receive financial assistance now, rather than waiting until the 2022 tax filing season to receive the Child Tax Credit benefit.
4. The credit is now fully refundable. By making the Child Tax Credit fully refundable, low- income households will be entitled to receive the full credit benefit, as significantly expanded and increased by the American Rescue Plan.
5. The credit is now extended to Puerto Rico and the U.S. Territories. For the first time, low- income families residing in Puerto Rico and the U.S. Territories will receive this vital financial assistance to better support their children’s development and health and educational attainment.

To facilitate the disbursement of Child Tax Credit advance payments during 2021, the American Rescue Plan requires the IRS to establish an online portal for taxpayers to update relevant data for mid-year payment adjustments (for example, the birth of a child during 2021). In addition to this online tool, the Treasury Department and the IRS will carry out a sweeping public awareness campaign parallel to its Economic Impact Payment campaign to reach all Americans who may be eligible for this financial assistance.

STATE AND LOCAL FISCAL RECOVERY FUND

State, local and tribal governments across America have been under an unprecedented strain in the wake of the COVID-19 crisis. While the need for services has increased —including setting up emergency medical facilities, standing up vaccination sites, and supporting struggling small businesses—state and local revenues have plummeted as a result of the economic fallout from the crisis. At the height of the fallout, public sector employment fell by around 1.4 million jobs, including layoffs of 1 million educators, compared to around 750,000 job losses during the Great Recession. As a result, communities have faced

untenable choices, between laying off educators, firefighters and other frontline workers or failing to provide services that communities rely on.

The American Rescue Plan provides $350 billion dollars in emergency funding for state, local, territorial, and Tribal governments to remedy this mismatch between rising costs and falling revenues. This includes:

• $195 billion for states, (a minimum of $500 million for each State);
• $130 billion for local governments (a minimum of $1.25 billion per state is provided by the statute inclusive of the amounts allocated to local governments within the state);
• $20 billion for tribal governments; and
• $4.5 billion for territories

The Rescue Plan will provide needed relief to state, local, and Tribal governments to enable them to continue to support the public health response and lay the foundation for a strong and equitable economic recovery. In addition to helping these governments address the revenue losses they have experienced as a result of the crisis, it will help them cover the costs incurred due responding to the public health emergency and provide support for a recovery – including through assistance to households, small businesses and nonprofits, aid to impacted industries, and support for essential workers. It will also provide resources for state, local, and Tribal governments to invest in infrastructure, including water, sewer, and broadband services.

CAPITAL PROJECTS FUND

The COVID-19 crisis starkly illuminated key shortcomings – and inequalities – in U.S. infrastructure. While some communities were able to adapt to the pandemic with remote or socially-distanced options for work, education, and health care, others lacked the infrastructure needed to do so, compounding the disruptions of the pandemic and exacerbating existing inequalities, with long-term consequences for American families. One particularly salient infrastructure challenge has been the digital divide and the absence of foundational conditions that enable network connectivity and access. As more and more areas of work and education move online, this divide risks leaving many American families behind.

Recognizing these challenges, the American Rescue Plan provides $10 billion for states, territories, and Tribes to cover the costs of capital projects like broadband infrastructure.

The Capital Projects Fund takes critical steps to addressing these challenges laid bare by the pandemic, especially in rural America and low- and moderate-income communities, helping to ensure that all communities have access to the high-quality, modern infrastructure needed to thrive, including internet access.

HOMEOWNER ASSISTANCE FUND

As the economic fallout from the COVID-19 crisis took form, millions of Americans were faced with the pressures of having to decide between making mortgage payments and other essential obligations. This was especially true for the low-income communities and communities of color who bore the brunt of this crisis. Across the country, one in 10 homeowners with a mortgage are behind on payments. The law takes immediate steps to help Americans stay in their homes and keep a roof over their heads.

The American Rescue Plan provides nearly $10 billion for states, territories, and Tribes to provide relief for our country’s most vulnerable homeowners. This includes:

• A minimum of $50 million for each state, the District of Columbia and Puerto Rico;
• $30 million for the territories of Guam, American Samoa, the United States Virgin Islands, and the Commonwealth of the Northern Mariana Islands;
• An explicit mandate to prioritize socially disadvantaged households;

The law prioritizes those homeowners that have experienced the greatest hardships, leveraging local and national income indicators to maximize intended impact. Applicable funding uses include delinquent mortgage payments, allowing Americans across the country to take a step in the right direction toward household stabilization. These necessary actions will minimize foreclosures in the coming months, alleviate emergency shelter capacity, and mitigate potential COVID-19 infections.

