The effects of the pandemic perhaps had their strongest impact on small businesses nationwide. The Wall Street Journal recently reported that over 200,000 small businesses in the U.S. were forced to close their doors during the first year of COVID-19. While this seems like an incredibly high number, it’s actually fewer than many economists were initially predicting. And as for the businesses that were fortunate enough to stay open, most of them were left anything but unscathed.
While businesses in every industry were forced to cut integral staff, pivot to alternative services, and watch profits drop due to strict social distancing mandates, the Small Business Administration now has proposed a grant of $5 billion under the 2021 Supplemental Targeted Advances Program. These grants, part of President Biden’s Coronavirus Stimulus Law, are geared directly toward helping small business owners who were substantially impacted by the pandemic.
SD Associates is a full-service CPA advisory firm that works as a small business financial advisor for companies ranging in various industries. Below, we’ve compiled everything you need to know about the SBA Grant 2021, including how to apply for the SBA Grant and who exactly is eligible for the SBA Grant.
How much is the SBA Grant?
This program will provide a $5,000 payment with no requirements of being paid back. Many businesses that were affected have already received a payment of up to $10,000 from the Economic Injury Disaster Loans (EIDL). For those business owners, they are still eligible for this grant as long as they meet the required criteria. The amount was determined as an estimated cost to replenish fallen resources and get these businesses back in a positive direction.
Who is Eligible for the SBA Grant?
The SBA Administrator, Isabella Casillas Guzman, said that “we’ve found that the smallest businesses — the majority of which are minority-owned — are hurting the most.” For eligibility, small businesses must have 10 employees or fewer and be located in low-income areas. Additionally, applicants must provide tangible evidence that their business suffered legitimate economic losses during the coronavirus pandemic. Specifically, applicants must have suffered a loss greater than 50% compared to the previous year over an eight-week period.
How to Apply for the SBA Grant?
The SBA claims that they will be accepting applications until the funds provided under Biden’s stimulus law run out. With the program targeting an expected 1 million small businesses that were significantly impacted, the SBA will be contacting businesses that are eligible and processing applications on a first-come, first-served basis. Prospective applicants can apply online through the SBA website and fill out the necessary forms associated with the grant application.
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