5 Tips for Applying for CARES Assistance During COVID-19
During the first Vishion Virtual Market, Tax attorney Brian Bernhardt walked attendees through information in regards to the CARES program. Established by the federal government during the coronavirus pandemic, CARES seeks to provide fast and direct economic assistance for American workers, families, and small businesses, and preserve jobs for our American industries. On Monday, April 27, the program began accepting additional applications after funding was added. If you’re looking for economic relief, here are 5 tips for applying for assistance for your small business
Applying for CARES During COVID-19
Tips for Applying for CARES
- Act Fast
- Have your information ready to go
- Use the money in the right way
- Be Persistent
- Be ready to move your cash
CARES and Small Businesses
With business’ storefronts shuttered and profits plummeting, many Interior Design firms and designers are searching for answers on how to weather the coronavirus storm. The Wall Street Journal reports that 5 million jobs in the United States are in jeopardy. Brian Bernhardt is a tax attorney with more than 20 years of experience, specializing in providing advice for businesses, non-profit organizations, and individuals. He says if you are one of these companies or individuals impacted, the CARES act can help you weather the economic impacts of COVID-19.
According to the Washington Post, During the first round of funding, about 70% of small businesses applied for the initial program, eating up $349 billion dollars in just two weeks. The program resumed operation, with additional funding, on April 27.
“Main focus of the CARES act is the Paycheck Protection Program which provides $659 billion dollars in loans to small businesses, non-profits, and other businesses on a first come, first served basis.” -Brian Bernhardt
2.Have Your Information Ready
Bernhardt says that the CARES act is designed to help small businesses maintain operations, like full-time employees and payroll, for as long as the virus exists. The Act defines small businesses as any company with no more than 500 employees located in the United States. The goal of the program is to cover 2.5 months of average monthly payroll. When you call your lender, make sure you have your information ready: payroll costs, employee count, benefits, etc.
“When you get this PPP loan, you can use it for: payroll costs, costs for group health, benefits, paid sick, insurance, salaries, interest on mortgage obligations, rent, utilities, or on any other debts incurred prior to Feb 15.”
3. Use the Money In The Right Way
It’s not written into the CARES act, but the Small Business Association has decided that you have to use 75% of the money given for payroll costs: salaries, wages, commissions, tips, parental leave, vacation, severance payments, healthcare benefits, retirement benefits, state and local employment taxes (not federal). When you receive your federal assistance, make sure you are using the cash defined in the rules.
Five things not considered payroll costs:
1. Payroll costs cover up to $100k of an employee salary. Salaries over 100k get capped, and the additional money is subtracted out.
2.Federal employment taxes
3.Compensation for any employee whose place of residence is outside of the United States
4.Sick leave wages and family leave wages that you are paying to anyone under family first Act
BANKS and Applying for CARES
4. Be Persistent
Bernhardt says to keep in mind that banks are running this program differently. He says to act quickly because each bank has placed a threshold on assistance, and applications already began on April 3. He says that depending on how long the pandemic continues, Congress may need to pass additional bills. If you can’t get ahold of your bank and/or lender, keep calling
5. Be Ready to Move Your Cash
If you’re having issues getting information or assistance from your bank, he suggests reaching out to another institution but be ready to move your cash that same day.
Watch Brian’s FULL #VirtualMarket Presentation
Vita is an Emmy-nominated journalist that has a passion for creative content and color. Inspired by the places she travels and the products she loves, Vita’s design style is transitional with a little edge.