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Stimulus package forgivable loan offered to small business owners in the US

(Partner Content) URGENT: Do you need help filing for the stimulus package forgivable loan which is being dealt with on a first-come-first-served basis?

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The experts at Grant Kaplan have told us that you can receive a stimulus grant for $10,000 as a forgivable loan if you make your application through the SBA, which is the small business administration. This is the economic injury disaster loan from the small business administration. This is the stimulus loan, but in reality, the stimulus bill makes this a stimulus grant. Therefore, this is like free money to small business owners, independent contractors, and sole proprietors.

How you can claim the grant

For all non-immigrant visa holders, including L-1, E-2, all Green Card holders, and United States citizens, this will be a refundable loan or may otherwise be deemed to be a public charge.

There is urgent and available funding for business and sole proprietors, as well as independent contractors. This is on a first-come-first-served basis until the funds are depleted and therefore needs to be filed for as soon as possible.

You will need to have filed a tax return at least and be able to show that you have been operating.

FAQs and answers which will assist you

When can I apply?

Starting 3 April 2020, small businesses and sole proprietorships can apply for and receive loans to cover their payroll and other certain expenses through existing SBA lenders.

Who can apply? 

All businesses — including nonprofits, veterans organisations, tribal business concerns, sole proprietorships, self-employed individuals, and independent contractors — with 500 or fewer employees can apply.

What do I need to apply?

You will need to complete the Paycheck Protection Program loan application and submit the application with the required documentation to an approved lender that is available to process your application by 30 June 2020.

What other documents will I need to include in my application? 

You will need to provide your lender with payroll documentation.

Do I need to first look for other funds before applying to this programme? 

No. Grant Kaplan is waiving the usual SBA requirement that you try to obtain some or all of the loan funds from other sources.

How long will this programme last? 

Although the programme is open until 30 June 2020, you are encouraged to apply as quickly as you can because there is a funding cap and lenders need time to process your loan.

How many loans can I take out under this programme? 

Only one.

What can I use these loans for? 

You should use the proceeds from these loans on your:

  • Payroll costs, including benefits
  • Interest on mortgage obligations, incurred before 15 February 2020
  • Rent, under lease agreements in force before 15 February 2020
  • Utilities, for which service began before 15 February 2020.

What counts as payroll costs? 

Payroll costs include:

  • Salary, wages, commissions, or tips (capped at $100,000 on an annualized basis for each employee)
  • Employee benefits including costs for vacation, parental, family, medical, or sick leave; allowance for separation or dismissal; payments required for the provisions of group health care benefits including insurance premiums; and payment of any retirement benefit
  • State and local taxes assessed on compensation
  • For a sole proprietor or independent contractor: wages, commissions, income, or net earnings from self-employment, capped at $100,000 on an annualised basis for each employee.

How large can my loan be? 

Loans can be for up to two months of your average monthly payroll costs from the last year plus an additional 25% of that amount. That amount is subject to a $10 million cap. If you are a seasonal or new business, you will use different applicable time periods for your calculation. Payroll costs will be capped at $100,000 annualised for each employee.

How much of my loan will be forgiven? 

You will owe money when your loan is due if you use the loan amount for anything other than payroll costs, mortgage interest, rent, and utilities payments over the eight weeks after getting the loan. Due to likely high subscription, it is anticipated that not more than 25% of the forgiven amount may be for non-payroll costs.

You will also owe money if you do not maintain your staff and payroll.

  • Number of staff: Your loan forgiveness will be reduced if you decrease your full-time employee headcount.
  • Level of payroll: Your loan forgiveness will also be reduced if you decrease salaries and wages by more than 25% for any employee that made less than $100,000 annualised in 2019.
  • Re-hiring: You have until 30 June 2020 to restore your full-time employment and salary levels for any changes made between 15 February 2020 and 26 April 2020.

When is my loan due? 

In two years.

Can I pay my loan earlier than two years? 

Yes. There are no prepayment penalties or fees.

Do I need to pledge any collateral for these loans? 

No. No collateral is required.

Do I need to personally guarantee this loan? 

No. There is no personal guarantee requirement. However, if the proceeds are used for fraudulent purposes, the U.S. government will pursue criminal charges against you.

What do I need to certify? 

As part of your application, you need to certify in good faith that:

  • Current economic uncertainty makes the loan necessary to support your ongoing operations.
  • The funds will be used to retain workers and maintain payroll or to make mortgage, lease, and utility payments.
  • You have not and will not receive another loan under this programme.
  • You will provide to the lender documentation that verifies the number of full-time equivalent employees on payroll and the dollar amounts of payroll costs, covered mortgage interest payments, covered rent payments, and covered utilities for the eight weeks after getting this loan.
  • Loan forgiveness will be provided for the sum of documented payroll costs, covered mortgage interest payments, covered rent payments, and covered utilities. Due to likely high subscription, it is anticipated that not more than 25% of the forgiven amount may be for non-payroll costs.
  • All the information you provided in your application and in all supporting documents and forms.

To get assistance with any of these, or any other immigration concerns or requests, please contact Grant Kaplan. Grant Kaplan provides people with help on a variety of immigration issues and is aware of the implications the unprecedented lockdown is having on US immigration.

Telephone: +1 561 3478440