In addition to the first and second PPP forgivable loans and the ERTC payroll tax refunds, restaurants can access even more needed money.

Back in March 2020, when the CARES ACT was first passed, you could apply for and obtain an EIDL (Economic Injury Disaster Loan) for up to $150,000.  These loans had very advantageous terms, were easy to obtain, and had deferred principal and interest for 12 months, a 3.75 percent interest rate for 30 years.

Just recently, in September 2021, the EIDL was expanded to increase funding to a maximum $2 million per loan.  The expansion changes also include extending the 12-month deferral to 24 months for loans made in 2020 and 18 months for loans made in 2021.  Interest continues to accrue during the deferment period.

EIDL money can be used for any normal operating costs

EIDL money can be used for any normal operating costs including debt payments which the business is unable to pay because of the disaster.  For most restaurants, because we are still experiencing the effects of the pandemic, the funds can be used until normal operations resume. 

The funds cannot be used for:

• Expansion of facilities or acquisition of fixed assets
• Refinancing long term debt
• Repair or replacement of physical damages
• Paying profits, dividends, or owner distributions
• Employee bonuses
• Repayment of owner loans except if the loans were injected because of the disaster.

You can use EIDL funds to;

• Pay yourself for actual hours worked
• Pay off credit cards if they were used for business expenses
• Pay normal monthly rent to yourself if you own the building.