Making sense of the
Making Sense of the CARES ACT
Details Are Subject to Change: This is not legal or tax advice.
The Coronavirus Aid, Relief, and Economic Security also known as the "CARES" Act is a wide sweeping piece of legislation aimed at helping small businesses survive the COVID outbreak.
Forgivable Loans: Up to $10 Million dollars with the objective of keeping people on payroll
Emergency Grants: $10k Express Grants for businesses in jeopardy
Tax Incentives: A series of tax credit aimed at employee retention
Paid Leave: Already passed, Paid Family & Sick Leave that goes into effect April 1st
Paycheck Protection Program
So What Expenses are Covered?
Salary, wage, commission, cash tip or equivalent
Payment for vacation, parental, family, medical, or sick leave
Dismissal or separation pay
Health care or retirement benefits
State and local payroll taxes (currently exempt in some states)
Payments to independent contractors as sole proprietors
Who's Eligible & Details
Up to 500 employees
If a restaurant is multi-location, it's 500 per location
Sel-Employed, 501(c)3 and IC's
2 Year Term
$10M Max Loan
Can only use for covered expenses before 6/30/2020
How does forgiveness work?
Loans can be forgiven in total for expenditures made 8 weeks after loan origination on: Payroll, Mortgage Interest, Rent & Utilities.
1. After 8 weeks, you submit proof of expenditures and documentation to the lender.
2. Lender will then have 60 days to determine the appropriate level of forgiveness.
3. SBA purchases and forgives the relevant amount of the initial loan. The remaining portion of the loan is guaranteed by the SBA and has a 2 year maturity at 1.0% interest
4. Full-time equivalent or salary reductions will impact your forgiveness amount.
Okay, how do I participate?
Find a bank with a SBA 7(a) Program
● Ask the banker you currently work with if they are participating ● Get a detailed document list in case they want something additional
● Applications can start to be submitted on April 3rd, 2020
Contact us and we can apply for your loan of choice.
We will be helping people get all the necessary information needed to apply for the loan. Fees vary based on professional services needed: Casandra@collinsbookkeepingsolutions.com