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Understanding the Stimulus Package

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

Videos & Slides

CNBC Summary  

  • Who’s eligible? Businesses and 501(c)3s with fewer than 500 employees; Those who are self-employed and independent contractors; Must have been in business since Feb. 15 
  • What’s available? Borrowers can borrow 2.5X their monthly payroll expenses, up to $10M; Max interest rate of 4% with 10-year term 
  • How can the loans be used? Qualified payroll expenses; Interest on mortgage and other debt obligations; Rent; Utilities 
  • Loan forgiveness: Depends on expenses, layoffs; Staffing based on Feb. 15 staffing levels 

WSJ Summary 

  • $349 billion for Small Business to keep Americans on payrolls; made available by private lenders and guaranteed by the Small Business Administration (SBA) 
  • $500 billion Corporate Aid to backstop Federal Reserve loans 
  • $221 billion Tax Benefits that allow businesses to defer payroll taxes 
  • $32 billion Airline Wages for grants towards covering wages of air carriers 
  • $340 billion Supplemental Spending for health-care providers, medical equipment, Medicare reimbursement, telehealth, low-income patients and hospitals treating victims of the virus 

Paycheck Protection Program 
This program gives small businesses access to short-term cash flow assistance aimed to help deal with the immediate global impact caused by the COVID-19 pandemic. These loans are made by approved lenders, certified by the SBA (Small Business Administration) and are guaranteed by the federal government of the United States.