The CARES Act
Part of the relief from the CARES Act is for small businesses. To keep workers employed and small businesses open, $350 billion dollars has been allocated towards small businesses. Additionally, these loans may be forgiven if small business owners continue payroll during this crisis or reinstate payroll after.
The most common small businesses that are eligible include businesses with less than 500 employees, sole proprietors, and independent contractors. The U.S. Chamber of Commerce has a list of other eligible businesses in the link below. Furthermore, borrowers should have been in operation before February 15, 2020, and paid a salary to employees (if they had employees) as well as payroll taxes. Other documents will be required from independent contractors and sole proprietors which have yet to be announced.
A loan cannot be more than $10 million. The equation for a loan amount is calculated by multiplying a small business owner’s average monthly payroll cost by 2.5. Find more information from the U.S. Department of Commence in the link below.
Learn more about small business loans from the U.S. Department of Commerce.
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