254.965.3185 info@allenlawfirm.com

We know you are receiving a lot of information and resources for all kinds of different topics. We are too!

This is why we are not going to “reinvent” the wheel completely but did want to point out a few very important things we hope you already know.

**SBA is unable to accept new applications at this time based on lack of funding.

Small Businesses:

 

Save Small Business Fund.

New Grants of $5,000 available from the US Chamber of Commerce. The Fund is providing $5,000 short-term relief to employers across the USA.

  • Must have between 3 – 20 employees and operate in economically vulnerable community.

Application available on Monday, April 20th, beginning at 2:00pm. 

Go Here for more information and to apply.

 

Women-Owned Business:

New Emergency Relief Grants of $10,000 available for women-owned businesses available through Texas Woman’s University.  Go Here for more information. 

Eligible Businesses:

  • Existing woman-owned business (at least 51% owned or controlled by one or more women) located in Texas
  • For-Profit Business
  • Business must be suffering hardship because of COVID-19
  • Other requirements.

 

Licensed Beauty Professionals:

$500 available through the Professional Beauty Association.  Go Here for more information and to apply.

 

1031 Exchange Deadline Changes:

  • 45-day identification period changes: If your identification period is set to expire between April 1 and July 15th, then the 45-identification period is automatically extended to end on July 15th.
  • 180-day exchange period changes: If your 180-day exchange period is set to expire between April 1 and July 15th, then the 180-day period is automatically extended to end on July 15th.

 

Re-Opening of Non-Essential Retail:

  • Governor’s Executive Order allows non-essential retail to open for to-go and delivery services on April 24th. Here is the Governor’s Order.
  • If you are a “Re-Opening Service, you can find guidance for doing this Here.

 

Paycheck Protection Program (PPP):

 

Snapshot: The CARES Act which has allocations for emergency loans for small businesses/non-profits to help keep workers employed. The loan program is known as the Paycheck Protection Program. Borrowers are eligible to have the loans forgiven if the loans were made in the covered period (February 15 – June 30) and the funds are used for the correct purposes.

Eligible Entities/People: Here is who is eligible (if in existence on January 31, 2020):

  • Businesses (and 501(c)(3)) with fewer than 500 employees
  • Individual who operates as a sole proprietor, an independent contractor, or is self-employed and regularly carries on any trade or business
  • Special Rules – if you are in the accommodation or food service sector the 500-employee rule is applied on a per physical location basis.
  •  

    Note – 500 employee threshold includes all employees (full, part, other)

    Loan Terms: A couple highlights of the terms of the loan:

    Loan Amount: 2.5x the borrowers average monthly payroll costs.

    Program open only until June 30, 2020.

    The debt forgiven is not included in taxable income.

    Any amount un-forgiven will be required to be paid back in 2-years and bear interest at 1%. The payments will be deferred for 6 months.

    No personal guarantee required.

    No collateral required.

    No origination fees or prepayment penalties.

    How are Payroll Costs Calculated?

    • For employers – these count as payroll costs:
      • the sum of any compensation with respect to employees that is a salary, wage, or similar compensation;
      • the payment of cash tip;
      • payment for vacation, parental, family, medical or sick leave;
      • payment for providing group health care benefits, including insurance premiums; and
      • payment of any retirement benefit.
    • For sole proprietors, independent contractors, self-employed individuals – these count as payroll costs:
      • The sum of payments of any compensation to or income of a sole proprietor or independent contractor that is a wage, commission, income, net earnings from self-employment or similar compensation (not more than $100k in one year), as prorated for the covered period.

    Note – these are not included as payroll costs: a) compensation of any individual employee in excess of $100k annual salary; b) payroll taxes; c) income taxes; d) compensation for an employee who lives outside of the USA; or d) qualified sick leave wages under the Families First Coronavirus Response Act.

    Loan Fund May Be Used For:

    • Payroll Costs
    • Interest on mortgage obligation
    • Rent under a lease
    • Utilities (electric, gas, water, phone, internet, and transportation)

    Note – not more than 25% of the forgiven amount may be used for non-payroll costs.

