For information about how recent legislation will impact your small business or nonprofit, click here to visit my Small Business webpage.

Information & resources on coronavirus

Resources for Delaware small businesses and nonprofits

The Delaware district office of the Small Business Administration (SBA) can connect you with resource partner organizations that provide advice and guidance to small businesses, including SCORE Delaware,SBDC Delaware, and the Women's Business Center at True Access Capital.

The Association of Women’s Business Centers and America's SBDC have consolidated information on COVID-19 resources from federal agencies. Visit this page to inform your small business or nonprofit operation: https://covid-sb.org/

Paycheck Protection Program

The CARES Act established the Paycheck Protection Program(PPP). The PPP has provided much-needed relief to millions of small businesses so they can sustain their businesses and keep their workers employed. Small businesses and eligible nonprofit organizations, Veterans organizations, and Tribal businesses, as well as individuals who are self-employed or are independent contractors, are eligible if they also meet program size standards.

PPP is currently open to eligible first-time participants in the program. The American Rescue Plan, passed in March 2021, made changes that will allow some 501(c) organizations access to PPP for the first time. Those who have received one PPP loan already may also qualify for a second loan at this time. Generally, applicants who have fewer than 300 workers and experienced a revenue decline of 25% or greater in any single calendar quarter in 2020, relative to the same quarter in 2019, are eligible for a second PPP loan. The program is scheduled to close again on March 31, but Congress is actively considering legislation that would extend the application deadline another two months.

The maximum loan amount for most borrowers is 2.5 times payroll costs in a typical (pre-pandemic) month. One exception is that restaurants and hotels qualifying for a second PPP loan may receive 3.5 times payroll costs. The loan is all or partially forgivable. Forgiveness is based on the extent to which the borrower retains or rehires workers. Loans require no collateral or personal guarantees, carry a 1% interest rate, and come with an automatic 6-month deferment.

For more information and the application form, please see the Treasury's small business webpage.

The best way to apply for a first- or second-round PPP loan is to consult your existing bank. If it is not offering PPP loans, ask which banks in your community are, or you may want to consider online lenders, which include some popular tax and accounting websites.

Other Small Business Loans and Grants

The first coronavirus supplemental bill funded Economic Injury Disaster Loans (EIDLs), which remain available. These loans provide small businesses with long-term working capital loans, at a rate of 3.75% for businesses and 2.75% for nonprofits. Business must be deemed creditworthy and may have to provide collateral. To apply, visit the SBA Disaster Assistance website.

The CARES Act also provided that EIDL applicants would be eligible for an up-front grant of up to $10,000, which does not need to be repaid. General availability of these grants has expired. However, the December relief legislation allows eligible borrowers in low-income communities to receive the full $10,000 grant, whether they did not apply previously or received an amount less than $10,000.

Applicants must separately request the EIDL grant, but are no longer required. You may also contact the Delaware SBA office at: https://www.sba.gov/offices/district/de/wilmington.

The CARES Act, the ]COVID-19 response bill passed in March 2020, provided debt relief for businesses with an existing SBA-backed loan (other than PPP), including 7(a), 504, and microloans. This provision, authored by Senator Coons, was renewed under the December 2020 legislation. Eligible borrowers will receive 2 more months of loan forgiveness. Those in hard-hit industries will receive an additional 3 months of forgiveness. Talk to your lender about this relief program.

The SBA will continue to update its website with further information here.

Employee Retention Tax Credit

For businesses and nonprofits that have been forced to close or reduce operations due to the pandemic and have seen a substantial revenue loss, an important tool is the Employee Retention Tax Credit. The Employee Retention Credit is a fully refundable and, in some cases, advanceable tax credit for employers. The credit is relatively larger for smaller employers, but is also available to large employers. The December 2020 relief legislation expanded the credit and extended it until July 1, 2021, and the American Rescue Plan extended it through December 2021. Going forward, eligible employers may receive a credit equal to as much as $7,000 per retained worker. Businesses that receive a PPP loan also may access the ERTC with respect to wages not paid for with forgiven loan proceeds.

See the IRS FAQ on the Employee Retention Credit.

Delaware small businesses in the hospitality sector

Information on the State of Delaware program for small businesses in the hospitality sector can be found here.

