Many small business owners are asking, will the SBA have the new EIDL grant? There’s good news and bad news… The EIDL advance will not return. However, the new grant program is called the Targeted EIDL. This is a grant to give small business owners up to $10,000 grant. Let’s understand the program to see if your business qualifies and when can you expect to receive the funds.

EIDL Advance vs Targeted EIDL Advance

In order to distinguish the EIDL Advance from the Targeted EIDL Advance, we first must understand both programs.

The EIDL Advance was an initiative apart of the CARES Act to help stimulate the economy. That program is no longer available. It was a program that initially started as a method to give business owners up to $10K. This bump was from the tail end of the EIDL loan application. Most business owners were upset as the program started to run out of funds. Therefore, in an effort to fund more businesses, the SBA threw a curveball and changed the $10K advance to $1K per employee up to 10 employees. This meant, a single employee business only received $1,000 grant on top of the EIDL loan. Towards the summer of 2020, the EIDL grant funds completely exhausted and new applicants were only eligible for the loan portion.

What is the Targeted EIDL Advance?

The Targeted EIDL Advance is a grant. Meaning, you do not have to pay it back. The new advance is designed to give previous applicants the missing $10K difference. The owner of The Shanil Luxe Collection applied for the EIDL grant in May of 2020 and only received $1,000 as a single employee company owner. The EIDL grant 2nd round would allow this business owner to receive another $9,000- making the difference for her to receive the full $10,000 grant. If your business received all $10K via 10 employees, then you will not receive the Targeted EIDL advance.

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

The Targeted EIDL was funded with the latest stimulus bill on December 27, 2020. There are some criteria to qualify for the new EIDL grant. Your business must be:

• Located in a low-income community.
• You can demonstrate more than 30% reduction in revenue during an 8-week period beginning on March 2, 2020, or later.
• And have less than 300 employees.

So, what do you need to do to qualify? If you received the EIDL grant for less than $10K, then you don’t have to do anything. There’s no need to fill out another application. The SBA will reach out to applicants on file. And since money will start flowing again, we need to be conscious of scammers. Hence why they state communique will only come from an @sba.gov email address.

Frequently Asked Questions

Update 2/1/21: the SBA has published more FAQs for the Targeted EIDL grant. See answers to your burning questions below…

Can I apply now?

Applicants must wait until they receive an email invite from the SBA to apply for the new Targeted EIDL Advance (via an @sba.gov email address. Please avoid scammers.)

This will be administered in two priority groups. The first, those businesses that received an EIDL grant less than $10,000 from their previous application. The second, are applicants who applied before December 27, 2020, but did not receive an EIDL Advance because available funding was exhausted in mid-July 2020.

When will I receive the Targeted EIDL Advance?

When will the SBA begin sending email invites to the first priority group?

The SBA will begin sending email invites to businesses and nonprofit organizations that received the EIDL Advance in an amount less than $10,000 starting on February 1, 2021. It may take several weeks before all emails are sent to businesses in the first priority group so please do not be alarmed if you do not receive your email invite right away. The invite to apply will be sent to the primary contact email address associated with your original EIDL application. All communications from SBA will be sent from an official government email with an @sba.gov ending.

When will the SBA begin sending email invites to the second priority group?

The SBA will closely monitor the rate of applications and approvals for the first priority group and will announce a projected start date for the second priority group at a later date.

Does the SBA plan to open up the program to new applications beyond the first two priority groups?

Currently, there are no plans to open the Targeted EIDL Advance program to new applicants beyond the first two priority groups. The SBA’s ability to accept new applications for the Targeted EIDL Advance program will depend on the availability of funds, which the SBA will closely monitor. Any changes to application availability will be announced on www.sba.gov/coronavirusrelief

How do I qualify for the advance?

You must first need to have filled out your initial application before December 27, 2020. Then you should have received less than $10K grant.

Furthermore, your business should have less than 300 employees, demonstrate a 30% reduction during the pandemic, and be located in a low-income community. If you want to check to see if your business is located in a low-income area here.

My business received $10,000 EIDL grant the first time. How much money will I receive this time?

Unfortunately, your business has received the maximum grant amount. Therefore, you will not qualify for the new EIDL advance.

My business received $9,000 EIDL grant the first time. How much money will I receive this time?

You should receive $1,000.

What if I didn’t receive any grant last time (only the loan.) Will I receive $10,000?

Unfortunately, the text is not clear about that. It only states those who received $1,000 to $9,000 from the previous application will be contacted first. My hope is that this group will be next in line. Even more wishful thinking is that there are enough funds for brand new applicants who have not filled out the form at all. Stay right here, stay mixed in for updates as we receive them!

Are EIDL grants taxable?

No! The legislation is clear that EIDL advances are not taxable.

While I’m waiting, what are some things I can do to prepare to apply?

If you have not yet filed your 2019 Federal Tax Return, you should complete that process. You will also be required to provide the business’ monthly gross receipts for each month from January
2019 through the most recent month-to-date period. This information will be used to determine that your business meets the greater than 30 percent reduction in revenue requirement during an
8-week period beginning on March 2, 2020.

What documentation will I need to provide?

Applicants who meet the low-income community criteria will be asked to provide gross monthly revenue for January 2019 through the most recent month-to-date period (all forms of combined monthly earnings received, such as profits or salaries) to confirm the reduction in revenue. They may also be asked to provide an IRS Form 4506-T to allow the SBA to request tax information on
the applicants’ behalf. Tax verification process and requirements for businesses in U.S. territories may differ.

If you have any questions about the targeted EIDL, ask in the comments below!