    Loan Forgiveness:

    • Borrowers are eligible for loan forgiveness equal to the amount Borrower spent on the proper loan fund uses during the 8-week period beginning on the date of the origination of the loan.
    • Forgiveness will be reduced if the Borrower reduces number of employees or reduces employee wages by more than 25%.
    • If Borrower eliminates the reduction in employees or wages by June 30, 2020 then the loan forgiveness will not be reduced.

    Check out This Guide for very valuable information and resource.

    Click HERE for a more detailed overview of the Paycheck Protection Program from the Treasury Department.

    Click HERE for an Application Form for the Paycheck Protection Program. This Application Form will be completed and submitted to your SBA Participating Lender.

    CLICK HERE for helpful information about calculating payroll costs.

    **SBA is unable to accept new applications at this time based on lack of funding.

    SBA Loans:

    Economic Injury Disaster Loans.

    These are loans for operational capital for eligible entities who have suffered substantial economic injury caused by a disaster.

    Eligible Entities/People: Here is who is eligible (if in existence on January 31, 2020):

    • Businesses with under 500 employees
    • Non-profits (most of them)
    • Sole Proprietors
    • Independent Contractors
    • Cooperatives, and some others

    $10,000 Grant: As part of the loan, a borrower may receive an emergency grant of $10,000. There is no obligation to repay the $10,000 grant and you are not required to have an approved Economic Injury Disaster Loan to obtain the grant.  But if you secure a PPP loan then the grant will be subtracted from the forgiveness amount.

    The PPP does not allow borrowers to take out two loans for the same purposes.

    Loan Terms:  A couple highlights of the terms of the loan:

    • The loan will be set up as a 30-year loan with payments to be deferred for 12 months.
    • Interest rate at 3.75% for businesses and 2.75% for non-profits.
    • No personal guarantee for loans up to $200,000
    • No collateral required for loans of $25,000 or less; general security interest in business assets for collateral in loans of $25,000 or more. No real estate collateral.
    • No closing costs.

    Go HERE for more information and to apply.

    Filing Requirements:

    Here are the filing requirements for one of these types of EIDL:

    • Electronic Loan Application (SBA Form 5) – can be done electronically
    • Electronic Loan Application (SBA Form 5C) – for sole proprietors only
    • Tax Authorization (IRS Form 4506-T) – signed by each principal owning 20% or more of the business; each general partner or managing member; and for any owner who has more than 50% ownership. Owners/GP/50% Affiliate
    • Most recent three (3) years of business tax return(s)
    • Personal financial statement (SBA Form 413) for each owner of 20% or more of the business; each general partner or managing member
    • Schedule of liabilities (SBA Form 2202)
    • Other information that may be requested:
      • Complete copy, including all schedules, of the most recent Federal income tax return for principals, general partners or managing member, and affiliates (see filing requirements for more information).
      • If the most recent Federal income tax return has not been filed, a year-end profit-and-loss statement and balance sheet for that tax year.
      • A current year-to-date profit-and-loss statement.
      • Additional Filing Requirements (SBA Form 1368) providing monthly sales figures.
    • See this comparison of a PPP v Economic Injury Disaster Loan.

    SBA Express Loans:

    These are loans for small business help through a lender, not the SBA. These loans will be approved or denied within 36 hours and funds available within 90 days; the SBA should be issuing some more information in the next few days. The approved uses of the funds are to keep your business operating, obtaining working capital to cover accounts payable, purchasing inventory, construction financing and more.

    Go here for more information.

     

    Small Business Interruption Loans (SBA 7(a) Loans):

    These loans are through a lender, not the SBA, and provide financial assistance to businesses with 500 or less employees. Businesses with 7(a) loans guaranteed between March 1 and June 30 may be eligible for loan forgiveness for maintaining payroll during that time period.

    Go here for more information.

    Faith Based Organizations

    Check out these FAQ and this Blog for some great information.

    CHURCH REOPENING FAQ

     

    Employee Retention Tax Credit:

    The CARES Act created an employee retention tax credit for employers who are closed, partially closed, or experiencing significant revenue losses because of COVID-19.

