August 28, 2020
Dear Clients & Friends,
We hope that you are doing well during this time. As most of you are aware, our office is remaining open during this time and we are here to answer any questions you may have. We are working diligently preparing tax returns and assisting our clients throughout the COVID-19 pandemic.
On August 19, Governor Carney announced a new $100 million small business grant program backed by funds from the federal government and the CARES Act. The grant program, called DE Relief, is being administered by the Delaware Division of Small Business. The grant program is aimed at essential and non-essential businesses who have incurred additional expenses or reduced their resources to adapt to the new restrictions brought on by COVID-19.
The grant is a reimbursement-based grant, meaning applicants need to have either incurred a cost or plan to do so. The grant can be used for the following: purchasing equipment to make a workplace suitable for COVID-19 safety, such as personal protective equipment, plexiglass, air purifiers, etc., refinancing of debt incurred due to COVID-19, including loans from the state’s HELP program, advertising efforts undertaken as a result of the pandemic, and fixed expenses accrued during the crisis.
The Division of Small Business will begin accepting applications in early September and there will be three application rounds in September, October and November. Businesses with NAICS codes 44, 45, 6116, 6244, 71, 72, 8121, and 8129 are considered disproportionately impacted and will receive additional considerations in the grant application process, however, the grant program is open to all qualifying small businesses.
All grants issued to for-profit businesses must be closed out in 2021. In order to close out the grant, a business must submit proof of all relevant expenditures along with federal tax returns for calendar year 2020 that show at least a 7.5% revenue decrease relative to 2019. If a decrease in this amount is not shown, the grant must be paid back to the state with interest applied.
If you are interested in applying, you will need to gather your 2019 tax return, receipts for all qualifying expenses, and a copy of your Delaware business license to submit with the application.
We have attached a print out from the Division of Small Business that may answer any questions you have.
Robert G. Starkey, CPA