The President signed recently into law the third and largest coronavirus relief package, which is meant to help struggling businesses and displaced workers during the pandemic. The Coronavirus Aid, Response, and Economic Security (CARES) Act is designed to pause the economy by providing relief to for businesses and employees through the following:
- Unemployment insurance
- Business loans
- Employer-sponsored health insurance
- Retirement savings
- Employer-provided education assistance
For a complete summary of the CARES ACT provided by SHRM, click here.
Business Loans provided in the CARES Act will be up to a business’s sum of the average total monthly payments of the prior year’s payroll. On the other hand, loan providers will use a slightly different calculation for seasonal employers. Also, the loan amount will take into special consideration those companies who were not yet in business during the prior year. Small business disaster loans under the CARES Act will cap at $10,000,000.
It is important to remember that the funds are truly only to be used for the following purposes:
- Payroll costs
- Group health care benefits
- Employee compensation
- Mortgage interest
- Rent
- Utilities
- Other debt interest incurred prior to the covered period
To apply for business loans, visit disasterloan.sba.gov/ela/ to begin the process.
