DISCLAIMER: Information provided here is for general education only. Please keep in mind this information is changing rapidly. We encourage you to consult with your lawyer, financial planner, and accountant.
COVID-19 has caused significant economic disruption for ketamine providers. Some clinics have shut down, while many others remain open (but at a reduced capacity) to provide care for increasingly suicidal patients.
MoodMonitor has seen a significant decline in treatments recorded, particularly for new patients. This decline has varied by region, but that may change as more states order quarantines.
However, given worsening moods and increasing anxiety, we expect an increase in the number of patients needing treatment once some of the restrictions on movement are lifted.
Part of the government’s response to assist businesses during this time is the recent passage of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act).
To save jobs, the CARES Act has been designed to distribute capital quickly and broadly.
There are two main loan programs to help small business owners through the COVID-19 crisis:
- SBA Cares Act Paycheck Protection Program Loans (PPPs)
- Economic Injury Disaster Loans (EIDLs)
Steps to Take:
- Read through entire Small Business Owner’s Guide to the CARES Act before making a decision.
- Ensure your business accounting records are up to date. You will want, at a minimum, a profit and loss statement showing your income, payroll and other expenses by month, for 2019 and 2020 to date.
- Determine how much business you have lost or additional expenses you have incurred since the pandemic began. Knowing where you stand will help you make an informed decision.
Paycheck Protection Program (PPP) Forgivable Loans
The Paycheck Protection Program creates a type of emergency loan that can be forgiven when used to maintain payroll through June. The basic purpose is to incentivize small businesses to not lay off workers and to rehire laid-off workers that lost jobs due to COVID-19 disruptions.
The U.S. Treasury has released the application for the Paycheck Protection Program. Please read both links before applying:
WHERE TO APPLY
To apply for a PPP loan, try the bank you use for business banking. If they are not participating, contact your local SBA for suggestions.
WHO CAN APPLY
To qualify, you need to have been in business on February 15, 2020.
The Treasury says small businesses and sole proprietorships with 500 or fewer employees can apply April 3, 2020.
HOW MUCH IS THIS LOAN?
This loan is based on payroll costs. You can borrow up to 2.5X of your average monthly payroll costs (including your net income from self-employment) plus an additional 25%.
To be forgiven, at least 75% of the loan amount must be used for payroll costs (including self-employment income), the other 25% can be used for business related rent, mortgage and utilities.
Payroll costs include payroll, employee benefits, payroll taxes and for a sole proprietor or independent contractor it can include payroll or net earnings from self-employment. Payroll costs exclude any compensation in excess of $100,000/year.
WHAT YOU NEED TO APPLY
To apply for a PPP loan you will need:
- A completed application which is found here.
- Monthly payroll statements from January 2019 to February 2020 for any employees on the payroll.
- For self-employed individuals not on payroll and owners of pass-through entities, a profit & loss statements for 2019 and 2020 through February by month to calculate your net earnings from self-employment and/or 1099-MISC forms.
SBA Economic Injury Disaster Loans (EIDL) and Emergency Grants
The Small Business Administration (SBA) offers special economic injury disaster loans (EIDL) when a need arises. All U.S. states and territories have been declared a disaster during the coronavirus pandemic.
WHERE TO APPLY
The SBA has an easy-to-fill out online COVID-19 Economic Injury Disaster application.
WHO CAN APPLY
To be eligible, a business must have been in operation on January 31, 2020.
The disaster loans need to be paid back, but the SBA also offers Emergency Economic Injury Grants which do not have have to be repaid.
HOW MUCH IS THIS GRANT?
According to the Small Business Owner’s Guide to the CARES Act, these grants, “provide an emergency advance of up to $10,000 to small businesses and private non-profits 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.”
CAN I APPLY FOR EIDL AND PPP?
You can apply for both. But you can’t “double dip” and get funds from both loan programs for the same purpose. Specifically the legislation states that a borrower who has taken out an Economic Injury Disaster Loan for purposes other than payroll costs between January 31, 2020, and the date Paycheck Protection Program Loans are first made available are still eligible for a Paycheck Protection Program Loan as long as it is not used for the same purposes. In addition, you may also be able to refinance the EIDL with a Paycheck Protection Program Loan.