Here’s our research on how Small Business & 1099’s Independent Contractors can get Government help, due to the CoronaVirus Shelter At Home Rules
The SBA will work directly with state Governors to provide targeted, low-interest loans to small businesses and non-profits that have been severely impacted by the Coronavirus (COVID-19). The SBA’s Economic Injury Disaster Loan program provides small businesses with working capital loans of up to $2 million that can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing.
$350 Billion allotted, hard to get a loan, money ran out LA Times 4.16.2020 * LA Times 4.16.2020 *
The SBA Debt Relief program will provide a reprieve to small businesses as they overcome the challenges created by this health crisis.
Under this program:
- The SBA will also pay the principal and interest of new 7(a) loans (FAQ’s from Senate Committee) issued prior to September 27, 2020.
- 7(a) program offers loan amounts up to $5,000,000 and is an all-inclusive loan program deployed by lending partners for eligible small businesses within the U.S. States and its territories.
- The uses of proceeds include:
- working capital;
- expansion/renovation;
- new construction;
- purchase of land or buildings;
- purchase of equipment,
- fixtures;
- lease-hold improvements;
- refinancing debt for compelling reasons;
- seasonal line of credit;
- inventory; or
- starting a business.
- Paycheck Protection
- The uses of proceeds include:
- 7(a) program offers loan amounts up to $5,000,000 and is an all-inclusive loan program deployed by lending partners for eligible small businesses within the U.S. States and its territories.
- The SBA will pay the principal and interest of current 7(a) loans for a period of six months.
SBA is here to assist small businesses with accessing federal resources and navigating their own preparedness plans as described by the CDC’s Guidance for Businesses and Employers.
Click here to apply on SBA’s Website
sba.gov/disaster-loan-applications
Find more information on the SBA’s Economic Injury Disaster Loans at: SBA.gov/Disaster.
How does Health Insurance cover Coronavirus?

Paycheck Protection Program
This loan program provides loan forgiveness for retaining employees by temporarily expanding the traditional SBA 7(a) loan program.

EIDL Loan Advance
This loan advance will provide up to $10,000 of economic relief to businesses that are currently experiencing temporary difficulties.

SBA Express Bridge Loans
Enables small businesses who currently have a business relationship with an SBA Express Lender to access up to $25,000 quickly.

SBA Debt Relief
The SBA is providing a financial reprieve to small businesses during the COVID-19 pandemic.
SMALL BUSINESS ADMINISTRATION (SBA} LOANS
The following is from an email my CPA Bruce Bialosky sent.
Many of our clients have expressed a high level of interest in this part of the CARES Act.
Check out these two links for more detail.
Due to the limits on funds available for this program, if you are interested I encourage you to apply for this as soon as possible. Following are the key parts as we understanding them today:
- These loans are referred to as Payroll Protection Program PPP Loans. The maximum amount of a loan is $10 million. That amount is limited by the amount of payroll with a somewhat complicated calculation. If you are involved in a loan, this part can be discussed, but the lender will review that with you.
- Wells Fargo
- Explanation from Entrepreneur.com
- Treasury.Gov Fact Sheet
- The total pool provided for these loans in CARES is $349 billion.
- The loan must be taken out between February 15, 2020, and June 30, 2020.
- They have a maximum period of ten years. Interest payments are deferred for a year.
- There is no prepayment penalty.
- The debt the business has elsewhere is not considered during this covered period.
- Collateral and personal guarantees are waived during this period.
- The allowable use of the funds is to meet payroll costs/covered employee benefits including commissions or similar compensation; operating costs such as rent, mortgage interest payments, utilities, interest on other debt incurred before February 15, 2020. (This is questionable how this could be enforced, but they are saying it is to be spent on your business — not a Hawaiian vacation).
- The interest rate can be no more than 4%.
- Eligible borrowers – Companies with 500 employees or less. There are exceptions for the following:
- Sole proprietors/independent contractors/self-employed persons;
- food service business concerns with more than 500 employees, but not more than 500 employees at one location.
- Borrowers must make good faith certification to lenders that a borrower needs funds to operate because of current economic disruption and will use funds for eligible uses.
- Lenders for this are ones that have worked with the SBA in the past. Most Banks have departments/personnel experienced with these loans. The loan process has been challenging in the past, but the Act streamlines the process and it will make it much easier.
- If you have a bank with which you currently work, they should be able to help you. If you need help with that, we have multiple sources to help in this regard.
- These loans are eligible for forgiveness §1105. Again, how this is calculated is somewhat complex, and we will not address that here. If you apply for a loan at that time, the lender will advise you on the rules to achieve forgiveness. Basically, you must show you are using the funds for eligible uses. Cancelled loans are not subject to taxation unlike most cancelled debt. Regulations regarding this are yet to be issued.
- The SBA may still issue some regulations regarding these loans, but they must do so within 15 days from March 27th – the date when the President signed the bill.
For anyone who may have a question on this matter, please contact Bruce Bialosky CPA or leave a question in our FAQ
SEC. 1102. 7(a) LOAN PROGRAM.
(a) Definition Of Covered Period.—In this section, the term “covered period” means the period beginning on March 1, 2020 and ending on December 31, 2020.
(b) Increased Eligibility For Certain Small Businesses And Organizations.—
(1) IN GENERAL.—During the covered period, any business concern, private nonprofit organization, or public nonprofit organization which employs not more than 500 employees shall be eligible to receive a loan made under section 7(a) of the Small Business Act (15 U.S.C. 636(a)), in addition to small business concerns.