EMERGENCY RENTAL ASSISTANCE

An underlying consequence of the COVID-19 pandemic is that household stability is not just a financial security issue, but also a health concern. As the country entered the throes of the crisis, many cities and states began creating or expanding rental assistance programs to support at-risk households. The December appropriations bill provided $25 billion of federal relief to be administered by the Emergency Rental Assistance (ERA) program for disbursement to existing state and local government programs. The American Rescue Plan nearly doubles the initial funding to expand the reach and impact of the existing ERA program, taking additional steps to mitigate the financial harm caused by the pandemic and keeping Americans safe as the country addresses the virus.

The American Rescue Plan provides $21.6 billion for states, territories, and local governments to assist households that are unable to pay rent and utilities due to the COVID-19 crisis. This includes:

• A minimum of $152 million for each state and the District of Columbia;
• $305 million for the Commonwealth of Puerto Rico, the United States Virgin Islands, Guam, the Commonwealth of the Northern Mariana Islands, and American Samoa;
• $2.5 billion for payments to “high-need grantees,” locations with an urgent need for assistance when factoring conditions such as change in employment, concentration of very low-income renters, and rental market costs

As a result of the American Rescue Plan, states and localities across the country will be better armed to provide relief and assistance to those vulnerable households. The new funding will leverage existing program structures, allowing for money to be disbursed quickly and efficiently to on the ground emergency programs, and ensuring this country’s hardest-hit families to receive their equitable share of relief.

STATE SMALL BUSINESS CREDIT INITIATIVE

It is no secret that the pandemic has disproportionately impacted small businesses across the country, particularly those owned and operated by women and minorities. Every community has had to face the unfortunate reality of local storefronts that are closing or have closed, resulting in friends and family members being furloughed or laid off. Nationally, small business revenue is down 32 percent, and at least 400,000 firms have permanently closed. After a year of the public health crisis, many businesses are hanging on by a thread. Within this law are plans to provide critical assistance to small businesses across the country, facilitating the urgent deployment of capital and support to help these organizations not just persevere, but recover on solid footing.

The American Rescue Plan provides $10 billion to state and Tribal governments to fund small business credit expansion initiatives. This program will build off the inaugural model developed in 2011 during the Obama-Biden Administration, in which nearly $1.5 billion in capital supported over $8 billion in new lending and investing activity across 142 different programs in its first 5 years. The new iteration will expand in scale and include:

• $1.5 billion for states to support businesses owned by socially and economically disadvantaged people;
• $1 billion for an incentive program to boost funding tranches for states that show robust support for such businesses; and
• $500 million to support very small businesses with fewer than 10 employees;

This law will inject capital into state small business support and capital access programs, provide collateral support, facilitate loan participation, and enable credit guarantee programs. It will boost state venture capital programs and provide funding for technical support and assistance. This Administration recognizes that small businesses—enterprises that are responsible for two-thirds of net new jobs in this country—are the backbone of the American economy, and a bellwether of economic progress.

EMPLOYEE RETENTION CREDIT AND PAID LEAVE CREDIT PROGRAMS

In addition to the SSBCI, the American Rescue Plan extends a number of critical tax benefits to small businesses that are intended to help businesses through to the recovery while keeping up their payrolls and still taking steps to protect health outcomes for employees.

The American Rescue Plan extends the availability of the Employee Retention Credit for small businesses through December 2021 and allows businesses to offset their current payroll tax liabilities by up to

$7,000 per employee per quarter. This credit of up to $28,000 per employee for 2021 is available to small businesses who have seen their revenues decline, or even been temporarily shuttered, due to COVID.

The American Rescue Plan also extends through September 2021 the availability of Paid Leave Credits for small and midsize businesses that offer paid leave to employees who may take leave due to illness, quarantine, or caregiving. Businesses can take dollar-for-dollar tax credits equal to wages of up to

$5,000 if they offer paid leave to employees who are sick or quarantining. Paid Leave Credits are a powerful incentive to encourage the offer of paid sick and family leave, which will help keep the virus under control by ensuring sick employees can stay home.

UNEMPLOYMENT COMPENSATION

Across the nation, millions of Americans lost their jobs in the wake of the COVID-19 pandemic and, as a result, claimed unemployment benefits. The American Rescue Plan waives federal income taxes on the first $10,200 of unemployment benefits received in 2020 by middle- and lower-income taxpayers. The tax relief extends to both workers who received benefits through federal unemployment programs as well as those who received traditional benefits through their state unemployment insurance fund. This law will provide tax relief for Americans who lost their jobs and utilized unemployment benefits last year – allowing millions of workers to focus their benefits on covering essentials during the COVID-19 pandemic.