These are unprecedented times for dental offices and virtually all small businesses. Last Friday, the Federal Government signed into law The Cares Act, a $10,000 Loan and Payroll Protection Program designed to help small businesses. If you have not already applied or are not aware of these two opportunities for your business, you will want to read below and move quickly as the funds are limited and will most likely go quickly.
$10,000 Forgivable Loan
Last week, the Federal Government announced a $10,000 immediate Loan Advance for small business applicants (EIDA). The EIDA is part of the CARES Act that President Trump signed into law on Friday.
This Loan Advance aims to help small businesses pay operating costs in the short-term. It is fully forgivable. Practices do not need to be pay it back.
The government considers The CARES Act a Loan Advance as the $10K will be a reduction to a Payroll Protection Program Loan (PPP Loan) should a small business apply for and receive a PPP Loan (see Payroll Protection Plan below).
It takes 10 minutes or less to complete:
the SBA CARES form
The Loan Advance is available as long as funds are available on a first-come, first-serve basis. It is imperative small business owners do not delay applying. Demand will be very high, with thousands of applications. Successful applicants may receive the $10,000 directly deposited into their business bank account in as few as 2-4 days.
Payroll Protection Plan
The PPP is part of the CARES Act that President Trump signed into law on Friday. This loan intends to help small businesses continue to pay employees for the next 8 weeks. Subject to certain limitations, the PPP loan is fully forgivable if used for the purposes intended.
The loan is forgiven in July if a small business maintains the same amount of monthly payroll and headcount during the next 8 weeks as it did before February 15th and uses at least 75% of the loan for payroll. The amount of the loan is equal to 2.5X the average monthly payroll for employees that make less than $100,000.
The PPP went live on April 3rd for Small Business & Sole Proprietorships and goes live on April 10th for Independent Contractors and Self-Employed Individuals. Applicants must prepare and discuss documents with Bankers ASAP as they anticipate funds to be depleted quickly with high demand.
Below is a link that provides:
- A brief overview of the program
- Application – a simple 2-page document
- Instructions for Borrowers
- Instructions for the Lender (Banks, Credit Unions or Farm Bureau)