(2) EXCLUSION OF NONPROFITS RECEIVING MEDICAID EXPENDITURES.—Paragraph (1) shall not apply to a nonprofit entity eligible for payment for items or services furnished under a State plan under title XIX of the Social Security Act (42 U.S.C. 1396 et seq.) or under a waiver of such plan.
(c) Maximum Loan Amount.—During the covered period, with respect to any loan guaranteed under section 7(a) of the Small Business Act (15 U.S.C. 636(a)) for which an application is approved or pending approval on or after the date of enactment of this Act, the maximum loan amount shall be the lesser of—
(1) the product obtained by multiplying—
(A) the average total monthly payments by the applicant for payroll, mortgage payments, rent payments, and payments on any other debt obligations incurred during the 1 year period before the date on which the loan is made, except that, in the case of an applicant that is seasonal employer, as determined by the Administrator, the average total monthly payments for payroll shall be for the period beginning March 1, 2019 and ending June 30, 2019; by
(B) 4; or
(2) $10,000,000.
(d) Allowable Uses Of Program Loans.—
(1) IN GENERAL.—During the covered period, a recipient of a loan made under section 7(a) of the Small Business Act (15 U.S.C. 636(a)) (including a recipient of assistance under the Community Advantage Pilot Program of the Administration) may, in addition to the allowable uses of such a loan, use the proceeds of the loan for—
(A) payroll support, including paid sick, medical, or family leave, and costs related to the continuation of group health care benefits during those periods of leave;
(B) employee salaries;
(C) mortgage payments;
(D) rent (including rent under a lease agreement);
(E) utilities; and
(F) any other debt obligations that were incurred before the covered period.
(A) IN GENERAL.—For purposes of making loans for the purposes described in paragraph (1), a lender under section 7(a) of the Small Business Act (15 U.S.C. 636(a)) shall be considered to have delegated authority to make and approve loans under such section 7(a) based on an evaluation of the eligibility of the borrower.
(B) CONSIDERATIONS.—In evaluating the eligibility of a borrower for a loan under section 7(a) of the Small Business Act (15 U.S.C. 636(a)) with the terms described in this subsection and subsection (c), a lender shall only consider whether the borrower—
(i) was in operation on March 1, 2020; and
(ii) had employees for whom the borrower paid salaries and payroll taxes.
(3) LIMITATION.—A borrower that receives assistance under section 7(b)(2) of the Small Business Act (15 U.S.C. 636(b)(2)) related to COVID–19 for purposes of paying payroll and providing payroll support shall not be eligible for a loan described in paragraph (1) for the same purpose.
(e) Fee Waiver For 7(A) Loans.—During the covered period, with respect to each loan guaranteed under section 7(a) of the Small Business Act (15 U.S.C. 636(a))—
(1) in lieu of the fee otherwise applicable under section 7(a)(23)(A) of the Small Business Act (15 U.S.C. 636(a)(23)(A)), the Administrator shall collect no fee or reduce fees to the maximum extent possible; and
(2) for which the application is approved on or after the date of enactment of this Act, the Administrator shall, in lieu of the fee otherwise applicable under section 7(a)(18)(A) of the Small Business Act (15 U.S.C. 636(a)(18)(A)), collect no fee or reduce fees to the maximum extent possible.
(f) Guarantee Amount For 7(A) Loans.—
(1) IN GENERAL.—Section 7(a)(2)(A) of the Small Business Act (15 U.S.C. 636(a)(2)(A)) is amended by striking “equal to—” and all that follows through the end of the subparagraph and inserting “equal to 100 percent of the balance of the financing outstanding at the time of disbursement of the loan.”.
(2) PROSPECTIVE REPEAL.—Effective on January 1, 2021, section 7(a)(2)(A) of the Small Business Act (15 U.S.C. 636(a)(2)(A)) is amended by striking “equal to 100 percent of the balance of financing outstanding at the time of disbursement of the loan” and inserting “equal to—
“(i) 75 percent of the balance of the financing outstanding at the time of disbursement of the loan, if such balance exceeds $150,000; or
“(ii) 85 percent of the balance of the financing outstanding at the time of disbursement of the loan, if such balance is less than or equal to $150,000.”.
(ii) an organization made eligible by subsection (b) of this section for a loan under section 7(a) of the Small Business Act (15 U.S.C. 636(a)).
(i) IN GENERAL.—In this subsection, the term “impacted borrower” means an eligible borrower that—
(I) is in operation on March 1, 2020; and
(II) has an application for a loan made under section 7(a) of the Small Business Act (15 U.S.C. 636(a)) that is approved or pending approval on or after the date of enactment of this Act.
(ii) PRESUMPTION.—For purposes of this subsection, an impacted borrower is presumed to have been adversely impacted by COVID–19.
(2) DEFERRAL.—During the covered period, the Administrator shall—
(A) consider each eligible borrower that applies for a loan under section 7(a) of the Small Business Act (15 U.S.C. 636(a)) to be an impacted borrower; and
(B) require lenders under such section 7(a) to provide complete payment deferment relief for impacted borrowers with loans guaranteed under such section 7(a) for a period of not more than 1 year.
(3) SECONDARY MARKET.—During the covered period, with respect to a loan made under 7(a) of the Small Business Act (15 U.S.C. 636(a)) that is sold on the secondary market, if an investor declines to approve a deferral requested by a lender under paragraph (2), the Administrator shall exercise the authority to purchase the loan so that the impacted borrower may receive a deferral for a period of not more than 1 year.
(4) GUIDANCE.—Not later than 30 days after the date of enactment of this Act, the Administrator shall provide guidance to lenders under section 7(a) of the Small Business Act (15 U.S.C. 636(a)) on the deferment process described in this subsection.