Delaware’s rural businesses

Many small businesses impacted by COVID-19 might also be able to qualify for USDA Rural Development programs as well. Additionally, a number of small businesses and agriculture concerns don’t always qualify for SBA programs, but are still impacted, and USDA is also helping rural businesses and farmers. More can be found about USDA’s Rural Development programs in Delaware here: www.rd.usda.gov/de.

EMERGENCY LEAVE

The Families First Coronavirus Response Act (FFCRA) signed into law on March 18, 2020 required certain public employers and private employers with fewer than 500 employees to provide their employees 10 days of paid sick leave and up to 10 weeks of paid family leave to employees under certain COVID-19 circumstances. The mandate for employers to provide emergency paid sick leave and emergency family and medical leave expired on December 31, 2020.

What if an employer wants to voluntarily offer expanded paid sick leave?

Although the FFCRA mandate for employers to provide paid leave was not extended, the American Rescue Plan does extend and expand the FFCRA refundable payroll business tax credits for certain employers that want to voluntarily provide the leave to employees. The expanded payroll tax credits are now available from April 1, 2021, to September 30, 2021.

For the purposes of qualifying for the tax credits for paid sick leave, the American Rescue Plan added the following additional qualifying reasons for an employee to take leave: The employee is seeking or awaiting the results of a diagnostic test for or a medical diagnosis of COVID-19 after an exposure or at the employer's request; the employee is obtaining a COVID-19 vaccine; or the employee is recovering from any injury, disability, illness or condition related to a COVID-19 vaccine. The ARP also provides a new annual allotment of up to 80 hours (10 days) per employee of qualifying paid sick leave available for 2021 tax credits. For the purposes of qualifying for the tax credits for family and medical leave, the American Rescue Plan added the same qualifying reasons for an employee to take leave as outlined above and increased the aggregate cap for tax credits from $10,000 to $12,000 per employee.

The IRS is expected to provide updated guidance on the extension of these credits. Please visit: https://www.irs.gov/coronavirus/employer-tax-credits

For detailed information, see the Department of Labor FFCRA "Questions and Answers" webpage or the "Emergency Leave" section of my Frequently-Asked-Questions webpage.

How the credit works:

Employers will be required to initially pay for the new sick and family leave benefits, but a large portion of the costs will be paid back through refundable tax credits.

  • For the new sick leave benefits, the credit is limited to $511 per day per employee for workers taking leave and cannot telework because they are sick, have been advised to quarantine, or are experiencing COVID-19 symptoms. The credit is capped at a $5,110 total per employee. For workers who are taking leave to care for an individual with COVID-19 or related symptoms, the credit is limited to $200 dollars per day per worker. The credit is capped at a total of $2,000 per employee.
  • For the expanded FMLA benefits, the credit is limited to $200 per day per employee for workers taking leave and cannot telework because they must care for their own child whose school or childcare has been closed due to or related to COVID-19. The credit only begins after the worker has taken 10 days off in the form of unpaid leave, paid vacation, personal leave, or another form of paid leave. The credit can't exceed $10,000 in total for any worker.

Those self-employed can receive refundable tax credits against the self-employment tax that are similar to those allowed for employers. The credit is limited to $511 per day for sick leave and $200 per day for workers taking qualified family leave. The number of eligible days is 10 sick days per worker and 50 days for family related leave.

How to claim:

Employers will be able to reduce their semi-weekly or monthly payroll tax payments by the amount of their anticipated credit. The provisions were extended in the American Rescue Plan Act until September 30, 2021. The IRS has provided an extensive FAQs here on qualifying reasons for leave, eligible employees and employers, duration of leave, calculation of pay, and available tax credits. The IRS is also continuously updating www.irs.gov/coronavirus with information to help taxpayers, businesses, and others affected by COVID-19. I will continue to share updates with you as they become available.

How to Help:

For Companies with Medical Supplies, Equipment, and Services

The Federal Emergency Management Agency (FEMA) has provided the following information regarding medical supplies, equipment, and services for companies interested in coordination:

  • To sell medical supplies or equipment to the federal government, please email specifics to covidsupplies@fema.dhs.gov
  • If you have medical supplies or equipment to donate, please provide us details on what you're offering.
  • If you are a private company that wants to produce a product related to the COVID response, please email nbeoc@max.gov
  • If you are a hospital or other company in need of medical supplies, contact your State Department of Public Health and/or Emergency Management
  • For non-medical supplies, services, or equipment, if you are interested in doing business with FEMA, visit the FEMA Industry Liaison Program.

Additional Resources: