The Economic Injury Disaster Loans and Emergency Economic Injury Grants provide an emergency advance of up to $10,000 to small businesses and private nonprofits harmed by COVID-19 within three days of applying for an SBA Economic Injury Disaster Loan (EIDL). To access the advance, you first apply for an EIDL and then request the advance. The advance does not need to be repaid under any circumstance, and may be used to keep employees on payroll, to pay for sick leave, meet increased production costs due to supply chain disruptions, or pay business obligations, including debts, rent and mortgage payments.
The following questions and answers were provided by the U.S. Senate Committee, Small Business & Entrepreneurship, to provide guidance about the programs and initiatives in the Coronavirus Aid, Relief, and Economic Security (CARES) Act.
Are businesses and private nonprofits in Arizona eligible for an EIDL related to COVID19?
Yes. Those suffering substantial economic injury in all 50 states, DC, and the territories may apply for an EIDL.
What is an EIDL and what is it used for?
EIDLs are lower interest loans of up to $2 million, with principal and interest deferment at the Administrator’s discretion, that are available to pay for expenses that could have been met had the disaster not occurred, including payroll and other operating expenses.
Who is eligible for an EIDL?
Eligible are the following with 500 or fewer employees:
• Sole proprietorships, with or without employees.
• Independent contractors.
• Cooperatives and employee owned businesses.
• Tribal small businesses.
Small business concerns and small agricultural cooperatives that meet the applicable size standard for SBA are also eligible, as well as most private nonprofits of any size. See below for more info on size standards.
My private nonprofit is not a 501(c)(3). Is it still eligible for an EIDL and a grant?
Yes. If you are a private nonprofit with an effective ruling letter from the IRS, granting tax exemption under sections 501(c), (d), or (e) of the Internal Revenue Code of 1954, or if you can provide satisfactory evidence from the State that the non-revenue producing
organization or entity is a nonprofit one organized or doing business under State law. However, a recipient that is principally engaged in teaching, instructing, counseling, or indoctrinating religion or religious beliefs, whether in a religious or secular setting, or primarily engaged in political or lobbying activities is not eligible to receive an EIDL. If you are uncertain whether you qualify, we recommend you consult with legal counsel to determine whether your organization meets program criteria.
Who is eligible for an Emergency Economic Injury Grant?
Those eligible for an EIDL and who have been in operation since January 31, 2020, when the public health crisis was announced.
How long are Emergency Economic Injury Grants available?
The Emergency Economic Injury Grants are available from January 31, 2020 through December 31, 2020. The grants are backdated to January 31, 2020 to allow those who have already applied for EIDLs to be eligible to also receive a grant.
If I get an EIDL and/or an Emergency Economic Injury Grant, can I get a Paycheck Protection Program (PPP) loan?
You may also apply for a PPP loan, whether you have already received an EIDL unrelated to COVID-19 or received a COVID19 related EIDL and/or Emergency Grant between January 31, 2020 and June 30, 2020. If you ultimately receive a PPP loan or refinance an EIDL into a PPP loan, any advance amount received under the Emergency Economic Injury Grant Program would be subtracted from the amount forgiven in the PPP. However, you cannot use your EIDL for the same purpose as your PPP loan. For example, if you use your EIDL to cover payroll for certain workers in April, you cannot use PPP for payroll for those same workers in April, although you could use it for payroll in March or for different workers in April.
How do I know if my business is a small business?
Visit here to find out if your business meets SBA’s small business size standards. You will need the 6-digit North American Industry
Classification Code for your business and your business’ 3-year average annual revenue.
How do I apply for an Economic Injury Disaster Loan?
To apply for an EIDL online, please visit SBA Disaster Loan. Also, your SBA District Office is an important resource when applying for SBA assistance.
Who can help me with the EIDL application process?
SBA resource partners are available to help guide you through the EIDL application process. You can find the nearest Small Business Development Center (SBDC), Women’s Business Center, or SCORE mentorship chapter here.