Millions of employees lost their jobs during the COVID-19 outbreak, so many that a double-digit unemployment rate has been registered by the Bureau of Labor Statistics for the last three months. The good news is that you are usually entitled to receive unemployment insurance if you are considered to be a salaried or hourly employee and have lost a job through no fault of your own. And due to the unprecedented nature of the pandemic, the laws have been changed so that freelancers and contract workers can now receive unemployment insurance. But here’s another form of financial relief that you may have the right to if you work for yourself: a $1,000 grant that you won’t have to pay back. This is a benefit of the Economic Injury Disaster Loan (EIDL) program and it is money that could come in handy in a very difficult period.
Anyone applying for a Loan may also qualify for an advance of up to $ 1,000 per employee for up to 10 workers under the EIDL plan, and such grants need not be repaid. When you are self-employed and you have no staff, you may apply for a single grant of $1,000 to be used to offset any loss of income that you might face during the current recession.
Even legally, to qualify for a grant you must apply for a loan under the EIDL system. You don’t have to accept that loan though – you can only accept the grant portion. Also, use that money to save your company, whether by investing in marketing, supply or other expenses. You are permitted to apply for relief concurrently via the Paycheck Protection Program and EIDL. But you may need to use the money for different purposes. This, however, does not pose a problem.
About PPP Loan
With a PPP loan, your monthly payroll costs are capped to two and a half times. If you are self-employed and have an S-corp where you pay yourself a daily salary and continue to do so. You will end up getting your entire PPP loan forgivable.
In the meantime, you can apply for an EIDL and use that money for things. It includes such as supplies, office space, or whatever other expenses you incur. It is during earning an income. You should document how you spend each loan that you receive. So, it is in the event that the Small Business Administration winds up in need of that information. Thus, includes any money you collect.
Generally, self-employed individuals are left to fend for themselves when their income takes a hit. But owing to the catastrophic nature of the COVID-19 pandemic. Many self-employed are luckily included in the relief measures made available to poor Americans. It pays to see if you are self-employed if you qualify for a $1,000 grant under the EIDL scheme. Usually, within three days of your application being submitted, you’ll get your money, unless you can experience volume-dependent delays.
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