Coronavirus Business Resources

How CARES Act Helps Business and Workers

How To Apply for the Paycheck Protection Program

The Act provides assistance of both emergency relief for small businesses and working families, and ensures that state and local governments and companies have the funds needed to cover gaps in which normal revenues are not collected due to the COVID-19 response. The CARES Act includes:

  • $500 billion in loans for distressed companies.
  • $377 billion for small businesses:
    • $350 billion for SBA loans;
    • $17 billion for six months payments for business currently utilizing SBA loans;
    • $10 billion for grants of up to $10,000 for emergency funds.
  • $260 billion in unemployment insurance benefits;
  • $250 billion set aside for direct payments to individuals and families (with American adults earning $75,000 or less receiving $1,200 for individuals, $2,400 for married couples, and $500 additional per child; and adults earning more than $75,000 receiving a lesser amount);
  • $150 billion for hospitals to invest in equipment and infrastructure;
  • $150 billion to assist states and localities.
Read the CARES Act in its Entirety

Most of the bill’s business assistance funding can be found in Division A, elements of which are explained below:

Business Provisions

This information provides an overview of top available resources for businesses in the CARES Act, but does not detail the stipulations and oversight associated with each type of funding, nor detail all types of non-business-related information:

Small Business Assistance (Title I)

  • Includes $350 billion in loan forgiveness grants to small businesses and non-profits to maintain the existing workforce and pay for expenses like rent, mortgage, and utilities.
  • The size of the loans would equal 250% of an employer’s average monthly payroll. The maximum loan amount would be $10 million.
  • Loans would be available immediately through more than 800 existing SBA-certified lenders, including banks, credit unions, and other financial institutions.
  • Defines eligibility for loans as a small business, 501(c)(3) nonprofit, a 501(c)(19) veteran’s organization, or Tribal business concern described in section 31(b)(2)(C) of the Small Business Act with not more than 500 employees, or the applicable size standard for the industry as provided by SBA, if higher.
  • It also includes sole-proprietors, independent contractors, and other self-employed individuals as eligible for loans.
  • Includes $17 billion for Small Business Administration (SBA) to cover six months of payments for small businesses with existing SBA loans.
  • Requires SBA to pay all principal, interest, and fees on all existing SBA loan products for six months.
  • Includes $265 million for grants to SBA resource partners, including Small Business Development Centers and Women’s Business Centers, to offer counseling, training, and related assistance to small businesses.
  • Expands eligibility for entities suffering economic harm due to COVID-19 to access SBA’s Economic Injury Disaster Loans.

Government Loans for Struggling Industries & Related Transparency Measures (Title IV)

  • Defines “Eligible Business” as a U.S. business that has not otherwise received adequate economic relief in the form of loans or loan guarantees provided under this Act.
  • Provides $500 billion to Treasury’s Exchange Stabilization Fund to provide loans, loan guarantees and other investments, including:
    • $454 billion is available for Federal Reserve loans, loan guarantees, and investments to eligible businesses, states, and municipalities;
    • $25 billion for passenger air carriers and related businesses;
    • $17 billion for businesses important to maintaining national security;
    • $4 billion for cargo air carriers.

Other Aviation Industry Provisions (Title IV)

  • $25 billion in grants for the passenger air carriers.
  • $4 billion in grants for the cargo aviation industry.
  • $3 billion in grants for aviation industry contractors.

Payroll Tax Credit (Title II, Subtitle C)

  • Provides a refundable payroll tax credit for 50% of wages paid by employers to employees during the crisis. The credit is available to employers whose (1) operations were fully or partially suspended, due to a COVID-19-related shut-down order, or (2) gross receipts declined by more than 50 percent when compared to the same quarter in the prior year. Credit is based on qualified wages paid to the employee.
  • Employers and self-employed individuals can defer payment of the employer share of the Social Security tax they otherwise are responsible for paying to the federal government with respect to their employees.

Paid Leave (Title III, Subtitle C)

  • Creates a limitation on paid leave stating an employer shall not be required to pay more than $200 per day and $10,000 in the aggregate for each employee.
  • Creates a limitation stating an employer shall not be required to pay more than $511 per day and $5,100 in the aggregate for sick leave or more than $200 per day and $2,000 in the aggregate to care for a quarantined individual or child for each employee.
  • Ensures that federal contractors who cannot perform work at their duty-station or telework because of the nature of the job due to COVID-19, continue to get paid.

Other Business Provisions (Title II, Subtitle C)

  • Provides that net operating losses (NOL) arising in a tax year beginning in 2018, 2019, or 2020 can be carried back five years. It also temporarily removes the taxable income limitation to allow an NOL to fully offset income.
  • Fixes cost recovery for investments in Qualified Improvement Properties, which will allow businesses that made these investments in 2018 and 2019 to receive tax refunds now.
  • Modifies the loss limitation applicable to pass-through businesses and sole proprietors so they can utilize excess business losses and access cash flow.
  • Accelerates the ability for companies to recover Alternative Minimum Tax credits, permitting companies to claim a refund now.
  • Temporarily increases the amount of interest expense businesses are allowed to deduct on their tax returns by increasing the 30% limitation to 50% taxable income (with adjustments) for 2019 and 2020.
  • Enables businesses (particularly retail establishments, restaurants, and hotels) to write off immediately costs associated with improving facilities instead of having to depreciate those improvements over the 39-year life of the building. This provision corrects an error in the Tax Cuts and Jobs Act.
  • Prohibits foreclosures on all federally-backed mortgage loans for a 60-day period beginning on March 18, 2020. (Title IV).