(h) Commitments For 7(A) Loans.—During the covered period—
(1) there shall be no limitation on the commitments for general business loans authorized under section 7(a) of the Small Business Act (15 U.S.C. 636(a)); and
(2) the amount authorized for commitments for such loans under the heading “BUSINESS LOANS PROGRAM ACCOUNT” under the heading “Small Business Administration” under title V of the Consolidated Appropriations Act, 2020 (Public Law 116–93; 133 Stat. 2475) shall not apply.
(1) IN GENERAL.—Section 7(a)(31)(D) of the Small Business Act (15 U.S.C. 636(a)(31)(D)) is amended by striking “$350,000” and inserting “$1,000,000”.
(2) PROSPECTIVE REPEAL.—Effective on January 1, 2021, section 7(a)(31)(D) of the Small Business Act (15 U.S.C. 636(a)(31)(D)) is amended by striking “$1,000,000” and inserting “$350,000”.
SEC. 1105.
LOAN FORGIVENESS
(a) Definitions.—In this section—
(1) the term “covered 7(a) loan” means a loan guaranteed under section 7(a) of the Small Business Act (15 U.S.C. 636(a)) that is made during the covered period;
(2) the term “covered period” means the period beginning on March 1, 2020 and ending on June 30, 2020;
(3) the term “eligible recipient” means the recipient of a covered 7(a) loan; and
(4) the term “payroll costs” shall not include—
(A) the compensation of an individual employee in excess of $33,333 during the covered period;
(B) qualified sick leave wages for which a credit is allowed under section 7001 of the Families First Coronavirus Response Act; or
(C) qualified family leave wages for which a credit is allowed under section 7003 of the Families First Coronavirus Response Act.
(b) Forgiveness.—An eligible recipient shall be eligible for forgiveness of indebtedness on a covered 7(a) loan in an amount equal to the cost of maintaining payroll continuity during the covered period.
(c) Treatment Of Amounts Forgiven.—
(1) IN GENERAL.—Amounts which have been forgiven under this section shall be considered canceled indebtedness by lenders authorized under section 7(a) of the Small Business Act (15 U.S.C. 636(a)).
(2) FOR PURPOSES OF REDEMPTION OF GUARANTEES.—For purposes of the redemption of a guarantee by the lender for a covered 7(a) loan, amounts which are forgiven under this section shall be treated as a default, in accordance with the procedures that are otherwise applicable to a default on a loan guaranteed under section 7(a) of the Small Business Act (15 U.S.C. 636(a)).
(d) Limits On Amount Of Forgiveness.—
(1) IN GENERAL.—The amount of loan forgiveness under this section for an eligible recipient shall not exceed the sum of—
(A) the total payroll costs (Interim Guidance) incurred by the eligible recipient during the covered period; and
- compensation to employees (whose principal place of residence is the United States) in the form of salary, wages, commissions, or similar compensation;
- cash tips or the equivalent (based on employer records of past tips or, in the absence of such records, a reasonable, good-faith employer estimate of such tips);
- payment for vacation,
- parental, family, medical, or sick leave;
- allowance for separation or dismissal;
- payment for the provision of employee benefits consisting of group health care coverage, including insurance premiums, and retirement;
- payment of state and local taxes assessed on compensation of employees; and for
- an independent contractor or sole proprietor, wage, commissions, income, or net earnings from self-employment or similar compensation. Forbes * (Interim Guidance)
- See above a 1 4 for what is not a payroll cost
(B) the amount of payments made during the covered period on debt obligations that were incurred before the covered period.
(2) REDUCTION BASED ON REDUCTION IN NUMBER OF EMPLOYEES.—
(A) IN GENERAL.—The amount of loan forgiveness under this section shall be reduced by the percentage equal to the difference obtained by subtracting—
(i) the quotient obtained by dividing—
(I) the average number of full-time equivalent employees per month employed by the eligible recipient during the covered period; by
(aa) the average number of full time equivalent employees (FTE Calculator) per month employed by the eligible recipient during the period beginning on March 1, 2019 and ending on June 30, 2019; or
(bb) in the case of an eligible recipient that is seasonal employer, as determined by the Administrator, the average number of full-time equivalent employees per month employed by the eligible recipient during the period beginning on March 1, 2019 and ending on June 30, 2019; from
(ii) 1.
(B) CALCULATION OF AVERAGE NUMBER OF EMPLOYEES.—The average number of full-time equivalent employees shall be determined by calculating the average number of employees for each pay period falling within a month.
(3) REDUCTION RELATING TO COMPENSATION.—The amount of loan forgiveness under this section shall also be reduced by the amount of any reduction in excess of 25 percent of compensation in the most recent full quarter in which the employee was paid in compensation during the covered period of any employee who was compensated—
(A) in an amount less than $33,333 during the period beginning on March 1, 2019 and ending on June 30, 2019; or
(B) not more than $100,000 on annualized basis during 2019.
(4) EXCEPTION FOR TIPPED WORKERS.—An eligible recipient with tipped employees described in section 3(m)(2)(A) of the Fair Labor Standards Act of 1938 (29 U.S.C. 203(m)(2)(A)) may receive forgiveness for additional wages paid to those employees.
(e) Application.—An eligible recipient seeking loan forgiveness under this section shall submit to the lender that originated the covered 7(a) loan an application, which shall include documentation verifying the number of full-time equivalent employees (calculator) on payroll and pay rates for the periods described in subsection (d), including—
(1) payroll tax filings reported to the Internal Revenue Service;
(2) State income, payroll, and unemployment insurance filings;
(3) financial statements verifying payment on debt obligations incurred before the covered period; and
(4) any other documentation the Administrator determines necessary.