    Eligible Employers: Here is who is eligible:

    • Private employers and Non-profits carrying on a trade/business in 2020 that:
      • Have operations partially or fully suspended as a result of order from a governmental authority due to COVID-19; or
      • Experience a decline in gross receipts by more than 50% in a quarter compared to same quarter in 2019 (eligibility ends when gross receipts in a quarter exceed 80% compared to the same quarter in 2019).

    Note- not eligible if the employer received a PPP loan.

    Tax Credit Details: Speak with your CPA but our understanding is the employee retention tax credit is a 50% tax credit for the first $10,000 of compensation, including the employer portion of health benefits, for each eligible employee.  Only applies to wages paid after March 12, 2020 and before January 1, 2021. Compensation does not include sick pay or family leave for which the employer is reimbursed under the Families First Coronavirus Response Act.

    What Employees are Eligible?

    If you are an employer with 100+ employees:

    • full time employees who are: a) being paid, but b) not providing service because of either full or partial shutdown or a reduction in gross receipts.

    If you are an employer with 100 or less employees:

    • all employees, regardless of whether they are providing service.

    Note– employers may not claim the same employee for this credit and the Work Opportunity Tax Credit for the same period.  Also, employers may not claim the same wages for an employee under this credit and also under the employer credit in section 45S for FMLA.

    Sales Tax Relief:

    If you are a business which is required to collect and remit state and local sales tax and you are struggling to pay the full amount of the sales tax you collected in February, 2020, the Texas Comptroller is offering help in the form of short-term payment agreements and waivers of penalties and interest in many cases. Give the Comptroller a call at 800.252.8880 to learn about options.

    Individuals

    Tax Deadline Extension. The individual tax filing deadline has been extended to July 15th.

    Student Loans.  Payments and interest on federal student loans owned by the U.S. Department of Education are suspended. This includes Direct Loans, Federal Perkins Loans and Federal Family Education Loan Program loans held by the U.S. Department of Education. Check with your loan servicer to see if this impacts you. Go here for more information.

    Federally Backed Mortgages. Borrowers who have federally backed mortgages may submit a forbearance request if they are having financial hardship because of COVID-19.  The lender is required to grant the request for a period of up to 180 days and foreclosure is prohibited for a 60-day period which began on March 18, 2020.

    Charitable Deductions. Please continue supporting your favorite non-profit charities. The CARES Act provides an additional $300 deduction for charitable giving regardless of whether you itemize.  It also suspended limitations on charitable donations by individuals which were put in place in recent past.

    Unemployment Benefits. Texas Unemployment Insurance program pays benefits to people who have lost their jobs through no fault of their own and the Texas Workforce Commission (TWC) determines benefit eligibility based on past wages, the reason someone lost their job, and ongoing eligibility requirements. We truly hope you are still employed but if you are currently out of work, you can check see this guide to find out how to apply for unemployment benefits.  The TWC has waived the work search requirements and waived the 1-week waiting period for claimants affected by Covid-10. Employees will begin receiving benefits immediately after their application is approved.

    *Employers – For employers, you can see this guide for help with managing claims and other resources.  Employers that have their businesses shut down by order of a governmental entity may be able to obtain chargeback protection under the Texas Labor Code. Employers will need to provide a copy of the governmental order in response to the employee’s unemployment claim and ask for chargeback protection. Additionally, the employer may obtain chargeback protection if an employee was separated due to medical reasons.

    Shared Work Plan. TWC provides employers with an alternative to layoffs. From what we understand it will allow employees who have had their work hours reduced by at least 10% but not more than 40% supplement their wages with partial unemployment benefits. Go here for more information.

    Landlords and Tenants

     

    Residential Evictions. With one exception, there can be no residential eviction trial or hearing until after April 19th. You cannot evict or be evicted until April 19th.

    ERATH COUNTY RENT AND UTILITY ASSISTANCE:

    • If you are a United Cooperative Member go to H.O.P.E’s website for information.

    • If you are Not a United Cooperate Member see Erath County’s United Way for a relief fund to help with rent and utilities for laid off or furloughed workers. Call United way at 354.96.4429 or email for an application and details.

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