COVID Small Business Relief: Loans and Grants
Depending on the size of your small business, you may be qualified for certain loans and grants on both the federal and state level.
What is considered a small business?
Small businesses are defined based on what type of industry they belong to. To determine if your business is considered to be a small business by the Small Business Administration, visit the SBA Size Standards webpage.
COVID Federal Small Business Help
The Small Business Administration (SBA) is providing disaster loan assistance in all states. These low-interest loans are targeted toward small businesses and nonprofits that have experienced severe economic injury due to the coronavirus.
As part of the Coronavirus Aid Package (CARES Act), small businesses can also apply for forgivable loans under the Paycheck Protection Program (PPP) that can be used to pay employees and fund other day-to-day business operations. To learn more, visit our guide to the CARES Act or read about the Paycheck Protection Program in particular.
COVID State Small Business Help
In Iowa, Governor Reynolds announced a new Iowa Small Business Relief Program that will provide financial assistance to small businesses and tax deferrals to any Iowa businesses that have been economically impacted by the COVID-19 pandemic.
To see if your Iowa small business qualifies for either the grant program or the loan program, visit the Iowa Economic Development website. The Iowa Small Business Relief Fund application closed as of Tuesday, March 31, at 12 p.m.
Another fund has been created to support Targeted Small Businesses (TSB) with zero employees that have been economically impacted by the COVID-19 pandemic. This program offers eligible small businesses grants up to $10,000. COVID-19 Targeted Small Business Sole Operator Fund Application can be entered on the Iowa Economic Development website.
Iowa Small Business Development Centers are offering counselors to help you navigate through the COVID-19 crisis. Learn more with the Small Business Development Counseling Resource website.
COVID Local Small Business Help
Businesses in the cities of Clear Lake and Mason City, Cerro Gordo County, and the North Iowa Corridor EDC, who have experienced business disruption and revenue losses will be eligible for grants up to $5,000 to help ensure business continuity with the Small Business Recovery and Continuity Fund. This assistance will provide businesses with immediate, short-term cash flow that can be deployed for a variety of uses; including working capital, inventory, lease/mortgage payments, etc.
COVID Small Business Relief: Private Sources
Some private companies and organizations have established grants for small business relief. Facebook is one such company. The Facebook small business grant was created to help small business owners amid disruptions that are being caused by the coronavirus.
Certain credit card companies and banks, like Bank of America, are also offering economic relief for their small business members.
For a larger list, visit our guide to private grants for small business relief.
The federal government has extended the payment deadline for all first-quarter tax payments from April 15th, 2020 to July 15th, 2020. Small businesses must file IRS Form 7004 to extend their tax payments, while individuals must file IRS Form 4868.
State Tax Relief
The Iowa Department of Revenue extended the filing and payment deadline to July 31st, 2020, for these following state tax types:
- IA 1040 Individual Income Tax Return and all supporting forms and schedules
- IA 1040C Composite Return and all supporting forms and schedules
- IA 1041 Fiduciary Return and all supporting forms and schedules
- IA 1120 Corporation Income Tax Return and all supporting forms and schedules
- IA 1120F Franchise Tax Return for Financial Institutions and all supporting forms and schedules
- IA 1065 Iowa Partnership Return and all supporting forms and schedules
- IA 1120S S Corporation Return and all supporting forms and schedules
- Credit Union Moneys and Credits Tax Confidential Report
Income tax withholding deposits that were due by March 25th, 2020, are now extended to April 10th, 2020.
Changes to Federal Paid Leave
As of March 18th, 2020, the federal government is providing certain workers paid sick leave in the event that they are ill, quarantined, or seeking medical care.
This relief act applies to employees at small, midsize, and nonprofit companies so long as the employee has been employed for more than 30 days. For more information, you can read the Families First Coronavirus Response Act.
The Department of Labor also recommends that small business employers check if their employee’s sick leave is covered under the Family and Medical Leave Act (FMLA). If an employee or their family is incapacitated due to the coronavirus (or any pandemic illness), their employer is required to provide job-protected, unpaid leave.
So long as employers are covered, they are required to abide by federal FMLA and state FMLA laws. For more information on the FMLA, check out the Department of Labor’s website.
In the event that your small business undergoes financial difficulties during the coronavirus spread, consider implementing these guidelines for the good of your business and its employees:
- Consider putting employees on temporary leave instead of terminating them
- Communicate with customers regarding business closures, reduction of hours, or maintenance changes
- Diversify your suppliers or stock inventory with an adequate amount of supplies to last an extended period of time
- Contact your insurance agent to review any business interruption policies that your business may have in place
- Prepare a plan with your employees regarding present and future business actions regarding the virus
- Review your emergency business continuity plan. If you don’t have one, take a look at New York’s Emergency Planning Process Sheet.
- Determine whether your business is considered essential or nonessential. Visit our guide to essential businesses for more information.
For more business solutions, visit the SBA website.
The Coronavirus Aid Package (CARES Act) is providing extended unemployment benefits to workers who are ineligible for regular unemployment programs but are out of work solely because of the coronavirus pandemic. Unemployment compensation has also been extended by 13 weeks.
The state government of Iowa has set up a page for all coronavirus unemployment inquiries on the Iowa Workforce Development website or check the coronavirus scenarios PDF.
This page holds common questions and answers for employees affected by the Covid-19 pandemic along with links to apply for unemployment benefits.
NOTE: Workers cannot file for unemployment if they are receiving any kind of direct financial help from your business.
Small business employers should also establish strategies with their employees and customers to avoid spreading the virus:
- Encourage sick employees and customers to stay home
- Separate sick employees from the rest of the employees and encourage them to go home
- Practice good self-hygiene
- Avoid travel
- Clean all work environments routinely and thoroughly
For periodic state updates, visit the State of Iowa website.
The best way to prevent the spread of the virus in your business is to create a “work from home” policy. If your business is able to provide remote work opportunities for its employees, consider the following strategies:
- Invest in new technologies and software
- Provide remote training for employees
- Establish a remote communication system
- Enforce a daily routine
- Trust in your employees’ ability to stay on track