Uber drivers, artists, freelancers, here’s how to get an $1,000 from coronavirus stimulus funds

Uber drivers, artists, freelancers, here’s how to get an $1,000 from coronavirus stimulus funds

Americans wait as legislators in Washington D.C. continue to hammer out details of a potential second round of stimulus checks. In the meantime, independent contractors, freelancers, and gig workers whose businesses have been impacted by COVID-19 are eligible to receive a grant of $1,000 from the federal government. That money is thanks to the CARES Act passed on March 27, 2020. The best part: you’ll never need to repay the government.

That’s good news for the 57 million Americans who work as writers, drivers for ride-sharing services, artists, photographers, house cleaners, and in other jobs that provide flexibility but little security.

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Here, we provide answers to some commonly asked questions regarding the $1,000 grants associated with Economic Injury Disaster Loans (EIDL) – part of a Small Business Administration support package.

Am I eligible?

To qualify, you need to have been in business since at least Jan. 31, 2020. If that’s you, you are eligible for a $1,000 grant you fit into one of these four categories:

  • You are the sole proprietor of a business, with or without additional employees
  • You are an independent contractor
  • You are a freelancer
  • You are a gig worker

How do I apply online?

You can apply for a grant through the Small Business Administration website. The process is fast and easy.

What information do I need to provide?

The nice thing about the SBA’s grant application is how little information you need to fill it out. Here is what they ask for:

  • Social Security number
  • Gross revenues for the past 12 months (you may need to estimate this amount based on what you earned in 2019)
  • Cost of goods sold. What they are looking for here is a sense of how much you spent over 12 months of doing business. For example, if you are a freelance painter, your expenses might include tarps, paint, paintbrushes, brush cleaners, business cards, etc. Do your best to estimate this amount.
  • The date the business was first established. Again, if you do not have an exact date, get as close as possible. Remember: These grants are only available to those in business before Jan. 31, 2020.
  • Your business phone number. If you do not have a separate number for your business venture, provide your cell number.

Is there anything to look out for?

We looked for questions that might be confusing or otherwise catch people off guard. Here are a few things to be on the lookout for and how to make sure to get it right.

Business Legal Name and Trade Name: The first two questions ask for the name of your business. If there is no specific legal name, enter your name in both boxes.

Organization Type: Choose “Sole Proprietorship” or “Independent Contractor” from the pull-down menu.

Business Activity: Some jobs do not fit neatly into a job category. For example, if you are a freelance trapeze artist, “Entertainment Services” is the closest you will get to describing your business. Depending on your job, you may find a better description under Detailed Business Activity. If not, that’s fine. Just get as close as you can.

Number of Employees: If you work on your own, the number will be one (in other words, do not forget to count yourself).

Is Your Business Owned by a Business Entity?: At the very top of the second page of the application (and easy to miss) is a question asking you if another entity owns your business. The answer is “no.”

Ownership Percent: Type in 100 to indicate that the business belongs solely to you.

Finally, there are two things to look for on the final page of the application. One question asks if anyone helped you fill out the form. If you filled it out yourself, skip this portion. Just below are the bolded words, “I would like to be considered for an advance of up to $10,000.” Check the box next to it. As an independent contractor, freelancer, or gig worker, you are not eligible for a $10,000 grant, but checking the box indicates that you want the $1,000 for which you qualify.

How do I let the SBA know where to deposit funds?

Oddly enough, we found this to be the trickiest portion of the application. You will need to provide some information about your bank account generally found on checks. The grant application asks for your bank account number first (the series of numbers found at the bottom/center of your paper checks). Next, they ask for the routing number (located at the bottom/left of paper checks).

When will funds be deposited?

The SBA says that you will receive your grant within days of completing your application. That said, there is no real way of knowing how long it will take the SBA to process the scores of applications pouring into their system. Those who have already received grants report that deposits are made with no email notification beforehand. If you are waiting for yours, our best advice is to keep an eye on your bank account.

Are there any strings attached?

Yes, but they are manageable as long as you are aware of them. The $1,000 grant is tucked into an offer for a $10,000 Economic Injury Disaster Loan, so when you fill out the application for the grant money, you are also applying for the $10,000 emergency loan (which, unlike the grant, must be repaid). The good news is, you don’t have to accept the loan when it is offered. As long as you do not sign the loan agreement, the loan offer expires after 60 days. The grant is yours to keep, no matter what. But, because you may be offered a loan along with the grant, a hard inquiry will be run to check your creditworthiness. According to the SBA website, applicants who are not approved for a loan may still receive a $1,000 grant, but it is important to remember that a hard credit inquiry can temporarily drop your credit score up to 10 points (although it is typically less). If you are in the process of taking out a mortgage loan or financing a vehicle, applying for new credit – even if you have no plans of accepting the loan – may not be a good idea.

If recent history is any indicator, these funds will not last long. If you can use a grant to help get you through, now is the time to apply.

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Source: usatoday

Flexgigzz Editor

Author Since: June 19, 2020