How to Apply Targeted EIDL Advance Grant – There are many small businesses that have been affected because of Covid-19. Those particular businesses are directly eligible for a Targeted EIDL Advance Grant that is offering up to $10,000. They also offer an additional $5,000 Targeted EIDL Advance Grant. The best thing about these grants is that they are not like any loan so you do not have to repay them back. The SBA also encourages all the eligible companies to apply for the grant. However, to be eligible the company needs to meet the eligibility requirements and can apply for the Economic Injury Disaster Loan also known as EIDL in short. Another thing is that you do not have to accept the loan to receive the grant from them. Go through the article to know more about the EIDL Advance Grant.
Highlights of this Post
Targeted eidl advance grant
The CARES Act was passed on 27th March, 2020 that includes a grant for those people who are applying for a Targeted EIDL Advance Grant that is offering up to $10,000. However, after a period SBA declared that these grants will be awarded at $1000 to each employee. Moreover, the grants were exhausted before all the eligible organizations were able to receive them.
After that the Economic Assistance Act was passed on the 27th December, 2020 and it also included the funding for targeted EIDL grants. It allowed a few business owners to receive the full amount that is a $10,000 small business grant. On March 11, 2021 the US bailout plan was signed and it offered $10 billion grants and an additional $5 billion was also provided to ten or few employees who have suffered because of any economic impact.
Eligibility Requirements for Targeted EIDL Advance Grant
To be eligible for the $10,000 Target EIDL Advance Grant, a company must meet the requirements that are stated below:
- Do not employ more than 300 employees.
- Have suffered an economic loss by 30 percent or more.
- Belong to a low income community.
Apart from that the company also needs to qualify as a qualifying entity under the CARES Law:
- The company has been affected directly by Covid-19
- The store must have been operating since January 31, 2020.
- Must be a private non-profit or small agricultural cooperative.
- Must is also a small cooperative ESOP parent company consisting of less than 500 employees.
- A person must be operating as a sole proprietor with or without the employees or working as an independent contractor.
An economic loss can be defined as the amount that has affected the company’s gross revenues decreased in an 8 week period that is between March 2 , 2021 to December 17,2022. The SBA has also developed their own formula for seasonal business. The SBA has designed an online tool that helps the borrowers to understand if they belong from the low income area. However, it is also important to note that the business must belong to a low income community to qualify for the grant. The SBA also encourages prospective applications to review so that they can meet the eligibility requirement as set by them.
Sba opens targeted eidl advance grant
It is always important to keep your corporate tax records organization up to date so that you can easily apply for the grant by providing the qualification. In the FAQs, SBA clearly states that the applicants that have met the low income community criteria need to provide gross monthly earnings for January 2019 by submitting the recent month to date such as salaries, profits and monthly earnings received.
It helps in confirming the reduction in the revenue. Apart from that you also need to submit an IRS Form 4506-T that allows the SBA to request the tax information of the applicants. But remember that tax verification procedures and requirements for corporations in US territories might differ. The SBA also recommended completing the tax return of the applicants as soon as possible.
It is also important to submit the company’s monthly gross income for every month since January 2019 to the last month to date. The information is mainly used to determine whether your business is eligible for the grant or not. So, if your company’s reduction is more than 30 percent in that 8 week period then you are eligible for the grant.
What Do You Mean By The New $5000 Additional Grant?
The American Rescue Plan consists of the $5 billion in funding for the $5,000 in Supplemental Targeted Advances grants for those businesses that were hit hard. It is stated by the legislation that the grants are only available to those businesses that:
- Employ not more than 10 employees.
- Suffered an economic loss by 50 percent or more.
This particular grant is also in addition to the $10,000 targeted EIDL advance that is offered. The SBA mainly reaches out to those small business owners who have directly applied for the targeted advance grant. SBA will also look out if those business owners are eligible for the additional grant.
Procedure To Apply For sba targeted eidl advance grant application
When you have applied for a Economic Injury Disaster Loan earlier then you will be receiving an email invitation that invites you to apply for the Target grant and scholarship. When you have not applied for EIDL, you can simply visit SBA. go and submit your application.
When your company is eligible for the EIDL Advance Grant you will be invited to apply for it. However, it is not mandatory to accept the EIDL loan to receive a grant even if you qualify. Another important thing is that you need to check your spam folders for emails from the SBA and be aware of the scams. SBA will directly contact the application using email that will provide all the information related to documentation and eligibility.
SBA also advises to make people aware that all the mails are sent from the official government email consisting of the extension@sba.gov. So, you need to be aware not to send any confidential information to any extension that does not end with @sba.gov. But remember any previously received target EIDL advance grant will directly be deducted from the $10,000 EIDL grant you will be receiving.
Do They Forgive EIDL Loans?
You might be wondering whether the EIDL loans can be forgiven or not. The short answer might be Yes or No. But it will not be much helpful to you, so it is better to provide you with a longer explanation.
The current EIDL program is divided into two parts loans and grants:
EIDL Grants
The EIDL grants are slightly different in comparison to the EIDL loans. They are mainly offered to the companies offering $1,000 per employee that is up to 10 employees. The capping limit is at $10,000 and you do not need to make any repayments because it not any type of loan.
EIDL Loans
EIDL Loans can be up to $2 million and are not unforgivable and you need to pay them back. Remember that EIDL loans and grants are two different things. But there is one exception that is when the company has already obtained an EIDL and has applied for a forgivable Paycheck Protection Program (PPP) loan that is in between January 31, 2020 to April 3, 2020 then the EIDL might get waived off.
How To Reapply or Get a Second EIDL Loan?
