The following content is informational only. When making business decisions, we encourage you to seek personalized advice from qualified professionals.
We have great news.
Earlier today, Congress and the White House passed a $2 trillion stimulus package in response to the COVID-19 outbreak. The package, known as the “CARES Act,” will open up new small business loans for many retailers and makers that need support during this difficult period.
The impact on your business is likely substantial. Legislation like this comes in complicated legalese, so we have worked to help you interpret the potential impact of the CARES Act on small businesses. We’ve also built a dedicated site for you to more easily understand the two main options for financial relief available through this stimulus.
In the coming days, the Small Business Administration (SBA) is expected to clarify and provide guidance on the overall package details, so details may change. In the meantime, eligible companies can begin taking steps now to ensure that they receive much-needed support to cover operating costs and take advantage of loan forgiveness opportunities.
While we still have a ways to go before recovery can begin, this act is a hopeful signal for the future. There’s a light at the end of the tunnel for our industry and we’ll be by your side during these next steps forward.
What is the CARES Act?
The “CARES Act” is a $2 trillion stimulus package with significant focus on small- and medium-sized businesses. Relevant sections include:
- $377 billion in funds for small businesses. Act quickly to apply to these. The Paycheck Protection Loans come with 8 weeks of loan forgiveness as a grant if you maintain payroll or rehire to pre-COVID-19 staffing levels, and the Disaster Loans (EIDLs) come with a $10k advance in under three days. To help you decide what’s best for your business, we’ve broken down the two main options for financial relief.
- $300 billion in direct payments to households. This is intended to generate demand from customers and may be sent to you personally. Most adults would get $1,200 although some would get less, as the payment decreases until it stops altogether for single individuals earning $99,000 per year or married couples earning $198,000 per year. For every child ages 16 and under, the payment would be an additional $500. Read more about this plan here.
- Business and income taxes will be deferred and/or have extended timelines. The filing deadline for businesses and individuals will be 90 days later this year (July 15th, 2020). Businesses get the ability to apply losses from 2018, 2019, or 2020 to past years’ profits and claim refunds. Employers will also be able to defer paying their share of 2020 payroll taxes, and they could then make half of those payments in 2021 and the other half in 2022.
- Store property improvements are getting a tax break. If you’ve fixed up your store in the last 2 years, this bill includes fixing a mistake in the 2017 tax law that curbed depreciation deductions on renovations. This could mean tax benefits for you.
- Expanded unemployment benefits. These resources increase the duration of unemployment benefits, and offer an extra $600 per week on top of state unemployment benefits. You can read more about unemployment benefits here.
- Other major sections detail support across the economy, including providing the healthcare system with additional support, loans to large corporations, and additional topics that are less directly relevant to your business. You can read a summary of the bill here and read the full CARES Act here.
Start applying for relief funding today
You can visit our small business relief resources page to understand the two main options for your business.
We’re here for you
We’re committed to giving you the information you need to make important decisions about your business, and will provide more updates and trusted information as it becomes available. Please find more resources for makers here.
Our team is inspired every day by the resiliency of small businesses and independent entrepreneurs, and we’re looking forward to a day when this unprecedented moment in time is behind us. We believe that by working together, we will come through this experience stronger than before.
Please stay safe, stay connected, and join the conversation in our maker community forum.