Small Business Assistance

The following State and Federal Programs provide several different forms of financial assistance to small businesses during this time of crisis:


The California Rebuilding Fund

Low-Interest Loans for Small Business

  • 3-5 year term
  • Fixed annual interest rate (currently 4.25%)

Agency – California Infrastructure and Economic Development Bank

  • Qualifications:
    • 50 or less full-time equivalent employees
    • Gross revenues less than $2.5 million in 2019
    • Operating since at least June 30, 2019
    • Suffered direct economic hardship due to COVID-19

Governor's Budget seeks additional $25 million

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Tax Filing Extensions and Penalty Relief

Automatic tax filing deadline extension of 3 months

  • No interest or penalties will accrue if paid within three months of original due date

New Tax Filing Deadlines:

Filer Type

Original Filing Period

New Deadline

Annual Filers

January 2021

April 30, 2021

April 2021

July 15, 2021

Quarterly Filers

4th Quarter 2020

April 30, 2021

1st Quarter 2021

August 2, 2021

 

Agency – California Department of Tax and Fee Administration

  • Qualifications:
    • Normal filing deadline falls between December 1, 2020 and April 30, 2021
    • Reporting less than $1 million in taxes for that period
  • Normal filing deadline falls between December 1, 2020 and April 30, 2021
  • Reporting less than $1 million in taxes for that period

Those reporting up to $5 million in taxes are eligible for some interest/penalty free payment arrangements

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Programs Returning in Governor's Budget

Small Business COVID-19 Relief Grant

  • Grants of up to $25,000 for small businesses and non-profits
  • 1st and 2nd rounds of applications have closed
  • Governor's Budget seeks immediate additional $550 million

Main Street Small Business Tax Credit

  • Tax credit based on net increase in monthly average number of employees
  • Limited amount of credits given out on first-come first- serve basis
  • Governor's budget proposes offering credit for 2021 tax year

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Other Relief Proposed in 2021-22 Budget

License fees waived for:

  • Restaurants
  • Barbers
  • Cosmetologists
  • Bars
  • Manicurists

Cal Competes Tax Credits increased by $90 million

Establishment of Cal Competes grant program for businesses that:

  • Establish new jobs
  • Make significant infrastructure investments
  • Commit to high-need/high opportunity areas

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Important State Contacts

California Rebuilding Fund
https://www.connect2capital.com/p/californiarebuildingfund/
1-833-ASK-SBDC (275-7232)
loans@asksbdc.com

California Department of Tax and Fee Administration
https://www.cdtfa.ca.gov/services/covid19.htm
1-800-400-7115
https://www.cdtfa.ca.gov/email/

Governor's Office of Business and Economic Development
https://business.ca.gov/
1-877-345-4633
https://gobiz.zendesk.com/hc/en-us/requests/new

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Economic Injury Disaster Loans (EIDL)

  • 30 year fixed rate loans, 3.75% for business, 2.75% for nonprofits
  • $150,000 maximum, with the first payment deferred up to one year
  • Can be used for day-to-day expenses including rent, utilities, salaries

Eligibility:

  • Business suffered working capital losses due to the Coronavirus pandemic
  • Have fewer than 500 employees
  • Most private nonprofits, faith-based organizations, and sole proprietors and independent contractors are eligible
  • Apply online at DisasterLoanAssistance.sba.gov

If you are denied or would like to increase the amount of your loan, you can apply for reconsideration by:

EIDL application will be open until the end of the year

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Targeted EIDL Advance

Included in the Economic Aid package passed Dec. 27th

Grants up to $10,000 for eligible businesses who previously applied for the EIDL Advance after the funding had run out in mid-July

  • Business must be located in a low-income community with less than 300 employees
  • Suffered a greater than 30% decline in revenue during an 8-week period since March 2nd, 2020

Those that received an initial EIDL Advance amount of less than $10,000 will be prioritized, followed by applicants who applied before Dec. 27th

The SBA Will reach out to eligible applicants who qualify, you do not need to take any action at this time

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Paycheck Protection Program

  • $350 Billion allocated to the program under the CARES Act, an additional $285 Billion was allocated for the program on Dec. 27th
  • Forgivable loans for businesses to keep their workforce employed during the Covid-19 crisis
  • The loan can cover eligible expenses for an 8–24-week period
  • Sole proprietorships, independent contractors, and self-employed individuals are all eligible

At least 60% of the PPP Loan must be used to fund payroll and employee benefits

  • Salary, Wages, commissions, tips, bonuses and hazard pay
  • Employee benefits including costs for vacation, parental, family, medical or sick leave allowance, group health care benefits payments

The remaining 40% can be used for

  • Mortgage interest payments
  • Rent and lease payments
  • Utilities
  • Operations expenditures, like software and accounting needs
  • Supplier costs

First Draw vs. Second Draw

If you received a PPP loan already, you can apply again if

  • You have no more than 300 employees
  • You can demonstrate at least a 25% reduction in gross receipts in comparable quarters in 2019 and 2020

Max amount for Second draw is $2Million

Must apply before March 31st, or appropriations expire

  • The maximum amount you can receive from your SBA-approved lender is your monthly average payroll cost in 2019, 2020, or any one-year period, multiply it by 2.5, up to a maximum of $2 million
  • For businesses in the food and accommodation industries, you are eligible for 3.5 times your average payroll costs, also with a maximum of $2 million (For Second Draw Only)
  • Need help finding a lender: www.sba.gov/funding-programs/loans/lender-match

Loan may be fully forgiven if:

  • Employee and compensation levels are maintained
  • The loan proceeds are spent on payroll costs and other eligible expenses; and
  • At least 60 percent of the proceeds are spent on payroll costs

A borrower can apply for forgiveness once all loan proceeds have been used, payments are differed for up to 10 months

Contact lender for forgiveness application

  • Be ready to show proof of payroll and eligible expenses

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American Rescue Plan

  • $175 billion in additional small business lending and investment.
  • Reimburse employers with less than 500 employees for the cost expanded sick leave, to promote safer workplaces and control the virus. Extending the refundable tax credit will reimburse employers for 100 percent of the cost of this leave.
  • Expand testing and vaccination efforts across the country.

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