Coronavirus Aid, Relief, and Economic Security (CARES) Act


Following up on our recent legislative updates email.  We had previously highlighted several key provisions in Congress’s bills aimed at relief for individuals and families.  A large part of Congress’s actions have also been measures targeted to assist the business community in dealing with the economic impact of the COVID-19 outbreak.

The Small Business Administration (SBA) and the Department of Treasury have begun to release information on initiatives that were newly created by the Coronavirus Aid, Relief, and Economic Security (CARES) Act.  As many of our clients are business owners, we wanted to bring attention to a few of the important elements of the programs that will be available for eligible businesses.

1. The Paycheck Protection Program

The Paycheck Protection Program (PPP) is a relief measure that consists of $350 billion in government-backed loans to help companies maintain payrolls through June 2020.  Eligible companies may be able to borrow up to 2.5 times average eligible monthly payrolls, up to $10 million.  These loans are scheduled to be on 10-year terms with interest rates not to exceed 4%.  There are provisions that allow all or part of the loan to be forgiven, depending on how much the business borrows and how it uses the funds. 

While application guidelines are still being finalized, according to the Department of the Treasury, applications for these loans will begin to be accepted for certain businesses starting April 3rd, 2020. 

2. Expansion of SBA’s Economic Injury Disaster Loan Program

In past instances where federally declared disasters have occurred, the SBA has offered relief assistance to businesses, homeowners and renters in those geographic regions.  Due to the widespread impact of COVID-19, all companies in the United States and U.S. territories can apply for a disaster loan through the Economic Injury Disaster Loan Program (EIDL). 

EIDL loans are determined on a case by case basis and can be in amounts of up to $2 million.  In addition, there is a $10,000 advance being offered to help businesses cover costs.  If the loan application is approved, the $10,000 advance can be received within days, and eligible applicants may not have to repay the advance. 

Businesses can apply to borrow through both EIDL and PPP initiatives.  There is also a possibility to refinance portions of EIDL loans in PPP funds, potentially making some of the funds forgivable. 

3. Updated Business Tax Provisions

The CARES Act makes some important tax relief policies for COVID-19 affected businesses.  There is an employee retention refundable tax credit offered for businesses that experienced certain levels of revenue declines.  The 50% tax credit applies to wages paid to workers during the pandemic, up to $10,000. 

Additionally, for businesses that do not receive loan forgiveness on a PPP loan, there is a program to defer payment of employer payroll taxes.  Deferred payments of these taxes can be spread and paid back over a two-year period. 

During this difficult time, we felt it prudent to bring attention to some of these recent initiatives that may provide relief to eligible businesses.  We’ve included additional sources for information in attachments and below.  We urge you to examine these and other resources regarding the various government funding programs that are being made available. 

In this difficult time, I’ve been comforted that instead of widespread panic and turmoil, we’ve witnessed compassion, kindness, and inspirational acts on a grand scale from our society.  As our healthcare and essential services workers continue their heroic work, we urge you to remember that we’re all in this together, and together we will get through it. 

We know that there is an abundance of negativity in the news.  However, we are also witnessing some of the best of humanity on display.  Please see some of these in the link below to help lift our spirits and remind us that we all stand with each other.

As always, please keep yourself and your families safe and healthy.  We are here for you should you have any questions, or just to chat.


Majid Kureshi

Farrukh Kazmi


Farrukh Kazmi

A & S Asset Management

1714 Memphis Street

Suite 110

Philadelphia, PA 19125

Farrukh Kazmi

Office: (856) 437-3215

Fax: (856) 437-3215

Mobile: (856) 630-0691

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