What Does The CARES Act Mean For Your Hampton Roads Small Business?

These days are moving VERY quickly, and we are working VERY hard to get communication out to our Hampton Roads clients and friends.

You probably already heard that the CARES Act (the mammoth 880+ page disaster relief bill) was signed over the weekend, and help IS indeed on the way.

But there are so. many. rumors. flying around out there that I wanted to reach out to clear up some confusion. (I’ve even seen some accountants charge frightened business owners over $2K for filling out these 5-minute forms.)

First things first (and before I give you any more details):

The SBA EIDL online application is 
BACK up and running.

Go here >> https://covid19relief.sba.gov/

This Economic Injury Disaster Loan website is working smoothly as of right now, and there is a check box option to request the $10,000 immediate business stimulus grant. Remember, Congress only allocated $10 billion of that $2.2 trillion stimulus package to these small business grants, and they’re first come, first served, so get on this ASAP if you want immediate help.

We are in your corner:

(757) 857-1880

And one last thing before I get to more details about these loans:

Because of the intensity of this season for ALL of us, and the fact that this bill is so massive, I would ask for your patience with my team and me as we wade through all of it.

We are LOCKED IN on getting clarity on all of the (many, many) clauses from the CARES Act that will apply to our clients, and are committed to sharing all of the information as soon as it’s ready.

We are in your corner — so you can rest easy that WHATEVER needs doing will get done, and done right.

(And again … feel free to send your friends our way for help.)

Now to some details about the 
Paycheck Protection Program (PPP) Loans.

The goal with these small business funding loans from the CARES Act is to keep people employed and prevent a massive spike in unemployment.

You should know that Hampton Roads businesses cannot get both EIDL and PPP loans at the same time. You can apply for the EIDL loan now and the PPP loan when it becomes available.

If you qualify and accept the EIDL loan, and you subsequently qualify for the PPP loan, you can refinance the EIDL loan with the PPP loan. OR you can apply for both loans and decide which one to take if you qualify for both. Loans are limited to one per Taxpayer Identification Number.

For the PPP loans, you can have your bank help you through this, or go directly through the SBA. Banks are getting ready to make these loans in as short as one day from application to approval to distribution.

So, if you have an existing relationship with a bank, you can get your SBA PPP application started with them, and they’ll line it up in the queue.

(And again, we’re here to help).

Some bullet points on these loans…

Eligibility: The guidelines are very confusing, but essentially, here are the basic tests.

  • Employ less than 500 employees
  • Demonstrate you have been impacted by the virus disaster
    *You will sign an affidavit stating this is the case, which may be used later to charge you with fraud if you’re unable to prove you’re affected.
  • Have to have been in business since at least February 15, 2020
  • No credit score requirement
  • 501c3 is eligible (nonprofit)

*If you only take distribution as an owner and don’t have payroll distribution, or you are a contractor and take only Schedule C payments, you likely DON’T qualify. But double check with your bank or the other places you can apply.

(Again, we can help here.)

Uses: You can utilize these funds for the following uses.

  • Payroll
  • Rent
  • Utilities
  • Health Insurance
  • Interest Expense / Debt Obligations

Loan Amount: 
2.5x monthly payroll (W2 + 1099 wages) based on the average from February 15, 2019 to February 15, 2020

  • Employer payroll taxes are not counted (7.6% on average)
  • If your employees or contractors get paid more than $100,000 they don’t count within the total
  • Cap is lesser of 2.5x annual payroll or $10M, whichever is less
  • International payroll doesn’t qualify


  • First 8 weeks: Whatever you use for the approved uses above, it may be forgiven, if you maintain the same level of employees / contractors as before the crisis.
  • If you refill any position by June 30 that you let go since February 15, 2020, it counts toward the forgiveness clause above.
  • If you reduce a person’s pay by more than 25%, they are not counted toward your “retention” criteria for possible forgiveness.
  • 10-year term with a rate not to exceed 4%.
  • No personal guarantee required.
  • No collateral required.
  • Interest and principle is deferred the first six months and can be deferred up to a year.
  • Forgiveness is not counted as taxable income.
  • No prepayment penalty.


You’ll have to provide receipts / payroll statements to get any amount forgiven by the bank at a later date.

Let Us Help You Navigate These Waters.

I keep hearing about these strategy notes being shared all over Hampton Roads — and that is fine with me. The more the merrier. Good information is good information, and we’re all in this together.

But if you want help from experts who get it, and who have YOUR best interests in mind…

…well, you know where to find us.


Steve Kallam

(757) 857-1880

Virginia Accounting Services


And again, to reiterate my “CRISIS Action Plan” for my clients:

1) Don’t marinate in other people’s panic. Be mindful of your social media consumption.

2) Get financially and logistically prepared for the worst.

3) Make sure you have some ready, liquid assets, if you are able. (I.e., cash in the bank, and in hand.)

4) Set aside plans for any big spending until the dust settles — but don’t let up on your communication and your marketing (especially digital).

Much more to come in the days ahead.

We will get through this. Together.

I’m grateful for our chance to serve you and your Hampton Roads business — and we are dedicated to its success, in every season.

Feel free to forward this article to a business associate or client you know who could benefit from our assistance. While these particular articles usually relate to business strategy, as you know, we specialize in tax preparation and planning for families and business owners.

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