Wells Fargo Website on SBA Loans
(f) Certification.—An eligible recipient receiving loan forgiveness under this section shall make a good faith certification that the uncertainty of current economic conditions justifies the loan request to support the ongoing operations of the borrower, and acknowledges that funds will be used to retain workers and maintain payroll.
(g) Prohibition On Forgiveness Without Documentation.—No eligible recipient shall receive forgiveness under this section without submitting to the lender that originated the covered 7(a) loan the documentation required under subsection (e).
(h) Decision.—Not later than 15 days after the date on which a lender receives an application for loan forgiveness under this section from an eligible recipient, the lender shall issue a decision on the an application.
(i) Taxability.—Canceled indebtedness under this section shall be excluded from gross income for purposes of the Internal Revenue Code of 1986.
(j) Rule Of Construction.—The cancellation of indebtedness on a covered 7(a) loan under this section shall not otherwise modify the terms and conditions of the covered 7(a) loan.
(k) Regulations.—Not later than 30 days after the date of enactment of this Act, the Administrator shall issue guidance and regulations implementing this section.
Sec. 1101. Definitions.
Sec. 1102. 7(a) loan program.
Sec. 1103. Entrepreneurial development.
Sec. 1104. Waiver of matching funds requirement under the women’s business center program.
Sec. 1105. Loan forgiveness.
Sec. 1106. Direct appropriations.
Sec. 1107. Minority business development agency.
Sec. 1108. Waiver of prepayment penalty.
Sec. 1109. United States Treasury Program Management Authority.
In this division—
(1) the terms “Administration” and “Administrator” mean the Small Business Administration and the Administrator thereof; and
(2) the term “small business concern” has the meaning given the term in section 3 of the Small Business Act (15 U.S.C. 632).
(a) Definitions.—In this section—
(1) the term “covered small business concern” means a small business concern that is located in an area that is substantially affected by the COVID–19;
(B) a women’s business center;
(3) the term “small business development center” has the meaning given the term in section 3 of the Small Business Act (15 U.S.C. 632);
(4) the term “substantially affected by COVID–19” means, with respect to a covered small business concern, that the covered small business concern has experienced—
(A) supply chain disruptions, including changes in—
(i) quantity and lead time, including the number of shipments of components and delays in shipments;
(ii) quality, including shortages in supply for quality control reasons; and
(iii) technology, including a compromised payment network;
(B) staffing challenges;
(C) a decrease in sales or customers; or
(D) shuttered businesses; and
(5) the term “women’s business center” means a women’s business center described in section 29 of the Small Business Act (15 U.S.C. 656).
(b) Education, Training, And Advising Grants.—
(1) IN GENERAL.—The Administration may provide financial assistance in the form of grants to resource partners to provide education, training, and advising to covered small business concerns.
(2) USE OF FUNDS.—Grants under this subsection shall be used for the education, training, and advising of covered small business concerns and their employees on—
(A) accessing and applying for resources provided by the Administration and other Federal resources relating to access to capital and business resiliency;
(B) the hazards and prevention of the transmission and communication of COVID–19 and other communicable diseases;
(C) the potential effects of COVID–19 on the supply chains, distribution, and sale of products of covered small business concerns and the mitigation of those effects;
(D) the management and practice of telework to reduce possible transmission of COVID–19;
(E) the management and practice of remote customer service by electronic or other means;
(F) the risks of and mitigation of cyber threats in remote customer service or telework practices;
(G) the mitigation of the effects of reduced travel or outside activities on covered small business concerns during COVID–19 or similar occurrences; and
(H) any other relevant business practices necessary to mitigate the economic effects of COVID–19 or similar occurrences.
(A) SMALL BUSINESS DEVELOPMENT CENTERS.—The Administration shall award 80 percent of funds authorized to carry out this subsection to small business development centers, which shall be awarded pursuant to a formula jointly developed, negotiated, and agreed upon, with full participation of both parties, between the association formed under section 21(a)(3)(A) of the Small Business Act (15 U.S.C. 648(a)(3)(A)) and the Administration.
(B) WOMEN’S BUSINESS CENTERS.—The Administration shall award 20 percent of funds authorized to carry out this subsection to women’s business centers, which shall be awarded pursuant to a process established by the Administration in consultation with recipients of assistance.
(C) NO MATCHING FUNDS REQUIRED.—Matching funds shall not be required for any grant under this subsection.
(A) IN GENERAL.—Goals and metrics for the funds made available under this subsection shall be jointly developed, negotiated, and agreed upon, with full participation of both parties, between the resource partners and the Administrator, which shall—
(i) take into consideration the extent of the circumstances relating to the spread of COVID–19, or similar occurrences, that affect covered small business concerns located in the areas covered by the resource partner, particularly in rural areas or economically distressed areas;
(ii) generally follow the use of funds outlined in paragraph (2), but shall not restrict the activities of resource partners in responding to unique situations; and
(iii) encourage resource partners to develop and provide services to covered small business concerns.
(B) PUBLIC AVAILABILITY.—The Administrator shall make publicly available the methodology by which the Administrator and resource partners jointly develop the metrics and goals described in subparagraph (A).
(c) Resource Partner Association Grants.—
(1) IN GENERAL.—The Administrator may provide grants to an association or associations representing resource partners to establish a centralized hub for COVID–19 information, which shall include—
(A) an online platform that consolidates resources and information available across multiple Federal agencies for small business concerns related to COVID–19; and
(B) a training program to educate resource partner counselors on the resources and information described in subparagraph (A).
