Here’s a guide for small businesses in need of federal aid under the CARES Act

Here’s a guide for small businesses in need of federal aid under the CARES Act
Many small businesses have been forced to close up shop in light of the pandemic. (Source: HNN)

HONOLULU, Hawaii (HawaiiNewsNow) - U.S. Senator Brian Schatz has released a resource guide aimed at helping the small businesses of Hawai’i navigate their way through getting federal loans and help from new programs under the coronavirus economic relief package.

The bipartisan $2 trillion CARES Act signed by President Trump on Friday is the largest aid package in American history.

“This new law will help Hawai‘i small businesses meet their payroll and provide people with paychecks for up to eight weeks,” said Senator Schatz, a member of the Senate Appropriations Committee. “As more federal help becomes available, we’ll continue to work to provide more information about how Hawai‘i families and businesses can access these new resources.”

The CARES Act provides relief for small businesses that have trouble covering payroll and operating expenses because of the COVID-19 pandemic.

The new law creates a small business loan program, called the “Paycheck Protection Program." It expands benefits and eligibility for SBA disaster loans, covers payments on existing SBA loans, and creates new tax credits to help cover the cost of paid leave and payroll.

Another portion of the CARES ACT creates a refundable payroll tax credit for businesses, large and small, that retain their employees during the COVID-19 crisis.

According to Sen. Schatz’s guide, “Employers are eligible if they have been fully or partially suspended as a result of a government order, or they experience a 50% reduction in quarterly receipts as a result of the crisis. For employers with 100 or fewer full-time employees, they may claim a credit for wages paid to all of their employees, up to $10,000 a person. For employers with more than 100 employees, they may claim a credit for those employees who are furloughed or face reduced hours as a result of the employer’s closure or economic hardship."

The guide also outlines other details for Payroll Tax Delay, Single Employer Pension Plans, debt relief and more.

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