In Massachusetts, monthly state retail sales are up 16.3% in 2021 over last year’s retail numbers for Massachusetts.
An Economic Injury Disaster Loan (EIDL) is a low-interest loan that the United States Small Business Administration (SBA) can provide to eligible Massachusetts Retail Stores and MA Retailers of all sizes in designated areas after natural disasters.
What is NRF?
The National Retail Federation, the world’s largest retail trade association, passionately advocates for the people, brands, policies, and ideas that help retail thrive. From its headquarters in Washington D.C., NRF empowers the industry that powers the economy.
The National Retail Federation (NRF) engaged PwC to quantify the impact of the retail industry on the US economy.
Retail is the nation’s largest private-sector employer, contributing $3.9 trillion to annual GDP and supporting one in four U.S. jobs, 52 million working Americans. For over a century, NRF has been a voice for every retailer and every retail job, educating, inspiring, and communicating the powerful impact retail has on local communities and global economies.
What is an SBA EIDL Disaster Loan for Massachusetts Retailers?
It is a low-interest loan that the United SBA can provide to eligible Massachusetts Retail Stores and Retailers. Massachusetts Retail stores, retailers, small businesses, small agricultural cooperatives, and most private nonprofit organizations located in a declared disaster area and which have suffered a substantial economic injury may be eligible for an SBA Economic Injury Disaster Loan (EIDL).
In addition, EIDL funds may be used to meet any disaster-related need such as debris removal, emergency protective measures, repair / rebuilding expenses, or property replacement. Expenses not directly related to repairing damage from a disaster cause would not be considered “eligible” for this guidance.
If you have suffered a substantial economic injury and are one of the following types of businesses located in a declared disaster area in Massachusetts, you may be eligible for an SBA EIDL:
• Small business
• Small agricultural cooperative
• Most private nonprofit organizations
Eligibility for Massachusetts Retailers
• Substantial economic injury means the business is unable to meet its obligations and pay its ordinary and necessary operating expenses.
• EIDL provides the necessary working capital to help Massachusetts small businesses impacted by a disaster survive until normal operations resume.
• EIDL assistance is available only to small businesses when SBA determines they are unable to obtain credit elsewhere.
SBA can provide up to $2 million to help meet financial obligations and operating expenses that could have been met had the disaster not occurred. The loan amount will be based on your actual economic injury and your company’s financial needs, regardless of whether the business suffered any property damage.
A business may qualify for, both, an EIDL and a physical disaster loan.
The maximum combined loan amount is $2 million. A separate SBA Disaster Assistance program known as business physical disaster loans covers property damage.
Massachusetts Retailer Use of Proceeds
• Working capital and normal expenses such as the continuation of health care benefits, rent, utilities, and fixed debt payments
Terms for MA Retailers
• The interest rate will not exceed 4%.
• Up to 30 years, with repayment term to be determined by the ability to repay the loan
• No prepayment penalty or fees
Massachusetts Retail Store Collateral Requirements
• Required for loans over $25,000
• Real estate is the preferred collateral. Loans of $200,000 or less will not require the owner of the business to use their primary residence as collateral if it is determined the owner has other assets of equal quality and a value equal to or greater than the amount of the loan.
How to Apply for an EIDL Loan for Massachusetts Retailers?
• Apply online for an SBA disaster assistance loan. SBA will send an inspector to estimate the cost of damage, once your application is completed and submitted.
• Complete, sign and date IRS Form 4506-T with your application, giving permission for the IRS to provide SBA with your tax return information.
Contact the SBA Disaster Assistance Customer Service Center at:
Massachusetts Retail Industry State Impact Due to COVID
The US retail industry’s total employment impact, including its direct, indirect, and
induced impacts, supported 52 million full-time and part-time jobs, accounting for 25.8% of total US employment.
The industry’s total labor income impact was estimated to be $2.3 trillion or 18.7% of national labor income. The industry’s total GDP impact was $3.9 trillion, accounting for 18.7% of US GDP.
The US retail industry has undergone a number of changes in recent years, including the retirement of the baby boomer generation, the rise of the millennial generation, and the continued expansion of online sales.
The economic impact of the retail industry reaches all 50 states and the District of Columbia. The total number of retail establishments ranged from 9,557 (Wyoming) to 504,674 (California).
The top 15 states in terms of the total number of retail establishments were California, Texas, Florida, New York, Pennsylvania, Illinois, Ohio, Georgia, North Carolina, Michigan, New Jersey, Virginia, Tennessee, Massachusetts, and Washington. Combined these states accounted for 66% of the total retail establishments in the country.
Massachusetts COVID-19 EIDL Loans for Retailers
This federal small business loan program supports retail stores and retailers’ recovery from the COVID-19 disaster’s economic impacts by providing accessible and borrower-friendly capital.
MA Retail Loan Details
In response to COVID-19, small business owners, including agricultural businesses, and nonprofit organizations in all U.S. states, Washington D.C., and territories can apply for the COVID-19 Economic Injury Disaster Loan (EIDL).
• FAQ regarding COVID-19 EIDL
Loan directly from SBA that must be repaid; low-interest, fixed-rate, long-term loan to help overcome the effects of the pandemic by providing working capital to meet operating expenses
Use of Proceeds:
Working capital to make regular payments for operating expenses, including payroll, rent/mortgage, utilities, and other ordinary business expenses, and to pay the business debt incurred at any time (past, present, or future)
Massachusetts Maximum Loan Amount:
$2 million. Note: SBA will begin approving loans greater than $500,000 on October 8, 2021.
Businesses: 3.75% fixed and Private nonprofit organizations: 2.75%
Payments are deferred for the first 2 years (during which interest will accrue), and payments of principal and interest are made over the remaining 28 years. No penalty for prepayment.
