April 30, 2020 (Updated)
Webinar: Economic Relief Available To Businesses Impacted by COVID-19 (Added 4/3/2020)
This recording of a webinar given by Rich May, P.C. goes into details of economic relief available for businesses impacted by COVID-19, including the differences between the Paycheck Protection Program and Economic Injury Disaster Loans, who qualifies and how to apply, what loan amounts will be forgivable, and how these loans intersect with other types of relief available under the CARES Act and Families First Coronavirus Relief Act. Download presentation slides.
The State of Massachusetts COVID-19 resources, general:
To view the latest updates from Governor Baker, and on current case counts in MA and US.
State of Massachusetts COVID-19 resources and Guidance for small businesses:
To view the latest announcement from the State Government regarding small businesses.
State of Massachusetts Work Share Program:
The WorkShare program is a tool to help employers avoid layoffs during a downturn. Employers can divide available work between affected employees instead of laying off workers. It allows employees to receive partial unemployment insurance benefits while working reduced hours. Click here to go to the online portal to apply for WorkShare, a smart alternative to layoffs, helping companies keep valuable workers.
State of Massachusetts Rapid Response Program:
Partner up with Rapid Response Team to minimize the possibility of layoffs and keep a skilled workforce engaged.
State of Massachusetts Unemployment and Workers’ Compensation Programs:
For information on Unemployment Insurance benefits, waivers of certain requirements (including the one-week waiting period for Unemployment Insurance), and workers’ compensation claims:
State of Massachusetts emotional health and well-being resources:
For information and tips on reducing stress and combating isolation during the COVID-19 outbreak.
Order extending the registrations of certain licensed professionals:
Massachusetts has granted relief to licensed professionals who must otherwise renew their licenses during the coronavirus emergency. Specifically, occupational or professional licenses of individuals that are in good standing shall be extended for 90 days after the end of the public health emergency. Read the order here.
Non-Essential Business Closings Order
On March 23, 2020, Governor Baker issued an order requiring all businesses and organizations that do not provide “COVID-19 Essential Services” to close their physical workplaces and facilities to workers, customers and the public as of Tuesday, March 24 at noon until Tuesday, April 7 at noon. The list of COVID-19 Essential Services can be found here, and includes electric power generation, transmission and distribution, natural gas and propane transmission and distribution, and maintenance of related facilities. The order prohibits gatherings of more than 10 people except in connection with businesses delivering COVID-19 Essential Services.
Emergency Child Care Programs
Starting March 23, 2020, all early education centers and childcare providers in Massachusetts have been ordered to close in order to mitigate the spread of COVID-19. However, a certain number of childcare facilities will receive the designation of Exempt Emergency Child Care Programs in order to provide childcare primarily to families who work to maintain the health, safety, and welfare of Massachusetts residents. Details on this program can be found here.
Massachusetts Legislature passes bill halting all residential and small business evictions and foreclosures
On Thursday, April 16, 2020, the Massachusetts legislature passed bill H.4647 which once enacted will put a temporary moratorium on evictions and foreclosures in Massachusetts in response to the COVID-19 (coronavirus) declaration of emergency.
The new bill stops landlords from initiating or conducting “non-essential” evictions, and also halts presently pending evictions by staying their deadlines. “Non-essential” evictions include those for non-payment of rent. Landlords also may not impose late fees if the tenant provides timely documentation that the nonpayment was due to “a financial impact from COVID-19.” However, landlords may still conduct evictions arising from health and safety violations. This reprieve is only temporary and tenants are not relieved of their obligations, so evictions and collection actions for nonpayment could commence after the law expires (see below).
This temporary eviction prohibition applies to both residential tenancies and those involving “small business premises units.” These are properties occupied by any commercial tenant that (i) does not operate in multiple states or internationally, (ii) is not publicly traded, and (iii) has fewer than 150 full-time equivalent employees. Landlords may still terminate tenancies of small business premises units and may send notices to quit, but will not be able to move forward with the eviction process while the law is in force.
The bill’s moratorium on foreclosures only applies to residential properties. Lenders, mortgagees, and any person acting in the name of a mortgagee cannot initiate a residential foreclosure action where the property is the principal residence of the borrower. Pending residential foreclosures are also stayed. The only exception is if the residential property is vacant or abandoned, in which case an eviction may be commenced or continue to proceed.
Similarly, mortgage holders and creditors are required to grant forbearances to borrowers holding mortgages on residential property. All the borrower must do is submit a forbearance request with a certification that the borrower “has experienced a financial impact from COVID-19.” The forbearance will be for a maximum of 180 days and no fees, penalties, or interest may apply beyond what would otherwise be included in the ordinary course if payments had been made on time and in full.
Lessons Learned from a PPP Recipient - Case Study (Added 4/30/2020)
The following advice is shared by the Chief Financial Officer of three construction businesses who was ultimately successful in receiving loans within 10 days of application for each of those businesses. The key to success was understanding in advance what would be asked for, starting to prepare it early and managing communication. Download case study.
General Federal resources for small businesses:
Health and government officials are working together to maintain the safety, security, and health of the American people. Small businesses are encouraged to do their part to keep their employees, customers, and themselves healthy.
Federal small businesses Disaster Loan Assistance Program:
Economic Injury Disaster Loans from the U.S. Small Business Administration (SBA) of up to $2 million dollars are now available for small businesses and nonprofits in Massachusetts that have been negatively financially impacted by COVID-19. Need to apply for a small business Disaster Loan? Start here.
Families First Coronavirus Response Act (the “Act”)
Treasury, IRS and Labor announce plan to implement Coronavirus-related paid leave for workers and tax credits for small and midsize businesses to swiftly recover the cost of providing Coronavirus-related leave. Read Newswire, IR 2020-57, which clarifies what benefits are provided and how they will be fully subsidized through a refundable payroll tax credit under the Act (and a similar credit for self-employed individuals).
Federal Legislative Relief Efforts
On April 23, 2020, signed a bill that added more funding for the CARES Act — the Coronavirus Aid, Relief, and Economic Security Act. This will allow more qualifying businesses to apply for fee-free loans of up to $10 million that could help cover payroll, employee salaries, mortgages, rent and some other debt obligations. The portion of the loan used by small businesses to cover their payrolls could be forgiven if businesses retain their employees through the end of June 30, 2020. Additionally, the CARES bill would defer the payment of employer-side payroll taxes until 2021 and 2022, with half of payroll taxes for 2020 due by Dec. 31, 2021, and the other half due by Dec. 31, 2022. If the first round of applications for the forgivable loans is any indication the available funds will go quickly.