The Senate passed the CARES Act, which provides a broad range of relief to individuals and businesses suffering in the wake of the coronavirus pandemic.
Here is a summary of the payroll relief that will go into effect if this bill is passed House:
- The Small Business Administration would provide loans to any business concern with fewer than 500 employees. This includes sole proprietors.
- The loans will cover two and a half months’ of your average monthly payroll (as averaged over the last year), with a cap of $10,000,000.
- The funds from these loans can be used for payroll costs, health care benefits, salaries, mortgage, rent, utilities, and interest on other debt obligations.
- Payments on these loans are deferred for six months to a year.
- Portions of the loan funds used for payroll, mortgage interests, rent and utilities are eligible to be forgiven.
The CARES Act also includes other forms of relief that will be of interest to small businesses. We are reviewing these portions as well and will follow up with appropriate summaries.
Please note that the House of Representatives has not yet voted on this Act. Amendments may occur before this bill becomes a law. We will keep you updated as we know more.