The CARES Act and what it means for you

We have a guest blogger on Direct Talk today - David McIntee, CPA

The CARES Act passed Friday, offering much needed-relief to America’s small businesses. Here is an excellent summary of key provisions by Guest Blogger, David McIntee, CPA.

CORONAVIRUS AID, RELIEF, AND ECONOMIC SECURITY ACT

Paycheck Protection Program

The CARES Act was signed into law on Friday, March 27, 2020. Many details remain to be provided by the various federal agencies charged with managing the disbursement of the aid package and benefits. The bill is 880 pages long and contains many provisions impacting many individuals and businesses across many industries. It’s complicated, contains ambiguities that will only be clarified through regulation.

ELIGIBILITY FOR BUSINESS ASSISTANCE

The Paycheck Protection Program

An eligible businesses and nonprofit organization with not more than 500 employees, or that otherwise qualifies as a “small business” under the SBA size standard. “Business” includes sole proprietorships, independent contractors and self-employed individuals.

Loan Amount

The loan amount is the lesser of:

* 2.5x average monthly payroll costs for the 1-year period prior to the loan date,

* $10 million (maximum loan amount)

* Payroll costs include: