Governor Gavin Newsom declared a State of Emergency on March 4, 2020 related to COVID-19. The Governor then issued Executive Order N-33-20 (the “State Order”) on March 20, 2020, which mandates all individuals living in California stay home except as needed to continue the operations of federal critical infrastructure sectors.
For more information on what this means, please see the following link: https://www.californiaworkplacelawblog.com/wp-content/uploads/sites/867/2020/03/State-of-CA-N-33-20.pdf
- On March 11, 2020, President Trump announced that he would instruct the Small Business Administration (“SBA”), a government agency, “to exercise available authority to provide capital and liquidity to firms affected by the coronavirus.” He stated that he would ask Congress to increase funding for the SBA lending program to $50 billion. The SBA’s Economic Injury Disaster Loan program would provide businesses with working capital loans of up to $2 million. These loans have an interest rate of 3.75% for small businesses and 75% for nonprofits with varying loan repayment terms, up to a maximum of 30 years. More information is below; you can also call the SBA Disaster Assistance Customer Service Center at 1-800-659-2955 for help with your application.
For more information, please see the following link: https://www.sba.gov/page/coronavirus-covid-19-small-business-guidance-loan-resources
In addition, please see below for some steps that can help you as you complete the loan application:
- Please apply at the following link: https://disasterloan.sba.gov/ela/
- Please ensure that all of the following are completed:
- Disaster Loan Application Form (SBA Form 5) and select Economic Injury Disaster Loan (“EIDL”)
- SBA Form 1368
- SBA Form 413
- SBA Form 2202
- Most recent tax returns
- The SBA will be reviewing the forms for eligibility along with an initial credit check. Please ensure that your credit history meets the required threshold.
- The Sacramento loan processing center will contact borrowers to get clarification on the following:
- Missing items or clarifications
- You will need to substantiate the injury as the loans are not to cover lost revenue, but to maintain operations during the disaster
- The goal is to get the application approved within 2-3 weeks of application
Once approved, the loan documents will be sent to you and the funding will be within 5 days of receipt of the signed documents.
The terms such as the amount, repayment, etc. may change as needed with the change in the status of the COVID-19 situation
As a result of COVID-19, the IRS has also extended the federal tax return filing deadline to July 15, 2020. For tax payments up to $10 million, the deadline for businesses and individuals is extended to July 15, 2020 with estimated tax payments, which are normally due on April 15 now being due on July 15.
The California Franchise Tax Board also announced the filing and tax deadlines have been pushed to July 15, 2020 for a) 2019 tax returns, b) 2019 tax return payments, c) 2020 1st and 2nd quarter estimate payments, and d) 2020 non-age withholding payments. For CA state taxes.
Should you have any questions, please do not hesitate to contact your engagement partner at SingerLewak or our partner expert in SBA loans:
