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
For the time being, small businesses and nonprofits in Massachusetts are being encouraged to apply for federal Disaster Loan Assistance.
Learn about the business funding and financing programs that the state of Massachusetts has to offer on their official state website.
COVID Local Small Business Help
The City of Boston's Small Business Relief Fund was designed to help Boston small businesses, "small business" here meaning a for-profit entity with fewer than 35 employees. Businesses with 0-5 employees are eligible for a $2,500 relief grant; businesses with 5-15 employees are eligible for a $5,000 relief grant; businesses with 15-35 employees are eligible for a $10,000 relief grant.
As of April 27, 2020, the city is currently not accepting new applicants for the Small Business Relief Fund. For any updates, visit the City of Boston's website.
The Boston Artist Relief Fund, previously known as the Opportunity Fund, will award $500 grants to individual artists whose creative practices and incomes are being negatively impacted by the coronavirus pandemic. The Fund is currently open for applications until June 30th, 2020. You can apply on the Department of Arts and Culture website.
The City of Worcester, MA has prepared the COVID-19 Small Business Resiliency Grant. Businesses could get up to $10,000 in funds to use for the payment of wages, rent, loss of inventory, and other fixed costs.
A business in the City of Worcester must have experienced at least a 50% loss of revenue since March 10 due to the coronavirus pandemic. The first round of applications closed on Friday, March 27th. The City is currently processing those applications and is now planning for the second round of applications, which won't be open for a couple of weeks.
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.
Private Relief in Massachusetts
The Worcester Together: Central Mass COVID-19 Fund seeks to support organizations in Worcester County who are on the front lines of battling this pandemic. Grants between $5,000 and $50,000 will be awarded to nonprofit organizations. Applicants will be notified 72 hours after the completed application is received whether they have been accepted or not.
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 collection of regular sales tax, meals tax, and room occupancy taxes that would be due in March, April, and May will instead be due on July 15th, 2020. All penalties and interest will be waived.
As of April 3rd, 2020, Personal income tax returns (including income tax due with partnership composite returns) also have an extended deadline of July 15th. The governor is also waiving late-file and late-pay penalties for businesses that have corporate excise tax that was originally due April 15th. Interest will still apply. Businesses may also be eligible for a 6-7 month corporate excise tax extension.
For more updates on tax relief options from the State of Massachusetts, visit Massachusetts’ Department of Revenue.
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 Baker-Polito administration of Massachusetts has filed emergency legislation that allows new unemployment claims to be paid more quickly by waiving the one-week waiting period for unemployment benefits.
Employers whose businesses are severely impacted by the coronavirus pandemic can request extensions for filing and paying unemployment contributions.
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 Massachusetts website.
NOTE: On March 23, 2020, Governor Baker issued an emergency order requiring all businesses and organizations that don’t provide essential services to close their physical workplaces as of Tuesday, March 24th until Monday, May 4th. Read the Governor's executive order. To see if your business is considered essential, read the “COVID-19 Essential Services” list.
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