NCR CORONAVIRUS RESPONSE RESOURCES

COVID-19: Federal Disaster Response & Stimulus

Updated April 24, 2020


 

What’s New?

Congress approved additional funding for two Small Business Administration loan programs to help small businesses weather the coronavirus crisis.  $310 billion has been approved for the Paycheck Protection Program, and $60 billion has been approved for Economic Injury Protection Grants and Loans.  These loans are in high demand, and this funding will be committed quickly.  If you need assistance, see more details below.

If you need help applying for a loan, click here:  https://www.ncr.com/coronavirus/nymbus-smb-relief

 

Emergency assistance for small and medium sized businesses

Small and medium sized businesses are scrambling to navigate the impact of business disruptions and lost traffic during the coronavirus outbreak. At NCR, we’re committed to helping our small and medium sized business customers navigate this difficult time—starting with a list of federal assistance programs that are mobilizing to provide much-needed support.

To date, the federal government has provided over $700 billion for two important small business loan programs detailed below, including fully forgivable, federally guaranteed small business loans. Small businesses as well as independent contractors and the self-employed are eligible to apply.

Resources to help you apply for a loan can be found on the U.S. Small Business Administration website.

 

Please find qualification details below:

 

Small Business Loans (Paycheck Protection Program)

  • Small businesses, nonprofits, and veteran’s organizations with under 500 employees are eligible to apply. 
  • Self-employed individuals and independent contractors are also eligible for this program.
  • The maximum loan amount is $10 million through December 31, 2020, with the size of the loan tied to the average monthly payroll for 2.5 months.
  • The loans can be used to cover payroll, benefits, mortgage, rent, and utilities. The retroactive start date of February 15, 2020 incentivizes companies to rehire staff that have been laid off.
  • These loans can be forgiven (see next section).
  • Businesses in the hospitality and restaurant industries are eligible. Specifically, franchises who are assigned the NAICS code beginning with 72, and small businesses who receive financing through the Small Business Investment Company (SBIC) program are eligible.
  • Businesses with more than one physical location that employ no more than 500 employees per physical location in certain industries are also eligible.

 

Loan Forgiveness

  • Businesses are eligible for loan forgiveness equal to the amount spent during an 8-week period after the origination date of the loan on payroll costs, most interest payments on mortgages, rent or utility bills.
  • Amounts forgiven may not exceed the principal amount of the loan and eligible payroll costs do not include compensation above $100,000 in wages.

Forgiveness on a covered loan is equal to the sum of payroll costs incurred during the covered 8-week period compared to the previous year or time period.

 

Economic Injury Disaster Loans

  • Businesses impacted by COVID-19 are eligible to apply for Economic Injury Disaster Loans (EIDLs) of up to $2 million.
  • Businesses can also access capital in advance of up to $10,000 through the program, which may not require repayment. The SBA must distribute these advances within 3 days. This can be used for payroll, covered leave, and debt obligations.
  • The interest rate is 3.75% and 2.75% for not-for-profit organizations. Long-term repayments up to 30 years will keep payments affordable.
  • The loans can be used to pay fixed debts, payroll, accounts payable and other bills.
  • Terms are on a case-by-case basis, based upon each borrower’s ability to repay.
  • An emergency declaration must be made for a designated area before loans become available.
  • To find out how to apply for an EIDL loan, see below.

 

For more information on EIDL loans

To find out if you live in an eligible area, please click here. For more information, visit the Small Business Administration website at www.SBA.gov/disaster.

You can also contact the SBA Disaster Assistance Customer Service Center at 1-800-659-2955 (TTY: 1-800-877-8339) or email disastercustomerservice@sba.gov.

Entrepreneurial Development – Provides grants and funding to offer training, counseling, and assistance to small businesses affected by COVID-19.

  • SBA will provide additional financial awards to resource partners (Small Business Development Centers and Women’s Business Centers) to provide counseling, training, and education on SBA resources and business resiliency to small business owners impacted by COVID-19.

 

Tax incentives for small and medium sized businesses

Refundable tax credits and adjustments are available for employers affected by COVID-19.  Highlights are listed below.

For more information on these important new tax provisions, please go to: https://www.irs.gov/coronavirus/new-employer-tax-credits.

