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When can I apply for an EIDL grant in 2021? (check back for updates!)

IMPORTANT UPDATE (as of Tuesday, January 19, 2021): Congress has approved a new round of funding for 2021, which re-funds the emergency relief package for America’s small businesses. The 2021 package contains roughly $284 billion to replenish the Paycheck Protection Program (PPP), an additional $20 billion for the EIDL program, in addition to allowing new types of businesses access to these funds. PLEASE NOTE: THE EIDL ADVANCE PROGRAM IS NOT CURRENTLY OPEN FOR NEW APPLICATIONS. The SBA is focusing first on Targeted EIDL Advances (see below) to people who applied for the EIDL program last year but were underfunded or unable to receive an EIDL grant due to lack of program funding. There haven’t been any announcements about when businesses may start to apply for new EIDL grants/advances. We anticipate updates on this program over the coming weeks. We expect the EIDL advance program to re-open in early February, 2021, starting with Targeted EIDL Advances.

The PPP Loan program, however, is currently taking applications for First and Second Draw loans! Under the new terms of the PPP for 2021, you may apply for a “second draw” PPP loan even if you were approved and funded for a PPP loan in 2020. In addition, there are new terms and expenses that are covered under PPP loans and are forgivable, and these terms apply to previous PPP loans if they haven’t been forgiven yet. See this article for more details.

On Monday, March 30, 2020, the U.S. Small Business Administration launched a disaster loan assistance program that awards $10,000 grants to eligible American small businesses. If your business has been impacted by the novel coronavirus (COVID-19), it’s important to apply for these grants as soon as the program opens up again.

For context, on March 27, 2020, the U.S. Congress passed the CARES Act. Part of this landmark legislation included a $10 billion appropriation for U.S. businesses under the emergency Economic Injury Disaster Loans (EIDL) provision.

This guarantees that eligible businesses in the U.S. will receive $10,000 grants within three days of applying. There are very few strings attached — even if you do not qualify for a larger loan, this $10,000 will be yours to keep so long as you meet basic eligibility requirements.

What’s the difference between an EIDL advance, a “targeted EIDL advance,” and an EIDL loan?

The SBA has offered both loans and “grants” or advances under the EIDL program, including a “targeted EIDL advance” in December, 2020 intended to provide businesses “located in low-income communities with additional funds to ensure small business continuity, adaptation, and resiliency.”

This targeted EIDL Advance applies only to applicable businesses located in low-income communities who already applied for and previously received an EIDL Advance for less than $10,000, or those who applied but received no funds due to lack of available program funding. If you don’t fit into this category, you don’t qualify for a “targeted EIDL advance.” The SBA is currently reaching out to businesses who qualify.

The SBA will first reach out to businesses that already received a partial EIDL Advance (between $1,000-$9,000). Applicants will be contacted directly by the SBA via email in the coming weeks with instructions to determine eligibility and submit documentation.

Applicants may qualify if they are located in a low-income community AND can demonstrate more than 30% reduction in revenue during an 8-week period beginning on March 2, 2020, or later.

Next, the SBA will reach out to those who applied for EIDL assistance on or before December 27, 2020, but did not receive an EIDL Advance due to lack of program funding. These applicants will receive an email from SBA with instructions to determine eligibility and submit documentation. Applicants may qualify for a Targeted EIDL Advance if they meet the above criteria (low-income location and reduction in revenue) AND have 300 or fewer employees. Again, the SBA will reach out to you if you qualify.

An EIDL ADVANCE is not currently available, but we expect the program to be reopened soon, after the SBA completes their assessment of people eligible for “targeted EIDL advances” discussed above. An EIDL Advance is a forgivable advance of up to $10,000 that was originally calculated based on the number of employees indicated on an applicant’s COVID-19 EIDL application: $1,000/employee, up to a maximum of $10,000.

  • EIDL Advance does not have to be repaid.

  • Recipients did not have to be approved for an EIDL loan to receive the EIDL Advance.

  • The amount of the loan Advance was deducted from total EIDL loan eligibility.

  • Contrary to how it originally worked, businesses who received an EIDL Advance in addition to the Paycheck Protection Program (PPP) loan will no longer have the amount of the EIDL Advance subtracted from the forgiveness amount of their PPP loan.

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