California is providing broad assistance to small businesses and employers impacted by COVID-19. This includes:
- Small business interest free deferral of sales/use tax up to $50,000 for businesses with less than $5 million in taxable sales.
- Federal small business stimulus programs:
- 90-day extension on all businesses filing a return for less than $1 million in taxes
- California Small Business Loan Guarantee Program (via IBank) $50 million in state funding, providing potential capital for individuals who do not qualify for federal funds.
Questions and Answers
Tax Relief for Small Businesses
What do taxpayers need to do if they want to take advantage of relief from the California Department of Tax and Fee Administration?
Interested taxpayers should contact CDTFA by visiting cdtfa.ca.gov or calling 800-400-7115.
When will taxpayers start on these payment plans?
Given that the April deadline to file and pay sales and use tax returns has been extended to late July for all but the largest taxpayers, CDTFA expects that most participating taxpayers will begin their payment arrangements in late July of this year.
How will the payment plans work?
Qualifying sales and use taxpayers with deferred liabilities up to $50,000 will pay their tax due in 12 equal monthly installments. No interest or penalties will be assessed against the liability.
Is this only for tax payments due for the 1st quarter of 2020?
If taxpayers choose to use this program to distribute the burden of their May or June prepayments or their July return, CDTFA will work to accommodate those taxpayers.
What if taxpayers owe more than the $50,000 limit on the relief?
The maximum amount that any taxpayer can defer interest-free under this relief effort is $50,000.
What if taxpayers with more than $5 million in annual taxable sales need this relief?
We recognize that some taxpayers, particularly in low margin businesses, with annual taxable sales over $5 million may also need this relief. Those taxpayers are encouraged to reach out to CDTFA, which will work with them to provide relief where appropriate.
Is the deadline for filing California tax returns extended?
Yes. All California taxpayers (individuals and businesses) can file and pay by July 15, 2020.
See information from the CA Franchise Tax Board for more information.
California Small Business Loan Guarantee Program
How can an interested borrower access these loans?
The Small Business Finance Center partners with Financial Development Corporations (FDC’s) and Community Development Financial Institutions (CDFIs) to provide loan guarantees for small businesses. Visit https://www.ibank.ca.gov/small-business-finance-center/ to learn how to apply.
What is the timing for the funding of loans?
The program is already in place and businesses can apply immediately.
U.S. Small Business Administration Stimulus Programs
How does a small business get the $10,000 advance through the Economic Injury Disaster Loan program?
In order to request the advance of up to $10,000, eligible businesses must apply for the SBA’s Economic Injury Disaster Loan Program at sba.gov. SBA has simplified the application, and as of Monday, March 30th, the loan and loan advance can both be requested through the Small Business Administration. Businesses who have applied before March 30th will need to reapply or contact SBA for assistance.
Which banks are offering the Paycheck Protection Program forgivable loans?
Interested borrowers can contact any SBA participating bank, credit union, or nonprofit lenders. For more information, contact your local bank or reach out to SBA’s local district offices for assistance.
Where do I find more information on the allowable expenses for a forgivable loan under the Paycheck Protection Program?
SBA is finalizing detailed guidelines for lenders. You can visit sba.gov for more detailed program information.
Are the SBA programs available to small businesses right now?
The Economic Injury Disaster Loan (EIDL) is available for you to apply right away. The Paycheck Protection Program (PPP) will be available for small businesses and sole proprietors beginning April 3. Independent contractors and self-employed can apply April 10th.
How do I reach SBA for any questions or assistance?
SBA has district offices throughout the state that are open to answer questions and they can be found on the SBA website. You can also reach SBA at a 24hr Customer Service Center at: 1-800-659-2955 / 1-800-877-8339 (TTY), or you can contact the SBA by email at: email@example.com.
How does a business know if it is eligible for an SBA loan or loan guarantee program?
Small business with 500 or fewer employees are eligible to apply for the Economic Injury Disaster Loan (EIDL), the Paycheck Protection Program (PPP), and/or the Small Business Debt Relief Program. Visit SBA’s comprehensive COVID-19 support website to find out more about SBA’s eligibility requirements.
How does a small business know which SBA loan or loan guarantee program is the right one? Can a small business apply to more than one?
The SBA is offering a variety of capital assistance programs to suit the range of needs for small businesses. SBA has a 24hr Customer Service Center at: 1-800-659-2955 / 1-800-877-8339 (TTY), or you can contact the SBA by email at: firstname.lastname@example.org. It is important to note that while businesses can apply for and receive more than one form of capital assistance through the SBA, they cannot be used for the same purpose.
How do I get SBA to cover my loan payments on my existing 7(a), 504, or microloan if I cannot pay due to COVID-19?
SBA has a Debt Relief program and will pay the principal and interest of existing SBA loans. Please contact your lender for information.
If I need help to figure out which program is best for me or to get help submitting an application, where can I find support?
California’s network of small business support centers help businesses figure out which loans and programs are best for them, develop resiliency strategies, and find other resources. To find the closest center, go to: business.ca.gov/centers.
How do I maintain a safe workplace?
- If your business is in an essential sector and remaining open during the stay home order, you should take steps to ensure the safety and health of your workers
- Encourage sick employees to stay home.
- Establish routine cleaning throughout the workplace.
- Reduce travel. If possible, encourage video conferencing and limit larger gatherings.
- See Cal/OSHA Interim Guidance for General Industry.
- Follow CDC guidance on keeping the workplace safe (pdf).
What precautions should healthcare workers and organizations take?
How can I avoid laying off employees if my business is impacted by COVID-19?
Apply for the Unemployment Insurance (UI) Work Sharing Program.
Stay Home Order
What businesses and organizations are exempt from the stay-home-order?
Businesses and organizations that provide critical infrastructure for the state are exempted, including health care and public health, public safety, food and agriculture and media. See the full list of exempt sectors (pdf).
I run/work at an exempted business or organization, as defined by the Stay home order. Do I need to get an official letter of authorization from the state to operate?
No. If your business or organization is in the list of exempt sectors, it may still operate. You do not need to obtain any specific authorization from the state to do so.
- CA Labor and Workforce Development Agency: Coronavirus 2019 (COVID-19) Resources for Employers and Workers
- CA Employment Development Department: Coronavirus 2019 (COVID-19)
- Governor’s Office of Business and Economic Development: Coronavirus 2019
- California Department of Tax and Fee Administration: COVID-19 State of Emergency
- Cal/OSHA Guidance on Requirements to Protect Workers from Coronavirus
- Coronavirus Disease (COVID-19) – FAQs on laws enforced by the California Labor Commissioner’s Office
- U.S. Internal Revenue Service: Coronavirus Tax Relief