CARES Act Frequently Asked Questions for Businesses

BUSINESS IMPACTS AND SUPPORT

Q: I believe my business may qualify for support through the CARES Act. What should I do first?

A: While some details are still being finalized, you can review various loan options and tax updates made available through the CARES Act. See our resource library here.

Then, start reviewing appropriate applications and gathering materials you may need for applications including 2019 payroll information, 2019 1099s for employees and independent contractors, healthcare premiums paid by the business, and company-funded retirement plan funding.

Q: My business is significantly impacted by COVID-19. What relief options are available to me?

A: The federal government, many states, and some local jurisdictions are providing assistance to impacted businesses. For instance, the U.S. Small Business Administration (SBA) is offering low-interest federal disaster loans for working capital to small businesses suffering substantial economic injury as a result of the COVID-19.

Pennsylvania is also offering assistance programs. Click here for a summary of resources.

UNEMPLOYMENT

Q: If my state ordered my business to close, will employees be entitled to unemployment benefits?

A: Depending on the state, the length of the closure, and the employee’s work history, employees who are prevented from coming to work because their employer temporarily ceases operations due to COVID-19 may be eligible for unemployment benefits.

Click here for more information on Pennsylvania’s unemployment compensation benefits and learn how to apply.

Q: If I need to temporarily reduce employees’ hours, are they eligible for unemployment benefits?

A: Generally, if there’s a reduction in available work hours for employees, the employees may be eligible for partial unemployment benefits. Employees can find more information here.

Q: I am self-employed. How do I know if I am eligible for unemployment benefits and how do I apply?

A: The federal CARES Act will provide unemployment benefits to the self-employed, gig workers, and other individuals who previously were not eligible for unemployment. Special instructions will be provided to these individuals. At this time, you should NOT file a claim through the existing online system or phone number if you are not currently eligible for unemployment. Click here for more info and to check for updates.

FAMILIES FIRST CORONAVIRUS RESPONSE ACT

Q: What is the Families First Coronavirus Response Act (FFCRA)?

A: It requires employers to provide paid leave to certain employees impacted by COVID-19 and offer tax credits to employers that do so. The law requires two types of paid leave: Emergency Paid Sick Leave and Public Health Emergency Leave/Expanded FMLA. Generally, employers with fewer than 500 employees must provide leave under the FFCRA. The leave requirements take effect April 1, 2020 and expire on December 31, 2020, according to the Department of Labor.

The Department of Labor also has the authority to issue regulations exempting employers with fewer than 50 employees from the PHEL requirement and certain aspects of the sick leave requirement, if that requirement would jeopardize the viability of the business.

Find more information here.

OTHER

Q: I am considering an early withdrawal from my retirement plan. What do I need to consider?

A: The CARES Act waives the 10% penalty for impacted individuals taking early distributions of up to $100,000 from qualified retirement plans, including IRAs and 401ks, between January 1, 2020 and December 31, 2020.

Q: Where can I find more information and resources related to COVID-19 and my business operations?

A: See our resource library for more information.

 

 

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