Tap into Millions with This Loan Program

Tap into Millions with This Loan Program

What is the 504 loan program?

Want access to millions of dollars to help your business overcome the challenges of the current health crisis? Look no further than the 504 loan program. It provides long-term, fixed-rate financing for major fixed assets that promote business growth and job creation. Generally, these loans max out at $5 million, but can go up to $5.5 million for “Small Manufacturers” and for certain energy projects. 504 loans are available through Certified Development Companies (CDCs), SBA’s community-based partners, and the loan is distributed among three parties. The business owner puts up a minimum of 10%, a conventional lender (typically a bank) puts up 50%, and a CDC puts up the remaining 40%. Most businesses find that when their 504 loan closes, the rate is highly competitive with other financing options, making this an accessible, cost-effective opportunity you may not have tapped into. Ultimately, it’s a chance for you to hold onto as much-coveted working capital as possible.

How could your construction company benefit?

SBA 504 loan money can be used to buy a building, finance ground-up construction or building improvements, or purchase heavy machinery and equipment. You can also use the loan for the improvement or modernization of land, streets, utilities, parking lots and landscaping, or existing facilities.

To be eligible, your business must:

  • Operate as a for-profit company
  • Have a tangible net worth of less than $15 million
  • Have an average net income of less than $5 million after federal income taxes for the two years preceding your application

Additionally, businesses must meet the SBA’s definition of a small business, which typically means fewer than 250 to 1,500 employees. One of the most notable borrower benefits? Because payments are consistent over the term of the loan, the long-term, fixed interest rates make it easier for your company to budget each month. Keep in mind that a 504 loan cannotbe used for working capital or inventory, consolidating, repaying, or refinancing debt, or speculation or investment in rental real estate.

How do you apply?

The first step to apply is to contact your bank to learn more about the program, then prepare and assemble your 504 loan authorization package, using the SBA’s 504 Authorization File Library to identify the documentation you will need to apply for your 504 loan. This past fall, the SBA announced updated interest rates you can take advantage of to bounce back from COVID-19 financial disruptions. The program now allows for 10, 20, and 25-year interest rates as low as 2.2%. On average, the loans take around 30-45 days from application to funding. Approval time can, however, take anywhere from one to six months. Right now because of the Economic Aid Act, all borrower fees are waived through September 30, 2021, which means even more financial savings for your business. So, what are you waiting for? If you still have questions about how to get started, give our team a call today, we are happy to help out and can’t wait to get you access to the capital you need.

Time is Running Out on CAA Tax Breaks

Time is Running Out on CAA Tax Breaks

The clock is ticking on the massive tax benefit extensions that can help manufacturers save big thanks to The Consolidated Appropriations Act (CAA). Want to learn about the savings your business is eligible for? Let’s review some of the time-sensitive highlights you can take advantage of before time runs out.

PPP Round Two

As RBT has mentioned in previous thought leadership pieces, the CAA expanded and revised the PPP, providing $284 billion for the second round. The “second-draw” opportunity allows eligible businesses with fewer than 300 employees to apply. The maximum second-draw loan amount is $2 million, through March 31, 2021, or until funding is exhausted. Plus according to the new law, expenses paid for with forgiven PPP loans are tax-deductible.

Employee Retention Credit

Under the CARES Act, eligible employers could claim the refundable employee retention credit (ERC) for 50% of the first $10,000 of wages paid to eligible employees from March through December of 2020. The CAA extends the ERC through June 30, 2021, and indicates that employers that receive PPP loans can qualify for the ERC. As of 2021, the new law:

  • Increases the maximum credit to $14,000 based on a 70% credit rate for the first $10,000 of qualified wages per quarter, for the first two quarters of 2021
  • Increases the number of employees allowed for eligible employer status from 100 to 500
  • Makes employers that didn’t exist for all or part of 2019 eligible to claim the credit

Work Opportunity Tax Credit

Hiring workers who fall into certain disadvantaged groups? Be sure to claim the Work Opportunity Tax Credit (WOTC), which offers a maximum of $2,400 per employee (or $9,600 for a disabled veteran). This tax break was scheduled to end after 2020. The CAA extends the WOTC to cover first-year wages paid to qualifying employees who are hired in 2021 through 2025. Here is a list of target groups that qualify you for the WOTC credit.

Employer Credit for Sick and Family Leave Payments to Employees

The Families First Coronavirus Response Act (FFCRA) created an employer tax credit to cover the cost of paying for mandatory paid sick and family leave related to COVID-19. Eligible employers can claim a federal payroll tax credit for 100% of qualified leave payments which offsets the employer’s 6.2% Social Security tax component of the federal payroll (FICA) tax. Initially, it was available from April through December of 2020. As the pandemic continues, the CAA extended the credit through March 31, 2021.

