You are eligible for tax-free money if you owned a business in 2020
Fri, 02/05/2021 - 5:43pm admin
—Farmers, sole proprietors, at-home businesses are also eligible for PPP
Marcie Klomp ~ News Editor email@example.com
HOWARD COUNTY - This is not a scam from your great-great-aunt’s solicitor in England trying to give you $64 million in U.S. dollars.
It is from your Uncle Sam, the U.S. government, who wants to give your business tax-free money for surviving 2020. The funds are through the PPP or Paycheck Protection Program.
A large percentage of businesses lost revenue due to being closed or having fewer customers since the coronavirus pandemic began in early 2020. It has been a hardship on most.
Through the CARES Act businesses were encouraged to sign up for PPP. Although it was set in motion by the government, filling out the paperwork was relatively easy for lenders when helping companies.
Director of Howard County Business & Tourism Jason Passmore said his office, along with the area banks, tried to get in touch with all business owners for the first round. “Our biggest hurdle was owners not believing it was free and figuring the paperwork was extensive. Neither are true.” In the end, he figures over 50% of Howard County businesses received PPP.
He added, “Our business owners owe it to their businesses to apply. If 2020 proved one thing, we don’t know what’s ahead. If you can put money to good use, you owe it to your business, employees and community to do it.”
A second draw of PPP was opened on Jan. 13, with the first draw resuming on Jan. 11 for businesses that did not apply or if they returned some or all of PPP money in 2020.
Passmore noted this is another great opportunity for local businesses.
It should be noted, these grants have to go through a lending institution.
First Time Draw
For those able to apply for a first time draw, business owners need to prove an average salary for a month. The amount they receive is that figure times 2.5. It can be used for salaries, mortgage interest, rent, utilities and more.
The only difference is for hospitality businesses, such as restaurants, bars and lodging, which will get 3.5 times the average monthly salary. They get more because many of them were shut down for an extended period of time by state governments in 2020.
For the second go-around, businesses can re-apply even if they received funds from the first draw. Those businesses do have to prove they lost 25% of income in one quarter of 2020 compared with the same quarter in 2019.
In addition, this time, businesses can take 8-24 weeks to show they spent their money on eligible expenses.
The whole point of the program is to allow businesses to keep their staff employed.
One good thing about the second draw is everything the governing bodies learned from the first draw.
Now farmers, sole proprietors and at-home businesses can more easily prove they lost money as well.
Although the PPP application is good through March 31, 2021, Passmore predicts the deadline will get extended.
Iowa Restaurant and Bar Relief Grant Program
This program is an extension of the Iowa Small Business Relief Grant Program.
These businesses have to prove they lost at least 15% of income in the second and third quarters of 2020 (April 1-Sept. 30) compared with the same quarters in 2019.
There will be different tier levels based on how big of a percentage they lost. At this time, maximum ranges are from $10,000-$25,000.
This grant has an online application that started on Feb. 1 and will continue until Feb. 15 at 5 p.m. It is a short window of opportunity, but this application will also be fairly easy to navigate.
If you have any questions, call Howard County Business & Tourism at 563-547-3434 or call a lender of your choice.