(2) GOALS AND METRICS.—Goals and metrics for the funds made available under this subsection shall be jointly developed, negotiated, and agreed upon, with full participation of both parties, between the association or associations receiving a grant under this subsection and the Administrator.
(d) Report.—Not later than 6 months after the date of enactment of this Act, and annually thereafter, the Administrator shall submit to the Committee on Small Business and Entrepreneurship of the Senate and the Committee on Small Business of the House of Representatives a report—
(1) that describes, with respect to the initial year covered by the report—
(A) the programs and services developed and provided by the Administration and resource partners under subsection (b);
(B) the initial efforts to provide those services under subsection (b); and
(C) the online platform and training developed and provided by the Administration and the association or associations under subsection (c); and
(2) that describes, with respect to the subsequent years covered by the report—
(A) with respect to the grant program under subsection (b)—
(i) the efforts of the Administrator and resource partners to develop services to assist covered small business concerns;
(ii) the challenges faced by owners of covered small business concerns in accessing services provided by the Administration and resource partners;
(iii) the number of unique covered small business concerns that were served by the Administration and resource partners; and
(iv) other relevant outcome performance data with respect to covered small business concerns, including the number of employees affected, the effect on sales, the disruptions of supply chains, and the efforts made by the Administration and resource partners to mitigate these effects; and
(B) with respect to the grant program under subsection (c)—
(i) the efforts of the Administrator and the association or associations to develop and evolve an online resource for small business concerns; and
(ii) the efforts of the Administrator and the association or associations to develop a training program for resource partner counselors, including the number of counselors trained.
During the 3-month period beginning on the date of enactment of this Act, the requirement relating to obtaining cash contributions from non-Federal sources under section 29(c)(1) of the Small Business Act (15 U.S.C. 656(c)(1)) is waived for any recipient of assistance under such section 29.
(a) In General.—There is appropriated, out of amounts in the Treasury not otherwise appropriated, for the fiscal year ending September 30, 2020, to remain available until September 30, 2021, for additional amounts—
(1) $299,400,000,000 under the heading “Small Business Administration—Business Loans Program Account” for the cost of guaranteed loans as authorized under section 7(a) of the Small Business Act (15 U.S.C. 636(a));
(2) $300,000,000 under the heading “Small Business Administration—Salaries and Expenses” for salaries and expenses of the Administration;
(3) $25,000,000 under the heading “Small Business Administration—Office of Inspector General” for necessary expenses of the Office of Inspector General of the Administration in carrying out the provisions of the Inspector General Act of 1978 (5 U.S.C. App.);
(4) $265,000,000 under the heading “Small Business Administration—Entrepreneurial Development Programs”, of which—
(A) $240,000,000 shall be for carrying section 1103(b) of this Act; and
(B) $25,000,000 shall be for carrying out section 1103(c) of this Act; and
(5) $10,000,000 under the heading “Department of Commerce—Minority Business Development Agency” for minority business centers of the Minority Business Development Agency to provide technical assistance to small business concerns.
(b) Reports.—Not later than 180 days after the date of enactment of this Act, the Administrator shall submit to the Committee on Appropriations of the Senate and the Committee on Appropriations of the House of Representatives a detailed expenditure plan for using the amounts appropriated under subsection (a).
(a) Definitions.—In this section—
(1) the term “Agency” means the Minority Business Development Agency of the Department of Commerce;
(2) the term “covered small business concern” means a small business concern (as defined in section 3 of the Small Business Act (15 U.S.C. 632) that is located in an area that is substantially affected by the COVID–19;
(3) the term “minority business center” means a Business Center of the Agency; and
(4) the term “substantially affected by COVID–19” means, with respect to a covered small business concern, that the covered small business concern has experienced—
(A) supply chain disruptions, including changes in—
(i) quantity and lead time, including the number of shipments of components and delays in shipments;
(ii) quality, including shortages in supply for quality control reasons; and
(iii) technology, including a compromised payment network;
(B) staffing challenges;
(C) a decrease in sales or customers; or
(D) shuttered businesses.
(b) Education, Training, And Advising Grants.—
(1) IN GENERAL.—The Agency may provide financial assistance in the form of grants to minority business centers to provide education, training, and advising to covered small business concerns.
(2) USE OF FUNDS.—Grants under this section shall be used for the education, training, and advising of covered small business concerns and their employees on—
(A) accessing and applying for resources provided by the Agency and other Federal resources relating to access to capital and business resiliency;
(B) the hazards and prevention of the transmission and communication of COVID–19 and other communicable diseases;
(C) the potential effects of COVID–19 on the supply chains, distribution, and sale of products of covered small business concerns and the mitigation of those effects;
(D) the management and practice of telework to reduce possible transmission of COVID–19;
(E) the management and practice of remote customer service by electronic or other means;
(F) the risks of and mitigation of cyber threats in remote customer service or telework practices;
(G) the mitigation of the effects of reduced travel or outside activities on covered small business concerns during COVID–19 or similar occurrences; and
(H) any other relevant business practices necessary to mitigate the economic effects of COVID–19 or similar occurrences.
(3) NO MATCHING FUNDS REQUIRED.—Matching funds shall not be required for any grant under this section.
(A) IN GENERAL.—Goals and metrics for the funds made available under this section shall be jointly developed, negotiated, and agreed upon, with full participation of both parties, between the minority business centers and the Agency, which shall—
(i) take into consideration the extent of the circumstances relating to the spread of COVID–19, or similar occurrences, that affect covered small business concerns located in the areas covered by the minority business centers, particularly in rural areas or economically distressed areas;
(ii) generally follow the use of funds outlined in paragraph (2), but shall not restrict the activities of minority business centers in responding to unique situations; and
(iii) encourage minority business centers to develop and provide services to covered small business concerns.
