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Economic Injury Disaster Loan vs Paycheck Protection Program Loan

Updated 4-1-2020


Key provisions for our clients and friends

Economic Injury Disaster Loan expansion and the Payroll Protection Program

As of March 27, 2020, all 50 states were declared as states needing direct assistance provided by the Economic Injury Disaster Loan (EIDL) declaration. These loans are designed to help small businesses meet their ordinary and necessary financial obligations that cannot be met as a direct result of the disaster. The EIDL differs from the Paycheck Protection Program (PPP) in a number of ways as summarized in the table below.


Additionally, we wanted to point out for our clients and friends, the key provision of the CARES Act establishing the Emergency EID Grant, which serves as an advance on the EIDL loan. The Emergency EIDL Grant is applicable for the following entities:

  • A business, ESOP, cooperative, or tribal small business concern with less than 500 employees

  • Sole proprietors and independent contractors

  • Private nonprofit organization

  • Small agricultural cooperatives


This grant provides a cash advance of up to $10,000 within 3 days of application, and repayment is not required, even if subsequently denied a loan. The advance must be used to:

  • Provide paid sick leave to employees unable to work due to the direct effect of the COVID–19;

  • Maintain payroll to retain employees during business disruptions or substantial slowdowns;

  • Meet increased costs to obtain materials unavailable from the applicant’s original source due to interrupted supply chains;

  • Make rent or mortgage payments; and

  • Repay obligations that cannot be met due to revenue losses.


We at TJ Advisors are committed to bringing you the most relevant and up to date information in an effort to help your business stay on track during this period of uncertainty. Please note that not all provisions, exceptions, exclusions, and special circumstances are included in order to maintain brevity. Please reach out directly so that we can provide the business support you need in these unprecedented times. We are here for you, contact us today at or 972-629-9164.

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