Workforce Benefits and Unemployment

This information provides an overview of top available resources for businesses in the CARES Act, but does not detail the stipulations and oversight associated with each type of funding, nor detail all types of non-business-related information:

Unemployment Insurance (Title II, Subtitle A)

  • Creates a temporary Pandemic Unemployment Assistance program through December 31, 2020, to provide payment to those not traditionally eligible for unemployment benefits (self-employed, independent contractors, those with limited work history, and others).
  • Provides payment to states to reimburse nonprofits, government agencies, and Indian tribes for half of the costs they incur through December 31, 2020, to pay for unemployment benefits.
  • Includes an additional $600 per week payment to each recipient of unemployment insurance or Pandemic Unemployment Assistance for up to four months. (Laid-off workers currently qualify for up to 26 weeks of unemployment insurance and benefit levels vary by state.)
  • Provides an additional 13 weeks of federally-funded unemployment insurance benefits through December 31, 2020, to help those who remain unemployed after weeks of state unemployment benefits are no longer available.

Direct Cash Payouts to Americans

This information provides an overview of top available resources for businesses in the CARES Act, but does not detail the stipulations and oversight associated with each type of funding, nor detail all types of non-business-related information:

Direct Payments to American Workers, (Title II, Subtitle B)

  • Cash payments to working adults are $1,200 ($2,400 married), with an additional $500 cash payment available per child.
  • Full payment is available for Americans making up to $75,000 (individuals) and $150,000 (married). This applies even for those who have no income, as well as those whose income comes entirely from non-taxable means-tested benefit programs, such as SSI benefits.
  • The value decreases and then phases out completely for those making over the full payment income cap. Rebate amount is reduced by $5 for each $100 that a taxpayer’s income exceeds the phase-out threshold.  Complete phase-out occurs with incomes exceeding $99,000 for single filers and $146,500 for head of household filers with one child, and $198,000 for joint filers with no children.

Health Care

This information provides an overview of top available resources for businesses in the CARES Act, but does not detail the stipulations and oversight associated with each type of funding, nor detail all types of non-business-related information:

“Marshall Plan” for Health Care Systems (Title III, Subtitles A and D)

  • Clarifies that the Strategic National Stockpile can stockpile medical supplies, such as testing swabs.
  • Provides permanent liability protection for manufacturers of respirators.
  • Clarifies all testing for COVID-19 is to be covered by private insurance plans (without cost-sharing).
  • Provides free coverage of a COVID-19 vaccine (without cost-sharing) within 15 days.
  • Provides $1.32 billion in supplemental funding to community health centers for testing and treating of COVID-19.
  • It allows nurse practitioners and physicians’ assistants to be able to prescribe home health services.
  • It allows patients to use HSAs and FSAs to buy over-the-counter medicines tax-free without a prescription.
  • Supports the healthcare workforce, including reauthorization of health professions workforce programs, education and training related to geriatrics, and nursing workforce development.
  • Removes barriers to allow the Biomedical Advanced Research and Development Authority (BARDA) to partner with the private sector on research and development and to allow BARDA to expedite diagnostics and vaccines.

Business-Related Details in Division B of the CARES Act

The emergency supplemental appropriations portion of the CARES Act agreement contains $330 billion in new funding to address the pandemic. This does not include the mandatory or authorizing provisions of the agreement (as summarized above). It includes the following:

  • $100 billion for a new program to provide grants to hospitals, public entities, not-for-profit entities, and Medicare and Medicaid enrolled suppliers and institutional providers to cover unreimbursed healthcare-related expenses or lost revenues attributable to the public health emergency resulting from the coronavirus
  • $25 billion for transit systems for health and safety measures but also to ensure access to employment and other essential services.
  • $16 billion to replenish the Strategic National Stockpile supplies of pharmaceuticals, personal protective equipment, and other medical supplies, which are distributed to State and local health agencies, hospitals and other healthcare entities facing shortages during emergencies.
  • $11 billion to support research and development of vaccines, therapeutics, and diagnostics to prevent or treat the effects of coronavirus
  • $10 billion in grants for airports.
  • $6.5 billion for Community Development Block Grants, the Economic Development Administration, and the Manufacturing Extension Partnership to help mitigate local economic crises and rebuild impacted industries like tourism and manufacturing supply chains.
  • $1 billion for the Defense Production Act to support domestic supply chains, enabling the industry to quickly increase the production of personal protective equipment, ventilators, and other medical supplies.

At 880 pages long, the CARES Act will include many stipulations and implementation processes that affect the above information.

Loudoun Economic Development will continue to promote business and workforce resources that aid in the economic recovery, so please check back for more information as it becomes available.

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