(B) PUBLIC AVAILABILITY.—The Agency shall make publicly available the methodology by which the Agency and minority business centers jointly develop the metrics and goals described in subparagraph (A).
(5) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated $10,000,000 to carry out this section, to remain available until expended.
Notwithstanding any other provision of law, for a loan made under the authority under this division or an amendment made by this division, there shall be no prepayment penalty for any payment on the loan made on or before December 31, 2020.
(a) Authority To Include Additional Financial Institutions.—The Department of the Treasury, in consultation with the Administration and the other Federal financial regulatory agencies (as defined in section 313(r) of title 31, United States Code), shall establish criteria for insured depository institutions (as defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813)) and other specialized lenders, that do not already participate in lending under programs of the Administration, to participate in a small business interruption loans program to provide loans under section 7(a) of the Small Business Act (15 U.S.C. 636(a)) in accordance with this section until the date on which the national emergency declared by the President under the National Emergencies Act (50 U.S.C. 1601 et seq.) with respect to the Coronavirus Disease 2019 (COVID–19) expires.
(b) Criteria.—Due to exigent circumstances, the eligibility criteria that would otherwise be applicable a loan made under section 7(a) of the Small Business Act (15 U.S.C. 636(a)) shall not apply to a loan made under this section.
(c) Safety And Soundness.—An insured depository institution (as defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813)) or other specialized lender may only participate in the program established under this section if participation does not affect the safety and soundness of the institution or lender.
(d) Additional Regulations.—The Secretary of the Treasury, in consultation with the Administrator, shall issue regulations and guidance in order to direct additional lenders under this section and establish additional terms that set out compensation, underwriting standards, interest rates, maturity, and other relevant terms and conditions.
(e) Program Administration.—Under the infrastructure of the Department of the Treasury and with guidance from the Secretary of the Treasury, the Administration shall administer the program established under this section until the date on which the national emergency declared by the President under the National Emergencies Act (50 U.S.C. 1601 et seq.) with respect to the Coronavirus Disease 2019 (COVID–19) expires.
Corona Virus
Links & References
to our web pages
Enforcement – Participation – Recertification – Actively @ Work
Corona Virus – How does Insurance Cover it?
SBA CoronaVirus Loans
SDI State Disability Insurance
warner pacific.com/Resources
S 3548 CARES Act on Congress.Gov
Medicare Eligible – Lay off from Employer Plan?
Child Pages
Chamber of Commerce
Short 4 page explanation
Our webpage on Coronavirus loans
Paycheck Protection PPP Loan Forgiveness! vs SBA Economic Injury Disaster Loan EIDL
- FAQ's from Senate Committee
Small Biz Owner Guide to the Cares Act
Our webpage on the CARES act
How Insurance covers COVID 19
Summary
- FAQ's o PPP Loans from Senate Committee
White Paper on Helping Small Biz Clients Plan in COVID 19 ERA - from the American College of Financial Services
Our Webpage on Insurance Coverage for
COVID 19
Graphic from The Sun.UK
Health Coverage Guide.org 
What Is Group Coverage?
Is Insurance Required?
Is Your Business Eligible for Group Coverage?
Who Is Eligible for Coverage?
What Do Employers Have to Pay?
What do you and your employees value in a Health Plan?
My CPA’s Newsletter
Let’s address the tax issue: You may know the IRS ruled that if your PPP loan is forgiven you cannot deduct the related expenditures. This new Congressional bill overrules that and makes all the expenses deductible for anyone with a PPP loan. That is a big deal. Unfortunately, the State of California will not allow deduction of the expenses.
A Major Concern:
For people who own a partnership, LLC or S Corporation if you received a PPP Loan you must have basis to write off the expenses. IRS basis rules may prevent a current write off of expenses paid with PPP loan proceeds. This results from the fact that the basis increase for forgiveness of PPP loan proceeds does not occur until the loan is actually forgiven. For some borrowers that will be 2021. It may be advisable for a partner or a shareholder to contribute an amount equal to their PPP loan funds to their partnership, LLC or S Corporation before December 31, 2020 if basis is an issue.
In addition:
Second, more excellent news. As predicted previously, all loans under $150,000 will automatically be forgiven with the completion of a one-page certification of expenditures. Life just got easier for the vast majority of people with PPP loans. Go ahead and contact your lender and tell them you want to process forgiveness under the new guideline.
Third, even more excellent news: Those $10,000 EIDL loans which everyone was questioning as to how they are being handled. They have been turned into grants thus the income loan is relieved and you do not have to do a thing. They do not have to reduce your PPP loan forgiveness.
If your loan is above $150,000 there is no reason to wait to submit your application if your lender is accepting applications. If you need help with that, please contact me. There are some additional expense categories that can be used for forgiveness. Please contact me if you want to understand those.
If you want to participate in the new round of PPP loans there are two groups.
The first group is those who received loans in the last round:
1. If you have previously had a PPP loan you can get one if you have less than 300 employees.
2. You have to show that you had a drop in income of 25% in 2020 from 2019 in any one quarter. That income drop does not include your prior PPP loan.
The second group is someone who has never filed for a PPP Loan:
That is for those who have not received a loan previously. The new rules are much like the old rules with a $2 million cap on the loans and the maximum 300 employees. You will be able to choose either an 8-week or 24-week period for your calculating your expenses.
