According to the governor, over 500,000 people in Illinois have filed for unemployment in the last 5 weeks. That unemployment number shows how small businesses in our state have been impacted by Covid-19. Luckily, there is a program that can help.
SMALL BUSINESS PAYCHECK PROTECTION PROGRAM
The Paycheck Protection Program provides small businesses with funds to pay up to 8 weeks of payroll costs including benefits. Funds can also be used to pay interest on mortgages, rent, and utilities.
Fully Forgiven
Funds are provided in the form of loans that will be fully forgiven when used for payroll costs, interest on mortgages, rent, and utilities(due to likely high subscription, at least 75% of the forgiven amount must have been used for payroll).
Loan payments will also be deferred for six months. No collateral or personal guarantees are required. Neither the government nor lenders will charge small businesses any fees.
Must Keep Employees on the Payroll—or Rehire Quickly
Forgiveness is based on the employer maintaining or quickly rehiring employees and maintaining salary levels. Forgiveness will be reduced if full-time headcount declines, or if salaries and wages decrease.
All Small Businesses Eligible
Small businesses with 500 or fewer employees—including nonprofits, veterans organizations, tribal concerns, self-employed individuals, sole proprietorships, and independent contractors—are eligible. Businesses with more than 500 employees are eligible in certain industries.
When to Apply
Starting April 3, 2020, small businesses and sole proprietorships can apply. Starting April 10, 2020, independent contractors and self-employed individuals can apply. We encourage you to apply as quickly as you can because there is a funding cap.
How to Apply
You can apply through any existing SBA 7(a) lender or through any federally insured depository institution, federally insured credit union, and Farm Credit System institution that's participating. Other regulated lenders will be available to make these loans once they are approved and enrolled in the program. You should consult with your local lender as to whether it is participating.
All loans will have the same terms regardless of lender or borrower.
How Marvel Law Can Help
We have prepared a detailed PDF that you can download for complete and easy to understand information. Click here to download that information. At Marvel Law, we are here to help serve you with purpose. Click here to email us or call us at 309-807-2885 for your FREE 15-minute consultation. Due to the Stay At Home order, we are offering FREE 15-minute video conference consultations. To take advantage of the video conferencing ability, please email us to set up a time.
