In the article we posted previously, we shared a few industry-specific relief funds with you. But what about the vast population of small businesses owners and sole proprietors, including freelancers and sub-contractors, in general?
When the PPP funds ran out last month, many business owners panicked. While the majority of you may not have counted PPP as the ultimate solution to the distress caused by the COVID-19 crisis, having a major relief program ran out in a blink of an eye was never a good experience.
That is why we decided to put together a short guide of available COVID Relief Programs for small business owners, single partner LLCs and sole proprietors in the state of MO and KS, including a detailed look into the 2nd PPP application cycle.
#1 Paycheck Protection Program (PPP)
When the initial PPP guidelines came out, many business owners suspected that funds were more likely to end up with mid-sized businesses. But according to Forbes, smaller businesses and newer businesses may be more advantageous in receiving the relief funds.
The new bill provides $30 billion specifically for community lenders, small banks and credit unions. An additional $30 billion will be allocated for medium-sized banks and credit unions. - Forbes
According to the guideline released by SBA, PPP can provide up to $10 million per small business to keep the company afloat throughout this challenging time. Any business with less than 500 employees qualifies for the program, or, if you are in the hotel and/or food industry, you may still qualify even if you have over 500 employees.
While this program will fund a maximum of 2.5 times the average monthly payroll costs (no more than 100,000) calculated according to the previous calendar year, it is only applicable to salary costs, and does not take into consideration payments made to 1099s or vendors you’ve hired.
To find out more about the PPP initiatives, or to apply for the loan, visit the correspondent page on SBA’s website.
#2 Pandemic Unemployment Assistance (PUA)
In a press release published by the Missouri Department of Labor and Industrial Relations, solo business owners, freelancers and other self-employed “gig workers” are encouraged to apply for the new PUA program even if they are not eligible for the regular unemployment benefits.
“Self-employed individuals filing unemployment claims should indicate “none” when asked for states in which they have worked, unless they have worked for an employer in the last 18 months. - MO Dept of Labor”
The PUA program will release an additional weekly payment between $133 - $300 on top of the regular amount of $600 per week federal supplement. That will round to a maximum payout of $3600 per month to self-employed individuals and a minimum of $2800+
Of course, the final amount is determined according to your tax return of the previous years. If you haven’t completed your 2019 tax return, submit materials from your 2018 return including Schedule C, E, F or SE with additional proof of income such as terms of payments, business license, invoice copies or Form 1099 issued by your clients.
To find more information about PUA as well as other unemployment information and resources, visit the official MO COVID-19 Information Hub.
#3 KCMO Small Business Relief Fund
The KCMO Small Business Relief Fund is designed to relieve small businesses within the city limits of Kansas City Missouri from the financial distress caused by operational and other business expenses incurred during the COVID-19 crisis.
“The Fund allows for low interest rate loans, deferred payments for the first 6-12 months, and extended amortization periods of up to five years. There are no minimum credit score and flexible collateral requirements. - KCEDC”
If your business is not a home-based business, and was deemed “non-essential” and/or was disproportionately impacted by the government-issued public health restrictions, you are eligible for the KCMO Small Business Relief Fund.
Eligible businesses for this loan may receive a loan up to $25,000 with a term of up to 5 years, whereas there would be 0% interest and deferred payments for the first 6-12 months. The application process is completely online via KCEDC’s digital system.