Applying For The Payroll Protection Program And The Economic Injury Disaster Loan
When the economy takes a turn for the worse, it can be very hard for businesses to stay afloat. This is especially true for small businesses that lack funds and can’t afford to function like before when the economy was stable.
For such a problem the Small Businesses Administration introduced the Payroll Protection Program so small businesses can have funds to keep people employed and their business afloat.
What is the Payroll Protection Program?
This is a relief program for small businesses. In times of crisis, they can get hit the hardest and many people can lose jobs. This is why this is introduced so businesses can pay employees.
On the 21st of April, the Senate approved additional funds of over three billion dollars for the PPP as they ran out of the initial funds.
How to apply?
There are a few things to note and you can only qualify if:
You are a small business with less than five hundred employees
If you are in the hotel industry with more than five hundred employees
If you are in the food service industry with more than five hundred employees
If you are a non-profit organization
If you qualify and meet these conditions according to the guidelines of the Small Business Administration (SBA) then you will have to apply from their website and download their form.
This program is valid till June 30th so you will have to apply before that. A business can only apply for one loan and you will be required to provide a taxpayer identification number.
Economic Injury Disaster Loan
This also another form of financial assistance by the SBA, however, this relief is not just for small businesses. It applies to all private sector businesses such as small businesses and non-profit organizations that have suffered an economic injury and are located in a disaster area.
It is set to provide at least $10,000 to businesses that need it.
Are you ready apply for the EIDL or PPP?
Before you do, there are some things you should know! Here is a list of business information you will need when applying:
- Business entity information (Business name, EIN, business address and start date)
- Proof of ownership
- Articles of organization
- Operating agreement
- Proof of active registration (Secretary of State)
- 2018 tax return
- 2019 tax return
- 2020 total income
- 2020 total expenses
- 2019 total payroll (940, 941 or 944 payroll tax return)
- 2020 total payroll (940, 941 or 944 quarterly payroll tax return)
- Payroll docs - W3 if needed
- 2019 1099s for contractors
- W9 for contractors
- Current rental lease
- Current utility bill
- Business owner driver license
- Voided check and/or bank statement
What do you need to qualify?
You need to meet the size standards and the definition of a small business that comes under the SBA. If you meet such qualifications then you can apply for the loan through their website.
You can receive funds within days once you have successfully applied for the loan.
You’ll also need the following:
Payroll documentation (941, 940),
Owner’s driver’s license,
Articles of incorporation/organization,
SBA form 1919,
12-month Profit & Loss Statement,
Mortgage statement/rental lease and,
Why have these assistance programs been introduced?
Right now, the whole world is in crisis. The United States especially has the most cases and businesses are in turmoil. The government sees this problem and so they have set out funds to assist businesses.
The first set of funds finished within thirteen days of introduction and now they have allocated more to meet the needs of all small businesses. One thing to remember here is to check all your information and thoroughly read the application so you know what it requires and you can accurately fill it.
Ready to get funded?
We'd love to learn more about your funding need. We're ready to review your financial statements to help you prepare your for your loan meeting with your preferred lender. Schedule your session here:
Remember, every dollar counts.
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