Few Qualify for the New Targeted EIDL Advance
There is a new grant program that offers up to $10,000 in tax- free money to eligible family child care providers. It’s called the Targeted Economic Injury Disaster Loan Advance program (Targeted EIDL Advance) sponsored by the Small Business Administration (SBA).
Unfortunately, only a few family child care providers will be eligible.
In 2020, the SBA created the Economic Injury Disaster Loan (EIDL) Advance that offered up to $10,000 in tax- free money. Because so many businesses applied for this money, the SBA quickly reduced the amount to $1,000. Many providers did receive $1,000 under this program. The money was taxable and could be spent on almost any business expense. This program ran out of money last summer.
Under the new Targeted EIDL Advance, there are tight restrictions on who is eligible.
Providers must have applied for the EIDL Advance in 2020, and
Providers must have either not received the full $10,000 in 2020, or applied but did not receive any money because the program ran out of funds.
If you did apply for the EIDL Advance in 2020, you must also meet these qualifications for the new Targeted EIDL Advance:
You must live in a “low-income community”, and
You must demonstrate that you had more than a 30% reduction in your gross income during an 8-week period beginning on March 2, 2020 or later. In other words, you must show this reduction in gross income for any 8-week period after March 2, 2020 compared to a 8-week period before then.
Obviously, these are strict criteria that only a few providers will be able to meet.
If you received $1,000 in 2020, you may be eligible for $9,000 under the new Targeted EIDL Advance. If you applied and didn’t receive any money, you may be eligible to receive $10,000.
How to apply for the Targeted EIDL Advance
You don’t. If you previously applied for the EIDL Advance, you do not need to reapply.
The SBA will contact you by email and let you know that you may be eligible.
They will determine if you live in a “low-income community.”
They will give you instructions to determine your eligibility and ask for your tax return.
They should be sending out these emails in the coming weeks. Look for an email ending in @sba.gov.
If you do receive the new Targeted EIDL Advance, you will not have to pay it back. It is not taxable income. It can be used for almost any business expense, including paying yourself. If you have questions about this program, you can contact the SBA at 1-800-659-2955 or by email at TargetedAdvance@sba.gov. At this time, there are no plans to open up the new Targeted EIDL Advance to the broader public.
This document was funded by the Child Care Communications Management Center, which is funded by the Office of Child Care (OCC), Administration for Children and Families (ACF), U.S. Department of Health and Human Services (HHS), and was developed in partnership with the National Center on Early Childhood Quality Assurance, which is funded by OCC, the Office of Head Start, ACF, HHS. This resource may be duplicated for noncommercial uses without permission.
Tom Copeland – www.tomcopelandblog.com
Image credit: Small Business Administration