It is recommended by SBA not to reapply as it can result in a notice that will be stating that your application is a duplicate one. But do not worry as you will be eligible for a larger EIDL loan. Recently SBA has increased the amount of loans for the companies that received the EIDL loans before April, 2021. They are providing an additional loan up to $500,000 for your business when it has faced a total of 24 months economic damage.
You will also be receiving an email from the SBA where they ask you to increase your loan amount. But do not worry if your company has been rejected for the EIDL loan as you can also apply for reconsideration. All you need to do is submit your required for reconsideration to [email protected]. You can also mail to the US Small Business Administration Disaster Assistance Processing and Disbursement Center 14925 Kingsport Road Fort Worth, Texas 76155. The SBA also helps you by providing the application number and any information that might help you to know the reason why it is declined.
Covid-19 targeted eidl advance grant
A released update on guidance on loan is provided by the US Small Business Administration (SBA). They have also provided detailed guidance on Targeted EIDL Advance Grants and appeal requests during the Covid-19 Economic Injury Disaster Loans (EIDL) program.
The previous deadline was December 31 and it is strongly recommended by SBA that companies that are seeking for Supplemental Targeted Advance must submit the application before December 10. Also remember that the agency cannot process the Supplement Targeted Advance application after the deadline day is crossed that is December 31. Thus, it means that the applications received to this date will not be reviewed and will be directly rejected. However, in contrast the EIDL and Targeted EIDL Advance grant applications that are received after December 31 might get processed if they have extra funds left.
The SBA already stated that they will be accepting and reviewing the request to reconsiderations and appeals that are received before the deadline. But remember that the reconsideration or appeal must be filed within the six months from the date of reconsideration denial. 30 days from the date of refusal might be reconsidered when there is funding left.
The COVID-19 EIDL Programs are mainly designed to offer access to finances to the small business so that they recover from the economic loss that is caused during the Covid-19 pandemic. There are mainly three types of funding:
- A targeted advance is available to the recipients of targeted EIDL advance grants who are having 10 or fewer employees. It is also important that the firm has experienced a 50 percent loss because of COVID-19. The advance payment cap was set to $5,000 that means that the company has faced a total cap of $15,000 when they receive both types of advance payments grants from them. However, these advances are not any kind of loan so you do not have to pay them back.
- Another targeted EIDL advance grants that offers up to $10,000 to those businesses that are located in low income communities. It must have 300 employees or few and have experienced a loss of 30 percent because of COVID-19.
- COVID-19 EIDL loans are also offered for 30 year terms with a fixed interest rate of 3.75 percent for small businesses. It also includes independent contractors, sole proprietors and charging 2.75 % interest rates from non-profit organizations. The loan proceeds are used for normal working capital and operating expenses, it also includes debt service, equipment purchased and payroll. However, loan payments are deferred for the first two years along with interest accrues; the interest and principal amount is paid over the last 28 years remaining of the loan.
The guidance has been issued by the SBA and they have also announced that there will be some major changes to the EIDL grant program. It is mainly done to make money more accessible to the companies. The best changes that were made were when the EIDL loan limit was increased from $500,000 to $2 million.
Are the Targetable EIDL Advance Grant Taxable?
There is good news as the legislation has already clarified that EIDL grants are not taxable by the federal government. So, the companies that are receiving the EIDL grants are not denied any tax deduction for qualifying expenses that are paid using the funds. But remember that the targeted EIDL advances are also not used by the PPP for loan forgiveness. To get more information you can contact any tax professional and resolve your queries. You can also check out this article about Top 10 College Scholarship Organizations.
Conclusion
I hope the article has provided you with all the information on How to Apply Targeted EIDL Advance Grant. Government backed loans and grants for small businesses are provided as relief to recover from Covid-19 pandemic. There are a lot of small businesses who have not received the Supplemental EIDL Advance or the Targeted EIDL Advance grant. The assistance can help with the financial need of the business and can recover from the losses. When you are a small business owner and looking for a loan then you can apply for Targeted EIDL Advance Grant. You can also find out the small business grant online using Lantern by SoFi. All you need to do is fill up a simple form and check out your financial options from a long list of lenders and you will be getting your loan within 24 hours. If you know someone who is looking for such a loan please share this article with them. Thanks for reading the article. I hope you have a great day ahead!
Frequently Asked Questions – FAQs
We are going to answer some of the frequently asked questions on Targeted EIDL Advance Grant. Go through the question and answers to gain additional knowledge on the topic.
What is a Targeted EIDL Advance Grant?
The Targeted EIDL Advance Grant is offered to those small businesses with $10,000. Apart from that they also offer an additional Targeted EIDL Advance Grant of $5,000. offered to small business faced lot of losses during covid 19 period.
Does my company qualify for the $10,000 Targeted EIDL Advance Grant?
To be eligible for the $10,000 Target EIDL Advance Grant, your company must not have more than 300 employees. Your company has also suffered a 30 percent loss because of Covid-19 and it belongs to a low income community.
Who can apply for the $5,000 Additional Grant?
The businesses that were hit hard by Covid-19 can apply for the $5,000 Additional Grant. However, the grant is only available to those businesses that employ not more than 10 employees and have suffered an economic loss by 50 percent.
What are EIDL loans?
You can get up to $2 million from EIDL loans but remember you need to pay them back as these loans are not forgivable. But remember that EIDL loans and grants are different from each other.
How to apply for a Targeted EIDL Advance Grant?
If you have not applied for EIDL, you can directly visit the SBA website and submit your application. But remember your company must be eligible for the grant and meet the guidelines as stated by SBA. SBA will also directly contact you with the application with documentation and eligibility requirements.
