Help for Small Businesses Impacted by the COVID-19 Crisis

Small Businesses Impacted by COVID-19 of all sizes across the United States are facing devastating financial challenges. Small businesses are getting particularly hard hit. 

The vulnerability of small businesses has to do with the fact that the smaller a business, the greater its credit constraints and sensitivity to weak consumer demand. The COVID-19 crisis is particularly damaging to small businesses that rely heavily on foot traffic and social interaction.

While it is difficult to remain optimistic in times like these, it is important for small business owners to realize that there is help for them to weather this storm. If you are a small business owner wondering where to find such help, here are some things to consider:

• Federal Assistance: The government has rolled out the Paycheck Protection Program to help businesses keep current employees on the payroll or rehire employees they were forced to lay off. Businesses with fewer than 500 employees, including nonprofits and freelancers, can receive 2.5 times their monthly payroll in loans up to $10 million. The interest rate is 1%, and can be eligible for forgiveness.

• Small Business Administration Loans: The U.S. Small Business Administration (SBA) has created a relief plan to help small businesses affected by coronavirus through affordable loan options. The disaster assistance loans for small businesses program offers interest rates of 3.75% for small businesses without credit available elsewhere, and interest rates of 2.75% for nonprofits. The SBA offers long-term repayment options on these loans of up to 30 years. Businesses with credit available elsewhere are not eligible for these loans. You can learn about applying for these loans and other financial assistance options by visiting the U.S. Chamber of Commerce website. 

• Tax Payment Extension: The Internal Revenue Service (IRS) is providing small business relief for those affected by the coronavirus pandemic. The IRS announced that it was giving both individuals and businesses a 90-day extension to pay tax fees. Individuals can delay making tax payments up to $1 million, and businesses can delay making payments up to $10 million. You will still need to file your taxes by April 15, 2020, but won’t need to pay owed taxes until July 15.

• Credit Card Companies: Several credit card companies are offering COVID-19 relief for small businesses. They’re doing this by waiving service fees for 30 days, or offering other types of disaster relief assistance for small businesses including negotiating payment timelines and fees. Check with your bank or credit card company to find out if they are offering any special services during the COVID-19 pandemic.

• Business Grants Through Private Companies: Facebook is making $100 in cash grants and ad credits available to small businesses. The grant money can be used to cover operational costs, take care of employees, pay rent, and more. Facebook is just one company offering help to small businesses but there are many others.

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