COVID-19 Funding – Loans and grants

COVID-19 business relief payments information

From the Minnesota Department of Revenue

The Minnesota Department of Revenue will send COVID-19 Business Relief Payments to eligible businesses under an economic relief package signed into law December 16.

Eligible business owners do not need to take any action to receive this aid. We'll determine eligibility and payment amounts based on program requirements in the law and outlined below.

Eligible Businesses 

This program provides direct payments to eligible businesses required to temporarily close or reduce services in November under Executive Order 20-99. Businesses in the following categories — as reported by the Minnesota Unemployment Insurance program — may be eligible if they meet the other program requirements: 

• Full- and limited-service restaurants
• Cafeterias and buffets
• Caterers
• Bars
• Breweries with taprooms
• Family wineries with tasting rooms
• Distilleries with tasting rooms
• Bowling centers
• Gyms and fitness centers

Program Requirements

The Department of Revenue will send payments to eligible businesses that meet the rest of the program requirements:

• Located in Minnesota
• Had at least $10,000 in taxable sales in 2019
• Filed monthly or quarterly Sales Tax returns in 2019 and 2020
• As of November 1, 2020, had filed all sales tax returns due through September 2020
• Experienced a 30% drop in year-over-year taxable sales (April-September)
• Required to temporarily close or reduce services by  Executive Order 20-99

Relief Payment Amounts

Eligible businesses will receive a payment based on their Unemployment Insurance data. The amount depends on their average number of employees for the period of November 1, 2019 – January 31, 2020. The payments are considered taxable income.

Qualifying small businesses not in the state’s Unemployment Insurance system will receive $10,000.

Payment Process

• The Minnesota Department of Revenue will determine what businesses are eligible and their aid amount based on their sales tax and unemployment records as of November 1, 2020. 
• The Minnesota Department of Revenue will notify eligible businesses though their e-Services account by December 31, 2020. You do not need to apply. (We're working on a process for businesses to dispute their payment amount and will post information here when it's available.) 
• The Minnesota Department of Revenue will mail payments to eligible businesses in early-January 2021, to the mailing address on their Sales Tax account. Electronic payments are not available for this program.

More Information
The latest payment and program information can be found here.

On January 5,  Minnesota Department of Employment and Economic Development released applications for Movie Theater and Convention Center Grants established in the recent state COVID-19 relief package.

The links to applications and information on the three new programs included in Minnesota’s small business relief package, signed into law December 16, are:

• Minnesota Convention Center Relief Grant Program – This temporary program was established to provide economic relief for convention centers adversely affected by the COVID-19 pandemic. This program will make grants of up to $500,000 to eligible convention centers located in Minnesota. DEED will administer this program. All convention centers interested in receiving a relief grant must submit a completed application by Jan. 29. Applications are available here.
• Minnesota Movie Theater Relief Grant Program – This temporary program was established to provide economic relief for movie theaters adversely affected by the COVID-19 pandemic. This program will make grants of up to $150,000 to eligible movie theaters located in Minnesota. DEED will administer this program. All movie theaters interested in receiving a relief grant must submit a completed application by Jan. 29. Applications are available here.
• County Relief Program – We are working closely with Minnesota counties to disburse money. All counties must apply. More information is available here.

