COVID-19 EIDL limit increase to $2 million

The U.S. Small Business Administration (SBA) announced several updates to the COVID-19 Economic Injury Disaster Loans (EIDL) program, including raising the loan cap from $500,000 to $2 million.  All changes are effective immediately. In addition to the expanded cap, the most important changes are outlined below:

Implementation of a deferred payment period 

  • Payments are deferred for the first two years (during which interest will accrue).  Previously, the SBA had indicated an 18-month deferment period for loans made during 2021.

Establishment of a 30-day exclusivity window

  • SBA said it is implementing a 30-day exclusivity window of approving and disbursing funds for loans of $500,000 or less. Approval and disbursement of loans over $500,000 will begin after the 30-day period.

Simplification of affiliation requirements

  • SBA  has established more simplified affiliation requirements to model those of the Restaurant Revitalization Fund.

Expansion of Eligible Use of Funds

  • SBA has established more simplified affiliation requirements to model those of the Restaurant Revitalization Fund. Eligible small businesses, nonprofits, and agricultural businesses in all U.S. states and territories can apply.
  • Visit www.sba.gov/eidl to learn more about eligibility and application requirements.
  • The last day that applications may be received is December 31, 2021. All applicants should file their applications as soon as possible.

 

Employee Retention Credit (ERC)

The bipartisan infrastructure bill which recently passed the Senate contains two provisions impacting the ERC.  The Senate version of the bill would end the ERC early, making wages paid after 9/30/21 ineligible for the credit instead of ending the program at 12/31/2021.

The legislation preserves the ERC for Recovery Startup Businesses (RSBs) through 12/31/2021.   As outlined in our previous newsletter, an RSB is an employer that commenced a trade or business after February 15, 2020, and had annual gross receipts of $1 million or less over a three-year lookback period (prorated for fewer than three years).

House Democrats have indicated a soft deadline of September 27 to vote on the bill.  We are following the legislation closely and will provide updates on any changes to the status and content of the legislation.

 

Provider Relief Fund – Additional Funding and Reporting Grace Period Announced

ADDITIONAL FUNDING

  • The Biden-Harris Administration announced today that the U.S. Department of Health and Human Services (HHS), through the Health Resources and Services Administration (HRSA), is making $25.5 billion in new funding available for health care providers affected by the COVID-19 pandemic.
  • CLICK HERE to read more about the timing and amount that your organization may be eligible for.

REPORTING GRACE PERIOD

  • The U.S. Department of Health and Human Services (HHS) has just announced a 60-day grace period for reporting on the Period 1 Provider Relief Funds. Additionally, any facility that has unused funds in this period will now have until December 30, 2021, to return the money.

Important Details

  • While you will be out of compliance if you do not submit your report by September 30, 2021, recoupment or other enforcement actions will not be initiated during the 60-day grace period (October 1 – November 30, 2021). The grace period begins on October 1, 2021, and will end on November 30, 2021.
  • Providers who are able to are strongly encouraged to complete their report in the PRF Reporting Portal by September 30, 2021. Providers should return unused funds as soon as possible after submitting their reports. All unused funds must be returned no later than 30 days after the end of the grace period (December 30, 2021).
  • This grace period only pertains to the Reporting Period 1 report submission deadline.
  • For additional updates, PRF recipients should now look to the new HRSA website.

 

Guidance issued on 2021 qualified sick and family leave wage reporting

  • Qualified sick and family leave wages are wages and compensation paid by an employer that is required to be paid under the Families First Coronavirus Response Act (FFCRA) as amended by the American Rescue Plan Act (ARPA).
  • Treasury Department and the Internal Revenue Service have issued Notice 2021-53 which provides guidance to employers about reporting on Form W-2 the amount of qualified sick and family leave wages paid in 2021.
  • Per the notice, qualified leave wages paid in 2021 should be reported in box 1 of Form W-2. To the extent they are Social Security or Medicare wages, they must also be included in box 3 (up to the Social Security wage base) and box 5. Employers must also report to the employee, either in box 14 or a separate statement, amounts of qualified leave wages separated and labeled with respect to whether they are for qualified sick leave or qualified family leave and with respect to applicable limitation amounts.
  • The wage amount that the notice requires employers to report on Form W-2 will provide employees who are also self-employed with the information necessary to determine the amount of any sick and family leave equivalent credits they may claim in their self-employed capacities.

 

Shuttered Venue Operators Grant program enters supplemental phase

  • The SBA is sending out invitations for Shuttered Venue Operators Grant (SVOG) recipients to apply for supplemental funding from the $16.25 billion programs.
  • SVOG supplemental awards are to be provided to those who received an initial grant and have illustrated a 70% loss when comparing 2021’s first-quarter revenues to the same in 2019.  Supplemental award applicants can choose to apply for any amount up to 50% of their original SVOG amount, with a $10 million cap of the initial and supplemental awards combined, according to the law. The supplemental awards also allow SVOG recipients to extend the time to use their grant funds for expenses accrued through June 30, 2022, and lengthen their budget period to 18 months from the initial grant’s disbursement date.

 

We have had a dedicated team in place for over a year working to ensure our clients are securing the maximum amount of eligible relief while complying with the cross eligibility rules of COVID19 relief programs. If you are interested in a complimentary phone call to discuss your eligibility for or questions on any of the COVID19 relief programs, please email cares@brinkersimpson.com with your information.