Federal Funding for the Independent Workforce

Federal Funding for the Independent Workforce

If your business as an Independent Worker is suffering, there is some good news.


The federal government has taken swift action to address this crisis and included within the massive coronavirus relief bill are programs, loans and direct payments, specifically designed to protect the Independent Workforce during these challenging times. This includes new access to unemployment insurance, incentives to maintain payroll, expanded disaster relief loans and a guaranteed income to all U.S. federal income taxpayers. Accessing this assistance quickly will ensure that you can protect you and your business throughout the duration of this crisis.


The information below details how you can take advantage of the following resources as an Independent Worker.

  • Payment Protection Program

  • SBA Emergency Economic Injury Disaster Loans

  • Pandemic Unemployment Assistance

  • Direct stimulus checks

Payment Protection Program


The CARES Act created the Payment Protection Program, an emergency lending facility, administered by the Small Business Administration. Its purpose is to help small businesses cover their operating expenses through the crisis and provide a strong incentive for these businesses to retain their workers.


  • The program provides $350 billion for 100% federally guaranteed loans for up to 8 weeks of assistance for small businesses.

  • All sole-proprietors, independent contractors and gig economy workers are eligible for these loans.

  • There is no cost to apply, no personal or business collateral required, and the loan can be forgiven if you follow the terms.

  • Through this program, any small business is able to borrow 250% of their average monthly payroll expenses, up to $10 million.

  • You can cover eight weeks of payroll expenses, rents or mortgages, utilities, and any other debt obligations.

  • Your loan can be forgiven after 8 weeks if all funds were used for qualified operating expenses.


You can apply for the Paycheck Protection Program through the existing Small Business Development center site which provides their lender match tool. The SBA will issue further guidance on the details of this program soon.


Find your local Small Business Development Center here.

SBA Emergency Economic Injury Disaster Loans


The SBA’s Economic Injury Disaster Loans have also been expanded to offer low interest loans for up to $2 million to distressed businesses during the COVID-19 crisis. We strongly encourage you to apply now.


Any small business in the United States which has been impacted by COVID-19 is eligible. The definition used by the SBA of a small business varies by industry, but generally, any business with fewer than 500 workers is defined as a small business.


  • SBA is offering loans through their Disaster Loan Program; amounts can range from a few thousand dollars to cover short term expenses – up to $2 million for long term contingency and stagnation in business.

  • According to the SBA, the interest rate is 3.75%.

  • The money can be applied to cover business operating expenses, such as payroll, accounts payable or debts.

  • SBA states that it may take between 8 and 21 days to process the loan application


Visit: https://www.sba.gov/funding-programs/disaster-assistance and apply online through their three-step process.

Pandemic Unemployment Assistance


Included within the CARES Act was an expansion to Unemployment Insurance to those who normally do not qualify for UI – Independent Workers.


Through the creation of the Pandemic Unemployment Assistance, the self-employed, independent contractors, freelancers and gig workers of America who face a loss of income due to the COVID-19 crisis now have an ability to access unemployment.


You'll get the $600 per week, plus half the average unemployment benefit in your state – this will be provided for up to four months. To access these funds – apply through your state’s unemployment agency over the phone or online. States are strongly recommending people file online due to the high volume of calls many agencies are experiencing. These benefits usually take two to three weeks to be processed.


You can find your state’s unemployment office website here.

Direct Stimulus Checks


And finally, the much-discussed direct payments will go to all taxpayers with amounts based on the income found on either their 2019 or 2018 federal income tax return. Taxpayers with adjusted gross incomes up to $75,000 ($150,000 for married couples) will get a $1,200 ($2,400 for couples) onetime payment, with families receiving an additional $500 per child. However, the payments will start to phase out for individuals with adjusted gross incomes greater than $75,000. Those with incomes higher than $99,000 will not qualify for payments under the stimulus package.


Payments will be sent the same way you received your last tax refund – either through direct deposit, or a mailed check.


The IRS could start issuing payments within three weeks, said Treasury Secretary Steven Mnuchin. No set schedule has been announced but people who have filed their 2019 returns with direct deposit information will receive their checks fastest.


The IRS will be providing all updates on payment schedules through their COVID-19 resource page.

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The Association of Independent Workers

535 Griswold Street Suite 111-556 Detroit, MI 48226

1341 G Street, NW  Suite 1100 Washington, DC 20005

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