Funding – Loans and grants

• U.S. Small Business Administration (SBA) guidance for employers – Links to information on small business products and loans, guidance on access to capital and the local assistance directory. 
• U.S. Small Business Administration disaster loan application – Minnesota businesses now eligible as of Saturday, March 21.
  • Forms to Fill Out FIRST. Here's a list of documents you'll need to provide to complete the application: 
  • SBA Form 5 or SBA Form 5C for sole proprietorships – SBA loan application 
  • IRS Form 4506T – Tax Information Authorization for the applicant, principals and affiliates.
  • Complete copies of the most recent Federal Income Tax Return. 
  • SBA Form 2202 – Schedule of Liabilities.
  • SBA Form 413 – Personal Financial Statement.
  • SBA Form 1368 – Monthly sales figures 
• SBA Guide to Economic Injury Disaster Loans – download forms to apply, and more.
  • Have questions about these loans, please watch this video to answer some FAQs.
• Congressional summary of CARES Act for Small Businesses
• Coronavirus emergency loans small business guide and checklist from the U.S. Chamber of Commerce
• SBA Economic Injury Disaster Loan Program (EIDL) guide from the U.S. Chamber of Commerce
• Guide to the Employee Retention Tax Credit for COVID-19 impacted employers from the U.S. Chamber of Commerce
• How the U.S. Treasury Department is taking action on COVID-19
• Tax Savings Opportunities from the CARES Act by CliftonLarsonAllen
• DEED guide for small businesses on how to navigate state and federal COVID-19 assistance
• Paycheck Protection Program (PPP) – SBA loan that helps businesses keep their workforce employed during the Coronavirus (COVID-19) crisis.
  • FAQ from U.S. Department of Treasury Paycheck Protection Program
  • Guide to PPP Loan Forgiveness from the U.S Chamber of Commerce
  • PPP Loan Forgiveness: A Step-By-Step Explainer video from the U.S. Chamber of Commerce
• COVID-19 Federal Rural Resource Guide from the U.S. Department of Agriculture
• Guide to the Main Street Lending Program from the U.S. Chamber of Commerce
• Federal Reserve Board expands Main Street Lending Program: Allows more small and medium-sized businesses to be able to receive support
• December 21 COVID-19 federal relief bill small business summary from the Small Business Committee
• Guide to Small Business COVID-19 Emergency Loans - What small businesses need to know about the new pandemic relief package – Changes to PPP and more from the U.S. Chamber of Commerce
• What does the federal relief package mean for Minnesota unemployment insurance - FAQ from DEED
• How to Get Your PPP Loan Forgiven from the U.S. Chamber of Commerce
• PPP First Draw Loans for first time program participants from the Small Business Administration
•  PPP Second Draw Loans beginning January 13, 2021 for certain businesses who have previously received a PPP loan from the Small Business Association
•  COVID-19 Economic Injury Disaster Loans from the Small Business Administration. This loan provides economic relief to small businesses and nonprofit organizations that are currently experiencing a temporary loss of revenue.
•  Shuttered Venue Operators Grant - Emergency assistance throught the SBA for eligible venues affected by the COVID pandemic.

Summary of 501(c)(6) Eligibility in Pandemic Relief Package Expansion of PPP from the U.S. Chamber of Commerce
The final pandemic relief package restarts the Paycheck Protection Program (PPP) and expands PPP eligibility to include 501(c)(6)s. The language begins on page 2102 (in the PDF) and can be found here. The authority to make new PPP loans will terminate on March 31, 2021. We expect the pandemic relief bill to become law this week.
501(c)(6) organizations are eligible to receive a PPP loan provided:

• They are not a professional sports league or organized for the purpose of promoting or participating in a political campaign (Note: this will not impact chambers of commerce or trade associations);
• They do not employ more than 300 employees;
• They do not receive more than 15% of their receipts from lobbying activities;
• Lobbying activities do not compromise more than 15% of the organization’s total activities; and
• The cost of the lobbying activities of the organization did not exceed $1,000,000 during the most recent tax year that ended prior to February 15, 2020.

If an organization fails any of these tests they are NOT eligible to receive a PPP loan.

Similar rules apply to Destination Marketing Organizations.

Lobbying activities are not defined in the section. The Small Business Administration may provide a definition or guidance. Congressional staff have used information available in the 990 tax form when discussing the impact of the 15% lobbying activities limitation.  Specifically, staff have compared the lobbying expenses reported on schedule C, Part III-B, Line 2 with the total expenses reported for the year (Page 1, line 18).  (Note that these lines may be different if you are using a 990 form vs. 990EZ.)

Absent further guidance, organizations may wish to analyze their most recent 990 to determine whether they may be eligible to apply for a PPP loan and may wish to proceed with their lender if they believe they do qualify.

The bill also expands allowable uses for PPP funds and simplifies the loan process.  We will be providing separate information on the other PPP changes.