Everyone has been affected by the outbreak of the coronavirus in some way, but small businesses are among those hit the hardest. The financial burden of the coronavirus pandemic is likely weighing heavily on your mind. The good news is, there are lots of financial resources for auto recon available to help you maintain your business’ financial health.
Here at Mobile Tech RX we want you to know that you are not alone and help is at hand. Our main priority is to do whatever we can to ensure your auto recon business survives and thrives—now and always.
Check here to see a comprehensive list of the COVID-19 relief resources for small businesses by state. Read on and learn more about how the financial resources for auto recon we outline below can help your auto recon business survive coronavirus.
Up-to-Date Business Resources for COVID-19
Having the most up-to-date information on the pandemic is a good place to start. See our list of resources for auto recon businesses. It’s also worth referencing the CDC and their guidelines on how businesses can plan, prepare, and respond to COVID-19.
How the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) Could Help You and Your Business
The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) is a $2 trillion economic relief package that helps businesses in the United States suffering from the financial impact of COVID-19.
Part of this act is the new Paycheck Protection Program (PPP), which is backed by the U.S. Small Business Administration (SBA). This program is intended to help small businesses pay for certain expenses. These expenses can include loans taken to keep employees on payroll, eight weeks of cash flow, rent, and utilities, in addition to 2.5x average monthly payroll.
Businesses with less than 500 employees are eligible for this new loan, even if they can obtain credit elsewhere. The law covers up to $350 billion for this loan program, meaning that you should apply as soon as possible.
The SBA has a search option on its website where you can locate a lender near you and start the application process, now.
Disaster Assistance Loans from the U.S. Small Business Administration
Temporary loss of revenue is one of the biggest financial strains on auto recon businesses as you navigate the challenges of COVID-19. The U.S. Small Business Administration (SBA) has comprehensive guidance on how businesses can access capital during the crisis.
All small business owners in the U.S. are currently eligible to apply for low-interest loans due to coronavirus. Through SBA Disaster Loans, you can pay fixed debts, payroll, accounts payable, and other bills that can’t be paid because of the disaster’s impact. The interest rate on these loans is 3.75%.
You can also apply now for the Economic Injury Disaster Loan, to get an advance of up to $10,000. The application takes around two hours and you are only eligible if you do not have credit available elsewhere. Funds will be made available within three days of a successful application, and this loan advance will not have to be repaid.
For business owners who already have a relationship with an SBA Express Lender, the SBA’s Express Bridge Pilot Program allows them to quickly access up to $25,00 in the interim period while they apply for other loans.
In addition to loans, the SBA Debt Relief program will cover the cost of interest on any current or new 7 (a) loans. The 7(a) Loan Guarantee program is the basic SBA loan program provided to lenders. This makes lenders more willing to lend money to small businesses with weaknesses in their loan applications. In other words, the SBA acts as your guarantor in order for you to be able to secure a loan of up to $2 million.
State-Specific Initiatives to Help Local Small Businesses
The SBA’s Office of Disaster Assistance can help business owners apply for financial assistance available in their state. The website has a list of states where disaster assistance is available, which the SBA can then request on your behalf.
If your state is not yet listed, you can still prepare the information required so that you’re ready if it does.
As always, it’s important to be wise when taking on additional debt. The interest rates on loans can quickly add up. You need to be sure you can manage the repayments and are not going to end up further in debt. For more in-depth help on whether applying for a loan will work for your business, see our article on financial planning in times of uncertainty.
Small Business Grants
Facebook is offering $100 million in cash grants and ad credits for up to 30,000 eligible small businesses. Business owners can sign up for updates on when and how to apply for grants on the website.
For those located in Seattle, Amazon has created a $5 million Neighborhood Small Business Relief Fund. This fund will provide cash grants to local small businesses that will be impacted by fewer customers due to COVID-19. The fund is intended to support small businesses with fewer than 50 employees or less than $7 million in annual revenue.
Unlike a loan, you are not required to pay a grant back. A grant is typically a one-off, cash gift. A loan will have to be paid back over a set time period and normally with interest.
Unemployment Insurance Flexibilities
The Employment and Training Administration announced that states have flexibility to provide unemployment insurance benefits to those affected by COVID-19. For example, if you had to close your auto recon shop preventing your employees from coming to work, federal law is allowing states to pay benefits. Note that an employee does not have to quit in order to receive the benefits due to the outbreak.
Check your state’s unemployment insurance program and find further information on how the benefits apply on the website. You can also learn how to file for unemployment insurance benefits, here.
Tax Relief
A section of the IRS has been set up to specifically help those affected by coronavirus. At present, the deadlines to file and pay federal income taxes have been extended to July 15, 2020.
Economic impact payments will begin in the next three weeks and will be distributed automatically to most people. Any individual with an income of $75,000 or less or married couples with a joint income of $150,000, is eligible to receive the full payment. If you filed a tax return in 2018 or 2019, you will automatically receive an economic impact payment. These payments will amount to $1,200 for individuals or $2,400 for married couples and up to $500 for each qualifying child.
The Coronavirus Tax Relief website will be updated when new information becomes available. The IRS asks that you check the website instead of calling.
Free Financial Planning and Advice
The future may seem very uncertain right now, but looking ahead is the best way to prepare. See our tips for financial planning in times of uncertainty. You can also take advantage of finance professionals offering their expertise and advice for free.
SCORE mentors can also help with accessing funding, financial planning, and next steps if you’re denied a loan.
For more information on how to protect your auto recon business during this time, visit our COVID-19 Resources Page. Please let us know if there’s anything we can do to support you and your business during this time.