One of 2020’s bright spots (yes there were a few) came as the year drew to a much awaited close. On December 27th, the president signed the Consolidated Appropriations Act, 2021 into law. This law covers a lot of ground, but its primary emphasis is to bring another round of financial relief for a nation still struggling to survive amidst the unrelenting coronavirus crisis. Several items in this package will benefit our farm and ranch communities.
Another infusion of cash payments ($600 for individuals earning less than $75,000) will help shore up personal income for farmers and ranchers. An extension of the pandemic unemployment insurance program (11 additional weeks of eligibility and an additional $300 per week from the feds) will continue to help our farm owners suffering a significant drop in personal income as well as farm workers who were paid as independent contractors. The paid coronavirus-related sick and family medical leave program is also extended through March 2021. This means farmers should continue to take note of their legal obligations to provide paid sick time to workers contracting the virus or caring for family members suffering from it.
The Economic Injury Disaster Loans (EIDL) program is also here again, and farmers are eligible (there was some confusion about this the first time around). Small businesses can apply for loans up to $10,000, which are actually grants as they don’t have to be paid back. These grants have been awarded, however, at $1,000 per employee. Small businesses can ask for more than the $10,000, but amounts beyond the $10,000 are loans to be repaid at an interest rate of 3.75%. The exciting part about EIDL Version 2.0 is that while previously, any EIDL money a business received would reduce the amount of PPP monies that could be forgiven. Now, if you receive both PPP and EIDL money, your EIDL does not reduce the amount of PPP that can be forgiven. Also, the law clarifies that the EIDL monies are non-taxable income.
Perhaps the most exciting part of the new stimulus package is the availability of new PPP funds. The new program is full of many changes, and we get into that in the next article.
For more information about the stimulus package, see this New York Times article.