Payroll Tax Deferral

You may remember that because of a 2020 presidential executive order, an employer could choose to postpone payment of the 6.2% Social Security tax component of FICA tax withheld from qualified employee wages of less than $4,000 for a biweekly pay period. Previously, the employer had to deposit the deferred tax amount with the IRS by April 30, 2021, but the CAA now extends the payment deadline for employers to December 31, 2021.

The CAA also creates various other incentives, like extending the increased deduction limit for corporate charitable cash contributions from 10% of taxable income to 25% of taxable income through 2021 and temporarily allowing taxpayers to deduct 100% of the cost of business-related food and/or beverages provided by restaurants in 2021 and 2022. The “provided by” language means this break is available for take-out and sit-down meals. The CAA also includes a provision regarding the H-2B visa program, which permits employers to temporarily hire nonimmigrants to perform non-agricultural labor or services in the United States. There are likely untapped opportunities for your manufacturing company to generate valuable saving if you only know where to look. Need help navigating the complexities of the CAA? It’s what our experts love to do. Contact our team today for a free consultation.

Sources: IRS, DOL, © 2020, Powered by Thomson Reuters Checkpoint

4 Cyber Security Safety Steps: Is Your Municipality at Risk?

4 Cyber Security Safety Steps: Is Your Municipality at Risk?

If you don’t have a cyber security plan in place, you can’t afford not to.

Local municipalities are under a growing threat from cybercriminals. Now more than ever before, residents need reliable, real-time access to information from public officials. While there is never a convenient time for a cyber-attack to take place, imagine how damaging a data breach would be if it impacted the ongoing COVID-19 response or vaccine rollout? Since 2017, cyber-attacks on local government rose by almost 50%, according to the “State and Local Government Security Report” released by cybersecurity firm BlueVoyant in August 2020. Because of the large amount of highly sensitive personal information that can be accessed including date of birth, social security number, next of kin, and current and previous addresses, (all of which can be used to steal a person’s identity) local and state government data is a prime target for malicious cyber-criminals. If you fall into the pool of local municipalities that are unprepared for an attack since transitioning some (or all) of your employees to telework, read on to save your team and your community from a huge financial and emotional headache.

Following the simple steps below can help you avoid:

  • Financial losses from theft of banking information
  • Financial losses from disruption of governmental operation
  • High costs to rid your network of threats
  • Damage to your reputation after telling public their information was compromised


Start with the basics of data safety.

Keeping your community safe requires your own computer systems to be protected. It may feel overwhelming to revise an existing plan, but it is crucial to protect your municipality. For starters, make sure all computers are equipped with antivirus and antispyware software, consider whitelisting programs and automate software updates. Use firewalls and spam filters as an additional line of defense. Keep your Wi-Fi network secure and hidden and create a wireless network for guests. The most secure way to offer visitors Wi-Fi access without allowing access to your municipality’s entire network is to create a subnetwork. Anti-malware solutions that combine signature-based detection and cloud-assisted technologies can also defend your devices against new, sophisticated threats.

Hackers can’t steal what you don’t have.

The more data you collect and store, the higher your cybersecurity liability. Residents are already entrusting you with a lot of highly sensitive, personal information. Don’t collect additional information you don’t need and only store information for as long as you have a legitimate need. It’s a best practice to also store data backups offline, as malicious software like ransomware becomes increasingly problematic for governmental institutions. In many cases, the victim must pay the cybercriminal within a set amount of time or risk losing access forever. And since malware attacks are often deployed by cyber thieves, paying the ransom doesn’t ensure access will be restored. Even when municipalities don’t pay, the costs can be staggering. For instance, the 2019 ransomware attack on Baltimore cost the City more than $18 million in damages and remediation.

Require unique passwords.

You’d be surprised by how many people still use “password” as the one and only defense against hackers. Remember, hackers have access to software that guesses passwords with common dictionary words. Consider implementing two-factor authentication procedures to offer an extra level of protection from hackers who may try to guess passwords. From the top leadership to the newest employee, cybersecurity requires the vigilance of everyone to keep data, residents, and capital safe and secure. Your employees should also have their own individual account/passwords automatically reset every 30 or 60 days.

Frequently, cyber security breaches stem from human error.

These mistakes are easily preventable through training. Your municipality should have cybersecurity procedures in place that clearly outline employee responsibilities as well as reporting procedures for lost or stolen devices that contain sensitive data. The Federal Communications Commission offers a cyberplanner to help organizations create a plan to protect their information. (You can generate a customized plan at the bottom of the page after you create it.) Educate and re-educate employees on current best practices so they understand the implications of a data breach, as well as the magnitudes for violating your security protocols.

Ultimately, the way your municipality prepares for and responds to a potential data breach can make or break your reputation. Protect your reputation and your community’s valuable information by preparing for the worst-case scenario and recruiting teams of experts to assist you. From IT, to PR, to financial preparedness, make sure you have your bases covered, and your team is informed. To consult a trusted RBT advisor, don’t hesitate to contact us today.