Stimulus Packages: For Small Businesses and Individuals

With new information coming out daily it can be difficult to understand the options businesses have under the various stimulus packages so I have attempted to summarize the information as best as I understand it. I am not a tax advisor, rather a benefits broker, but as I have been doing a lot of research on the subject and would like to share what I have found. Again, please do not take this information as proof of eligibility, but rather a broad overview. Please discuss details with your tax advisor or bank manager.

Small businesses for this purpose are considered to have less than 500 employees.


The intention of the Paycheck Protection Program is to prevent employee terminations.

SBA Loan – two levels

a. $10,000 loan is granted automatically to many businesses. When you apply, you are automatically applying for the $10,000 basic loan plus a loan of up to $10 million

b. Once initially approved, $10,000 is automatically deposited into your bank account.  If not approved for a loan, the $10,000 does not need to be repaid

c. If approved for an amount over $10,000, all monies will need to be repaid including the initial $10,000

d. Go to https://covid19relief.sba.gov/#/ for more information

The duration and severity of our current pandemic is undetermined but that does not mean we should panic, rather businesses should be creating short and long-term plans of actions now, rooted in law and based upon common sense. To that end, we would like to supply you with resources to support these efforts:

Paycheck Protection Program (PPP) through the CARES Act

a. The intention of the PPP is to prevent employee terminations

b. Applications under the PPP are to be submitted through your bank. I suggest you apply at your local bank as they are familiar with you and your business – otherwise approval could be delayed or even declined

c. The grant is intended to be used primarily for payroll and benefits – it looks like 75% of the money needs to be spent on these expenses. As this is a grant, if monies are used correctly, they will not need to be repaid

d. For more information or to find SBA-approved lenders go here: https://www.sba.gov/funding-programs/loans/coronavirus-relief-options/paycheck-protection-program-ppp

$1,200 per adult stimulus, $500 per child (only for citizens of the United States)

a. You are eligible under the adult stimulus package if your gross adjusted earnings are as follows:

i. Couples filing jointly will receive the full amount if their adjusted gross income is less than $150,000, and a reduced amount for income up to $198,000

ii. Head of household filing with adjusted gross income up to $112,500 will receive the full amount, and a reduced amount with income up to $146,500

iii. Singles filing with adjusted gross income up to $75,000 will receive the full amount, and a                              reduced amount with income up to $99,000

b. The stimulus package applies to the 2020 tax year. This means the IRS is using 2018 or 2019 tax filing data to determine the amount of your stimulus check, however if your 2020 earnings exceed $150,000 then you will be required to pay part or all of the money back

c. If you do not file a tax return as you are on social security or unemployed, you are still eligible however, you will need to wait for the IRS to release a form for non-typical tax payors

Please feel free to reach out to our trusted accountant to discuss content of this article further:

Steven Bell, President, Servitiam Accounting, Inc.
(303) 385-8439 | sbell@servitiam.com

Steven Bell is the President of Servitiam Accounting, Inc., a Denver based accounting firm that specializes in strategic tax planning for small business owners. By providing business owners with pro-active tax planning techniques, Servitiam Accounting, Inc. has assisted business owners in successfully growing their businesses while protecting their assets. Steven holds a Master’s Degree in Taxation and is a frequent speaker on small business and tax issues. As a Certified Tax Coach, Steven has saved small business owners thousands of dollars a year using provident techniques.

As always, feel free to contact Blue Chip Benefits at (888) 225-8244 or Team@BlueChipBG.com with any questions or concerns about your insurance or to talk about COVID-19 and how it is affecting your business and employees. We’re here to assist and may have recommendations that could help your bottom line and/or your employees.

Stay healthy and strong!

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