Loan applications will open up for both groups sometime next year. It appears applications will need to be done in the first three months of 2021. Contact your Lender.
Please contact me with any questions.
Your Devoted CPA
What about collecting under business interruption coverage?
business interruption coverage generally allows a business to recover certain losses in the event that the business suffers physical damage or loss that prevents it from operating its business, whereas civil authority coverage, generally allows a business to recover losses when it a civil authority issues an order that closes a business or prevents it from normal operations.
Does the policy expressly excluded coverage for viral contamination. communicable disease?
some state legislators, including lawmakers in New Jersey, New York, Ohio, Louisiana and Pennsylvania, have proposed legislation that would require insurers to provide some coverage for losses stemming from COVID-19.
Contracts Clause of the U.S. Constitution, which, with some exceptions, generally prohibits states from enacting legislation that impairs contractual obligations.
Our webpage on contracts & plain meaning rule
Our webpage on Health Reform Mandate Penalty and Commerce Clause, etc.
Insurance policies are contracts and thus, are interpreted as such. Accordingly, a business whose policy expressly covers viral contamination or a pandemic is more likely to succeed on a claim for coverage than a business whose policy expressly excludes coverage for viruses. National Law Review
More money just approved to be poured into the SBA loan program
https://www.latimes.com/business/story/2020-04-24/coronavirus-small-business-relief-program-restarts-monday
I’m self employed – sole proprietor – I don’t have payroll – what do I show to get a loan?
How do I figure out the loss I expect for my business to drop because of coronavirus?
If you are an independent contractor, sole proprietor, or self-employed individual, lenders will also be looking for certain documents (final requirements will be announced by the government) such as payroll tax filings, Forms 1099-MISC, and income and expenses from the sole proprietorship Schedule C 1099 Income
2. For Sole Proprietors, Independent Contractors, and Self-Employed Individuals:
The sum of payments of any compensation to or income of a sole proprietor or independent contractor that is a wage, commission, income, net earnings from self-employment, or similar compensation and that is in an amount that is not more than $100,000 in one year, as pro-rated for the covered period.
Small Biz Guide & Checklist
Interim Guidance
16. What is the maximum amount you can borrow?
If you are an independent contractor or sole proprietor (self-employed):
Step 1: Aggregate “payroll costs” from the last 12 months (e.g., calendar year 2019, March 2019 to March 2020). For what constitutes “payroll costs,” see Question 17 below.
Step 2: To the extent not already taken into account when calculating Step 1, make sure that the annualized wage, commissions, income, or net earnings paid to yourself is capped at $100,000. Subtract any amounts paid to you as an independent contractor or sole proprietor in excess of $100,000.
Step 3: Divide by 12 to calculate the average monthly payroll costs.
Step 4: Multiply by 2.5.
Step 5: If you have any outstanding amount of an Economic Injury Disaster Loan (“EIDL”), which you received between January 31, 2020 and April 3, 2020, add the outstanding amount, less the amount of any “advance” under an EIDL COVID-19 loan.
17. What costs are included in payroll costs?
For businesses: “Payroll costs” consist of any compensation to employees (whose principal place of residence is in the U.S.) in the form of:
For an independent contractor or sole proprietor: “Payroll costs” consist of wage, commissions, income, or net earnings from self-employment or similar compensation.
Moreover, the CARES Act expressly excludes from the definition of “payroll costs”
(i) any compensation to an employee whose principal place of residence is outside of the United States,
(ii) qualified sick and family leave wages for which a credit is allowed under the Families First Coronavirus Response Act, and
(iii) federal employment taxes imposed or withheld between February 15, 2020 and June 30, 2020, including the employee’s and employer’s share of Federal Insurance Contributions Act and Railroad Retirement Act taxes and income taxes required to be withheld from employees. Paul Hastings
VIDEO on reading profit & loss statements
As you analyze your P & L —- Maybe you can find ways to still work or even find a niche to open up new markets. If you’re a Gym or P.E. instructor check this out.
https://bestlifeonline.com/things-to-do-by-yourself/
6. Jump into online workout classes.
Online workout classes are the perfect solution to being shut out of your local gym or studio. There are many online class options including ballet, yoga, boxing, and, lest we forget, those retro Jane Fonda workouts. This is the time to try something new in the safety of your home or perfect a technique you’ve been working on for months so you don’t lose your progress. Move your furniture, blast some music, and break a sweat, because endorphins make you happy.
What do I need to certify? As part of your application, you need to certify in good faith that:
Current economic uncertainty makes the loan necessary to support your ongoing operations.
The funds will be used to retain workers and maintain payroll or to make mortgage, lease, and utility payments.
You have not and will not receive another loan under this program.
You will provide to the lender documentation that verifies the number of full-time equivalent employees on payroll and the dollar amounts of payroll costs, covered mortgage interest payments, covered rent payments, and covered utilities for the eight weeks after getting this loan.
Loan forgiveness will be provided for the sum of documented payroll costs, covered mortgage interest payments, covered rent payments, and covered utilities. Due to likely high subscription, it is anticipated that not more than 25% of the forgiven amount may be for non-payroll costs.
All the information you provided in your application and in all supporting documents and forms is true and accurate. Knowingly making a false statement to get a loan under this program is punishable by law.
