Breaking Down EIDL & PPP For Small Businesses

The Economic Injury Disaster Load has provided over 3.7 million businesses the financial resources to stay afloat during difficult, disastrous times.

Breaking Down EIDL & PPP For Small Businesses

The Economic Injury Disaster Loan (EIDL) program assists small businesses by ensuring operating expenses and other financial obligations will be upheld by the granted business in an economic crisis.

The Economic Injury Disaster Load has provided over 3.7 million businesses the financial resources to stay afloat during difficult, disastrous times. If you are in a situation where your business needs a little extra help, an Economic Injury Disaster Loan might be the best avenue to pursue.

Do I Qualify?

To be granted the Economic Injury Disaster Loan, your business must be one of the following:

  • A Small business
  • A Small agricultural cooperative
  • A private nonprofit organization

The Small Business Administration is strict about these loans because a business must prove that it has exhausted efforts getting credit elsewhere. So be prepared to have these documents available in hopes of a quicker application and payment opportunity.

Looking For The Application:

The application process can be kick-started by clicking here.

What EIDLs Can Cover

Economic Injury Disaster Loans help cover operating expenses if a business has no other outlets to receive credit. These loans can be up to $2 million if approved. With a guarantee of an interest rate under 4%, small businesses can benefit drastically from this assistance. EIDLs are specifically used to cover working capital, everyday operating expenses, continuing health care benefits for employees, office space rent, business utility bills, and fixed debt payments.


All disaster loans received in 2021 have been extended from 12 months to 18 months until the first payment is due.

What is the PPP?

The Paycheck Protection Program (PPP) is a part of the CAREs Act (The Coronavirus Aid, Relief, and Economic Security Act), a bill providing $2.2 trillion in economic assistance and stimulation initially signed into law March 2020.

However, PPP ended May 31, 2021. After two waves of funding and financial assistance, this program has ended. However, there are still loan relief programs available to support small businesses transitioning back from COVID-19. If you were unable to receive or did not apply in time and under current financial distress, looking into The Economic Injury Disaster Loan (EIDL) may benefit your business.

Who Could Qualify?

The parameters for applying for a Paycheck Protection Program Loan may differ from those seeking an Economic Injury Disaster Loan. These individuals include:

  • Self-employed individuals
  • Small business with under 500 employees (per location)
Application Process:

The process of applying for the Paycheck Protection Program may be up to five months, so it is essential to be well prepared in advance. After filling out the application, it gets sent to a specific lender, who has 60 days to approve your application and pass it along to SBA (Small Business Administration). From there, the Small Business Administration has 90 days to determine final forgiveness and contact the lender, who then gets in contact with you. While bottlenecks in the system can occur, having a financial cushion can provide long-term support. Regardless of whether you have applied for an EIDL or PPP, it is always essential to remember deadlines and look into additional opportunities for support.

A Look Into Taxes

The IRS does not consider Paycheck Protection Program taxable income; however, varying states may have different regulations. In addition, expenses paid with PPP cannot be counted as tax-deductible. Therefore, ensuring a deeper understanding of PPP and the legalities is crucial to making financially healthy decisions.

Small Business Opportunities

The life of every business comes down to operational efficiency, innovative industry strategies, and confidence in your knowledge. Therefore, some companies would benefit from a Fractional CFO, specifically designed to help optimize projects and have industry expertise. Helping solve financial pain points, this is an opportunity to invest and gain knowledge support that helps save money long term.