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Stimulus Round 3: The Business End

 

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It’s official. The third federal pandemic stimulus bill is headed to the White House for a final signature from President Biden. Conceptualized even before the passage of the second relief bill in December, for many, the focal point of the legislation has been direct payments (up to $1400 for those eligible), unemployment benefit expansions ($300 now, down from $400) and an increase in the federal minimum wage (struck down in the Senate). While those are crucial elements for any worker in today’s environment, businesses hit hard by the pandemic want to know what this package means to their bottom line. For the trusted advisor, here is a breakdown of the bill’s contents for small businesses and impacted industries according to Inc.:

  • The Paycheck Protection Program (PPP) will receive an additional $7.25 billion in funding, however, maintains its March 31 deadline.
  • An additional $15 billion will be afforded to the Economic Injury Disaster Loan (EIDL) Advance Grants. Previously discussed here.
  • Extends the Employee Retention Credit (ERC) through the end of 2021.
  • Businesses in the food service industry with fewer than 20 locations are eligible for up to $5 million in grants per location up to $10 million. A total of $28.6 billion will fund these grants.
  • An additional $1.25 billion is set aside for shuttered venue operators. Inc. reports, however, the U.S. Small Business Administration (SBA) has not yet enacted the existing live-venue grant program funded under the previous relief package.
  • $175 million will fund community organization and community financial institutions that work to spread awareness and drive participation in COVID-19 relief programs among small businesses. This “community navigator” program prioritizes increasing access among businesses owned by marginalized individuals, women and veterans1.

Those working in the governmental accounting space will see additional funding for state, local and Tribal governments. According to CNN, provisions for the public sector account for $350 billion of the overall $1.9 trillion bill.

  • $195.3 billion will be allocated to states and the District of Columbia.
  • $130 billion distributed to counties and cities.
  • $20 billion for Tribes, $4.5 billion for territories.
  • $10 billion to the Coronavirus Capital Project Fund with revisions to the formula to assist less populated states and boost their funding minimums2.

The MICPA will continue to track developments related to federal aid for small businesses impacted by the COVID-19 pandemic. 


References
  1. Ransom, Diana. “What’s in the 1.9 Trillion Rescue Plan for You…Inc. 7 Mar. 2021. Accessed on 8 Mar. 2021.
  2. Luhby, Tami & Katie Lobosco. “Here’s What’s in the Senate Stimulus Plan.CNN. 6 Mar. 2021. Accessed on 8 Mar. 2021.

Source: MICPA

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