• Tom Copeland: Should You Apply for Your State’s Stabilization Grant? Yes!
• Tom Copeland: Questions and Answers About the Child Care Stabilization Grant
The American Rescue Plan made health care coverage more affordable! The Inflation Reduction Act extended health care subsidies through 2025.
Additional Resources You Can Use!
These one pagers are easy-to-understand explanations of IRS forms and business calculations to save you money!
In response to the COVID-19 public health pandemic, Congress passed several bills in 2020 to provide business relief, particularly for small business owners such as family child care home providers.
The SBA Paycheck Protection Program (PPP) expired on May 31, 2021. However, loan applications were processed through June. At this point, providers that received a PPP loan need to apply for forgiveness (which is what turns the “forgivable loan” into a grant). Providers can apply for forgiveness as soon as all the loan funds are spent. This means that PPP applications submitted on or before May 31 will continue to be processed in June. However, no new applications will be accepted unless Congress extends the program. Borrowers need to apply for forgiveness within 10 months of spending the money (in order to qualify for forgiveness).
The SBA Paycheck Protection Program (PPP) Online Forgiveness Portal
In August 2021, the SBA opened a new online PPP loan forgiveness portal for loans of $150,000 or less. This means that businesses that received a PPP loan can apply online through the SBA instead of going through their lender that approved the loan.
The SBA created the new online forgiveness portal to help expedite forgiveness approval, which turns the loan into a grant (i.e., borrowers will not have to repay it). The new online portal is designed to speed up the approval of forgiveness for small loans ($150,000 or less).
How the SBA Online Forgiveness Portal Works
The online portal requires borrowers to submit the same information that they otherwise would have filled out on a bank form. It can be faster for borrowers to receive forgiveness because they won’t have to depend on their bank queue of review for approval, which could include both large and small loans. Because the online portal is designed only for small loans, the process could be faster.
In order to use the SBA online portal, your bank must opt-in (which is a bank process partnering with the SBA). More than 1,200 banks have opted in as of August 20. Check here to see if your bank has opted in. Because the portal is new, it is expected that many more banks will be opting in over the next few weeks.
Be prepared! Review the form below of required information (the same information is required through the online portal as would be required through a bank form).
SBA Form 3508S. This form is for borrowers of $150,000 or less. It’s a short one page form. No calculations are required. Borrowers do not need to submit documentation. However, the SBA requires retaining all records for Form 3508S for four years (in case borrowers are subject to a random audit).
SBA Online Forgiveness Portal Tips! When you first visit the online portal, you will be required to set up an account (with your email) and create a password. Write down the password to save it! You will receive an email to verify that you want to create an account. It’s quick, just click on the link and confirm. Once your account is set up (which is really fast), you will need to have this information ready to submit through the portal:
SBA Portal User Guide! The portal is really simple. However, reading through the user guide can make the portal submission process much faster and may help answer any questions you have. If you do have questions, the SBA has set up a hotline where a team of SBA staff are ready to answer any question! If you have two PPP loans (a first draw loan and a second draw loan, you must apply for forgiveness for each loan separately).
SBA Hotline: 877-552-2692
Brief Background About PPP loans. Congress created the PPP “forgivable loan” (in other words, a grant) for small businesses in March of 2020. Congress has extended PPP several times. In December 2020, Congress separated PPP into two programs.
As long as borrowers use the funds for eligible expenses, borrowers can apply for “forgiveness”, which is what turns the loan into a grant that does not need to be repaid. Borrowers need to apply for forgiveness within 10 months of spending the money.
Overview of Eligible Expenses for Forgiveness
In general, in order for forgiveness to be approved, at least 60% of the funds must be used for payroll related costs. This means up to 40% of the loan can be used for fixed costs such as mortgage interest, rent, utilities, software used for your business (e.g., for record-keeping or supporting other business operations), perishable goods (such as food costs), expenses for PPE, cleaning supplies, and other expenses related to social distancing and public health requirements related to COVID. For family child care providers, you are eligible for a PPP forgivable loan whether or not you have employees. (For example, for purposes of the PPP loan, an FCC provider is considered an employee).
Allowable Expenses for Non-payroll Uses of PPP Funds. Four additional categories of eligible expenses for fixed costs were added through legislation enacted in December.
Note: Although expenses related to fixed costs were expanded in legislation enacted by Congress in December, the requirement for at least 60% of PPP loans to be used for payroll related purposes remains in place. Payroll expenses include cash compensation, employer contributions for group health, life, disability, vision or dental insurance and employer contributions to employee retirement plans (exception: benefits for the self-employed (e.g., family child care providers) are not included because the SBA considers such payments already included in compensation).
Each of the SBA Forms that correspond to PPP loans is accompanied by detailed instructions: 4 pages of instructions to explain SBA Form 3508S, 5 pages of instructions to explain SBA Form 3508EZ, and 8 pages of instructions to explain SBA Form 3508.
For help in completing SBA forms, ask your lender or reach out to your local Small Business Development Center (SBDC) or, call the SBA Hotline: 877-552-2692 for help with the portal.
Your Registered Family Child Care Home!
Have your heard about our online family child care toolkit? Learning resources, business templates, discounts on frequently purchased products and more!
For more information contact:
732-918-9901 ext. 132
COVID-19 Child Care Information – NJ Child Care Agencies
Child Care Aware of New Jersey:
Small Business Administration:
Internal Revenue Service:
COVID-19 Economic Injury Disaster Loans. The U.S. Small Business Administration offers low interest loans to small businesses, including family child care providers. Unlike the PPP program, the Economic Injury Disaster Loans (referred to as EIDL) are not forgivable. The interest rate for family child care homes is 3.7%. Payments are deferred for one year (although interest accrues). The loan is for 30 years, but can be paid back sooner if the borrower chooses to do so.
Targeted EIDL Advance funds of up to $10,000 (which are grants, not loans) will be available to applicants located in low-income communities who previously received an EIDL Advance for less than $10,000, or those who applied but received no funds due to lack of available program funding. Applicants may qualify if they:
Applicants do not need to take any action at this time. The SBA will reach out to those who qualify.
Employee Retention Tax Credit. For family child care providers that have an employee, you may also qualify for an employee retention tax credit. Read this one pager on the Employee Retention Tax Credit and talk to your tax preparer to see if you can claim this tax credit.
• Recorded Webinar with Q&A. Money Management and Retirement Planning by Tom Copeland, March 1, 2021
• Slide Presentation from the March 1, 2021 Recorded Webinar
• Individual Retirement Account (IRA) Comparison Matrix (One page explainer, March 2, 2021)
2022 NJ Stabilization Grants:
Provider Wellness/Health Care
Child Care Aware of New Jersey:
Strengthening Children’s Fine and Gross Motor Skills – Resources for FCC providers and Parents
Note: 2 versions are presented, use what works for you best – or modify and create your own!