As a member of the National Society of Accountants, we often receive some great information that we can use to assist our clients the society recently got some answers to questions many of you have been asking us from the SBA.
Here are some questions that the National Society of Accountants put to the SBA about the COVID-19 disaster (EIDL) and Payroll loan programs available. This information was received Monday 4/13/20 and is, of course, subject to updating and changes by the SBA.
The National Society of Accountants received the following responses from the SBA on the issues raised. The responses below are unedited and just as received by the National Society of Accountants from the SBA.
Has the SBA reduced the total maximum loan under EIDL from $2 million down to only $15,000?
SBA Response:
A final decision has not been made yet on reducing the initial disbursement of loans. Any changes will be announced by SBA.
Has the emergency portion of the EIDL been reduced from $10,000 to $1,000 per employee for a maximum of $10,000?
SBA Response:
To ensure that the greatest number of applicants can receive assistance during this challenging time, the amount of the Advance will be determined by the number of your pre-disaster (i.e., as of January 31, 2020) employees. The Advance will provide $1,000 per employee up to a maximum of $10,000.
Is it correct that businesses involved in commercial real estate LLCs that do not have employees, would not be eligible for significant loans or grants under the EIDL?
SBA Response:
The EIDL Advance provides up to $10K, depending on the number of pre-disaster employees, and the loan provides up to $2 million for working capital needs, including payroll and other operating expenses. Some types of small businesses are not eligible for economic injury disaster loans, including real estate developers (i.e. establishments primarily engaged in subdividing real property into lots and developing it for resale on their own account). Real estate investments held for rental are eligible for EIDL Assistance.
Have any small businesses received EIDL emergency funds loans as of April 10, 2020?
SBA Response:
SBA cannot confirm this but can confirm that SBA has been approving and disbursing both EIDL Advance and Loan funds; and we expect it to increase over the next week.