Last week, Governor Tate Reeves signed a bill to provide $300 million in relief to small businesses in Mississippi. The $300 million is part of the federal relief provided to states in the CARES Act passed in Washington on March 25.
The Mississippi relief bill outlines two programs for businesses. The first program is an automatic stimulus payment of $2,000 to businesses in certain industries that were temporarily closed by government order. This will include most retail establishments, schools, day care centers, restaurants, theaters, barbershops, salons and gyms. To receive the payment, the business must have filed Mississippi income taxes for either 2018 or 2019. If the business was formed in 2020, it must plan to file Mississippi income taxes for 2020. Sixty million dollars is set aside for this program. Business owners do not have to apply for this payment.
The second relief program provides $240 million for grants of up to $25,000 for businesses with less than 50 employees. The grants will cover mortgages, rent, utilities and payroll costs, as well as expenses incurred due to the coronavirus. The grants are not intended to replace lost revenue. Mississippi Development Authority is responsible for the application process. For the first 21 days, applications will be limited to businesses that did not receive a Payroll Protection Program loan. During the initial 60-day window, $40 million will be reserved for minority-owned businesses.
Certain businesses are excluded from applying for the relief grants. These include businesses that derive their income solely from passive investments, lobbyists and businesses that hire lobbyists or businesses that advance partisan political activities. Applicants for these grants must meet the same tax filing criteria as the first program. As of May 26th, the grant application has not been made available.
If you have questions or need help with a grant application, call your GranthamPoole advisor. As businesses begin to re-open, we are here to help.
Stephanie B. Smith, CPA, CFF
Stephanie B. Smith is a member of GranthamPoole PLLC and a recognized leader in the fields of business valuation and litigation support. She has also written, taught, and spoken on many topics in the area over the years and has served as a technical advisor and testifying expert in numerous cases. Please contact Stephanie at firstname.lastname@example.org or 601-499-2400. CPA License # 3657
***The above does not represent tax advice. Each situation is fact-dependent, and you should seek the advice of a competent advisor. GranthamPoole PLLC is a provider of tax, accounting, advisory and strategic services, partnering with clients across a broad spectrum of industries and sizes.