 

Deferral of Employer Payroll Tax

  • Allows companies to defer payment of their 2020 Social Security payroll taxes to future years with no penalty. Half will be due at the end of 2021, and the remaining half in 2022.

 

Employee Retention Tax Credit

  • Employers who have been hit with at least a 50 percent loss in gross receipts compared to the same quarter last year due to COVIC-19 are eligible.
  • Allows companies that maintain their payroll to receive a 50 percent credit on wages of up to $10,000 per employee.
  • Companies with 100 or fewer employees could obtain a 50 percent credit on all wages paid.
  • This is a refundable tax credit

 

Tax Credit for Emergency Paid Sick & Family Leave more details on requirements below

  • Employers will be reimbursed through a refundable tax credit that counts against employers’ payroll tax, which all employers pay regardless of non-profit/for-profit status.
  • Employers will submit emergency paid sick and family leave expenses as part of their estimated quarterly tax payments. If employer’s costs more than offset their tax liability, they will get a refund from the IRS

 

Modifications for Net Operating Losses

  • Relaxes the limitations on a company’s use of losses. Allows for net operating losses arising in a tax year beginning in 2018, 2019, or 2020 to be carried back five years.

 

Bonus Depreciation for Qualified Improvement Property

  • Fixes an error in the 2017 tax reform law that hurt restaurants and retailers.
  • Clarifies that investments in “qualified improvement property” are eligible for 100% bonus depreciation through 2022.  
  • Businesses can amend prior-year tax returns to receive refunds.

 

New requirements for small and medium sized businesses

In addition to new tax benefits for employers, there are also new mandatory sick leave and emergency family and medical leave requirements that apply through December 31, 2020.  The sick leave and family leave requirements were included in the Families First Coronavirus Response Act (HR 6021), which was signed into law on March 18.

 

New Emergency Paid Sick Leave Requirements*

Employers with fewer than 500 employees must provide two weeks of emergency paid sick leave for employees related to COVID-19. Full-time employees must be compensated for 80 hours. Part-time employees must be compensated for their typical number of hours worked.

What’s covered:

  • Comply with a quarantine related to coronavirus (100% of pay)
  • Seek diagnosis or preventive care for coronavirus (100% of pay)
  • Care for a sick family member (two-thirds pay)
  • Care for a child whose school is closed (two-thirds pay)    

Who Pays for the Emergency Paid Sick Leave?

  • Employers initially front the cost of emergency paid sick leave but will be fully reimbursed by the federal government within three months.
  • The reimbursement will cover both the wages paid and the employer’s contribution to employee health insurance premiums during the period of leave.
  • Employers will be reimbursed through a refundable tax credit that counts against employers’ payroll tax, which all employers pay regardless of non-profit/for-profit status.
  • Employers will submit emergency paid sick leave expenses as part of their estimated quarterly tax payments. If employer’s costs more than offset their tax liability, they will get a refund from the IRS.

 

New Emergency Paid Family Leave Requirements*

Employers with fewer than 500 employees must provide twelve weeks of job-protected leave for employees who have been on the job for at least 30 days. The first ten days are unpaid leave, followed by ten weeks of paid leave. Eligible employees may elect or be required to overlap the initial two weeks of unpaid leave with two weeks of other paid leave they have available. Employers will pay no less than two-thirds of an employee’s usual pay for the final ten weeks. Assistance is capped at $10,000 per employee.

What’s covered:

  • Care for a child in the event of a school closure or their childcare provider is unavailable due to COVID-19.

Who Pays for the Emergency Paid Family Leave?

  • Employers initially front the cost of emergency paid sick leave but will be fully reimbursed by the federal government within three months.
  • The reimbursement will cover both the wages paid and the employer’s contribution to employee health insurance premiums during the period of leave.
  • Employers will be reimbursed through a refundable tax credit that counts against employers’ payroll tax, which all employers pay regardless of non-profit/for-profit status.

Employers will submit emergency paid family leave expenses as part of their estimated quarterly tax payments. If employer’s costs more than offset their tax liability, they will get a refund from the IRS.

 

*The Department of labor may issue exemptions for employers with fewer than 50 employees.    

 

 The U.S. Department of Labor has published guidance for businesses on complying with these requirements.  Please see more details here:

https://www.dol.gov/agencies/whd/pandemic

 

Need more information?