You acknowledge that the lender will calculate the eligible loan amount using the tax documents you submitted. You affirm that the tax documents are identical to those you submitted to the IRS. And you also understand, acknowledge, and agree that the lender can share the tax information with the SBA’s authorized representatives, including authorized representatives of the SBA Office of Inspector General, for the purpose of compliance with SBA Loan Program Requirements and all SBA reviews. https://www.sba.com/funding-a-business/government-small-business-loans/ppp/1099-independent-contractors/
Get Started on loan
https://1099.sba.com/
VIDEO explaining PPP loans
Wells Fargo Website on PPP Loans
How to show a loss on Schedule C
Lost Income for Cash Basis
You may or may not need to list lost business income on your Schedule C. If you operate your business on a cash basis, which most proprietors do, there’s no need to list lost income. You can simply deduct the costs associated with providing the goods and services. If your business doesn’t receive cash it’s owed, there’s no income to report on Schedule C; you can report the income when you receive it. Small Biz Chron
Business Interruption Jones Walker.com
Here’s how to calculate how much business interruption insurance you need:
Calculate your business’s projected income.
Estimate your business’s annual income for the coming year, and divide your estimate by 12 to get projected monthly income.
Calculate how long it would take to get your business running again. This is called the period of restoration. For instance, if your business was completely destroyed, you would have to call an insurance adjuster and appraiser to appraise the losses, an architect to design a new building, and a contractor to construct a new building. You might have to relocate while you wait for the new building to be ready. This period of restoration could take several months, depending on the size of your business.
Calculate lost income and operating expenses during the period of restoration. Since you know your monthly income, add up how much income you’d lose during the period of restoration. You should also write down your monthly expenses for that time period, such as employee wages, loan and rent payments, and taxes.
Keep in mind that the amount of money you’ll receive from the insurance company for each claim is based on records of your business income and expenses, so you should have an effective business accounting software or system.
According to Cate Steane, founder of Make It Happen Preparedness Services, “Having a BII policy is useful only if you have current, accurate documentation of your business revenues and expenses.
Having a good bookkeeper and having your financial records on the cloud is critical to successful pursuit of business interruption claims.” If there are disagreements about the amount of loss you experienced, the insurance company will call in an appraiser. fundera.com
Calculating Your Business Interruption Loss
Add Net Sales Projected
Less Cost of Goods Sold (COGS)
Equals Gross Profit
Less Selling, General and Administrative (SG&A) or Operating Expenses (OpEx)
Less Interest and Taxes
Equals Net Income
Add Continuing Expenses and Adjustments
Equals Total Estimated Business Interruption Amount uphelp.org
Here is a sample list of documents typically requested by the insurance company:
Monthly Profit and Loss Statements
Monthly and Daily Production Reports
Monthly Inventory
Monthly Cost Accounting Reports
Invoices and Purchase Orders irmi.com
Our webpage on MAGI Adjusted Gross Income

Our webpage on Schedule C Profit or Loss from a Business
How to project income Biz Fluent
Projection of Income with and without corona virus?
I have my docs ready.
ADP already had a certified payroll report for 2019, I downloaded payroll for 2020 through 2/07,
I have a summary of health insurance costs,
I have an audited report from my workman’s comp insurance company,
I downloaded all the invoices from ADP for their payroll and 401k admin services and I got a pdf copy of the amount I contributed to retirement (401k) in 2019.
From what I read in the Cares Act, this was all I could find that I could include as part of my “payroll” costs.
Sounds right to me. See my excerpt above on payroll costs from the Interim Guidance
What about rent, mortgage & utilities?
That’s an interesting question. Rent is an allowable use of the proceeds. Section 1102.7 a (d) (D) BUT, it’s not shown as it can be forgiven Section 1105 (d)
On the other hand, let’s look at the Interim Guidance page 13
o. Can my PPP loan be forgiven in whole or in part?
Yes.
The amount of loan forgiveness can be up to the full principal amount of the loan and any accrued interest. That is, the borrower will not be responsible for any loan payment if the borrower uses all of the loan proceeds for forgiveable purposes described below and employee and compensation levels levels are maintained.
The actual amount of loan forgiveness will depend, in part, on the total amount of payroll costs, payments of interest on mortgage obligations incurred before February 15, 2020, rent payments on leases dated before February 15, 2020, and utility payments under service agreements dated before February 15, 2020, over the eight-week period following the date of the loan.
However, not more than 25 percent of the loan forgiveness amount may be attributable to nonpayroll costs. While the Act provides that borrowers are eligible for forgiveness in an amount equal to the sum of payroll costs and any payments of mortgage interest, rent, and utilities, the Administrator has determined that the non-payroll portion of the forgivable loan amount should be limited to effectuate the core purpose of the statute and ensure finite program resources are devoted primarily to payroll.
The Administrator has determined in consultation with the Secretary that 75 percent is an appropriate percentage in light of the Act’s overarching focus on keeping workers paid and employed. Further, the Administrator and the Secretary believe that applying this threshold to loan forgiveness is consistent with the structure of the Act, which provides a loan amount 75 percent of which is equivalent to eight weeks of payroll (8 weeks / 2.5 months = 56 days / 76 days = 74 percent rounded up to 75 percent). Limiting non-payroll costs to 25 percent of the forgiveness amount will align these elements of the program, and will also help to ensure that the finite appropriations available for PPP loan forgiveness are directed toward payroll protection.
SBA will issue additional guidance on loan forgiveness.
Certifications? Page 17
iv. Documentation verifying the number of full-time equivalent employees on payroll as well as the dollar amounts of payroll costs, covered mortgage interest payments, covered rent payments, and covered utilities for the eight week period following this loan will be provided to the lender.
v. Loan forgiveness will be provided for the sum of documented payroll costs, covered mortgage interest payments, covered rent payments, and covered utilities.
Los Angeles times on how freelancers can get unemployment benefits
https://sidehusl.com/qa-how-new-coronavirus-laws-impact-freelancers/