Fees – For Loans $25,000 or Less:
No fees if applying directly through SBA
For Loans Greater than $25,000:
One-time $100 fee for filing a lien on borrower’s business assets plus costs to file a lien on real estate when applicable.
For Loans Greater than $500,000 where SBA is Taking Real Estate as Collateral:
One-time $100 fee for filing a lien on borrower’s business assets. Additionally, the borrower will be responsible for recording the real estate lien and paying the associated fees.
Required for loans greater than $25,000
Required for loans greater than $200,000
Apply for a Loan:
Complete your online COVID EIDL application.
Apply for an Increase:
Complete your request for an increase in your COVID EIDL portal.
Massachusetts Program Updates for EIDL Loan for Retail Stores and Retailers
As of September 8, 2021, new COVID EIDL policy changes have taken effect that entails the below updates to the program:
• The maximum loan cap increased from $500,000 to $2 million
• Use of funds was expanded to include payment and pre-payment of business non-federal debt incurred at any time (past or future) and payment of federal debt
• Extend the deferment period to 24 months from origination for all loans (existing loans with a less than 24-month deferment will be adjusted)
• Affiliation requirements simplified to an affiliate is a business that you control or in which you have 50% or more ownership
• Developed additional path to meet program size standards for businesses assigned a NAICS code beginning with 61, 71, 72, 213, 3121, 315, 448, 451, 481, 485, 487, 511, 512, 515, 532, or 812
• Exclusivity Period: From September 8, 2021, to October 8, 2021, the above policy changes will be applicable to applications for <$500K while applications for >$500K will not be approved and therefore receive the policy changes until October 8, 2021
• See more details on the COVID-19 September 8, 2021, Policy Changes.
Massachusetts SBA Application Process for EIDL Loans for Retail Stores and Retailers
If the small business is a first-time COVID EIDL applicant, complete the following steps to apply:
- Confirm eligibility (review FAQs and below Loan Eligibility section).
- Complete Intake Form.
- Sign up to create a portal username via an SBA email invite.
- Complete portal steps and submit relevant documents.
- Respond to SBA requests for signature, confirmation, and documents.
The average SBA decision timeline for $500,000 or under is several weeks.
If the small business has already obtained a loan via COVID EIDL before and does not already have an outstanding loan increase application in process, complete the following steps to apply for a loan increase:
- Confirm Eligibility (review FAQs and below Loan Eligibility section).
- Log onto Account on SBA Portal (do not apply for another loan) to submit loan modification.
- Complete portal steps and submit relevant documents.
- Respond to SBA requests for signature, confirmation, and documents.
The average SBA decision timeline for $500,000 or under loans is several weeks.
Massachusetts Loans from $500k to $2 Million
• For loans above $500k, you must include all additional documents for your application to be submitted (see list of required documents below).
• For loans greater than $500,000, applications will not be approved until after the exclusivity period ends on October 8, 2021, but applications can be submitted before then. Applicants can choose to apply for $500,000 or under immediately and then for over $500,000 funds after the exclusivity period ends, or they can choose to apply immediately for all desired funds above $500,000 and have their application wait for approval starting October 8, 2021.
The average SBA decision timeline for greater than $500,000 loans is one and a half months.
• For loans of all sizes, federal income taxes, IRS Form 4506-T, and ODA Form P-022-Standard Resolution are required.
• For loans greater than $500,000, the following additional documents will be solicited:
– SBA Form 2202 – Schedule of Liabilities
– SBA Form 413 – Personal Financial Statement
– List of Real Estate Owned (template on intake form)
• For all loans, additional verification documentation may be solicited by the SBA through the review process
Massachusetts Loan Eligibility
To obtain a loan via COVID EIDL, small business owners must meet the eligibility requirements outlined in Section 2 of the FAQS.
Additionally, below are the credit score requirements:
• $500,000 or under: 570
• Greater than $500,000: 625
Small businesses must qualify for a certain loan amount by completing the economic injury formula which takes into account two years’ worth of revenue and the cost of goods sold to produce an eligible loan amount. Review Section 2 of the FAQS and the Intake application form checklist for more details.
IRS Tax Authorization Form 4506-T for Massachusetts Retail Stores and MA Retailers
Retail Stores and Retailers Applicants are required to submit a signed and dated Form 4506-T authorizing the IRS to release business tax transcripts for SBA to verify their revenue.
If you have previously submitted a Form 4506-T for an SBA loan or grant, you are still required to submit a new version for your COVID EIDL loan or loan increase.
Form 4506-T is only valid for 120 days. If the form in your file is nearing expiration, your loan officer may request a new one.
To avoid problems, please review these tips for preparing your IRS Tax Authorization Form 4506-T.
The IRS offers a tax credit for Massachusetts employers with retail employees on payroll at your MA locations.
Massachusetts Retailer and Retail Store Conclusion and Summary
An Economic Injury Disaster Loan (EIDL) is a low-interest loan that the SBA can provide to eligible Retail Stores and Retailers of all sizes in designated areas after natural disasters approved by NRF (National Retail Federation).
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Small Business Help: Get Loan Assistance for Your Business
Was Your Massachusetts Retail Store SBA EIDL Loan Denied?
Has your SBA EIDL loan been denied for your store location?
We can assist you in filing for an SBA EIDL loan reconsideration appeal for your business.
Schedule Your Free Disaster Loan Consultation to see if we may be able to help your retail store locations or online retail business with the SBA Loan Reconsideration Process in Massachusetts.
Need an Increase on Your Massachusetts Retail Store SBA EIDL Loan?
Did you already receive a Massachusetts SBA EIDL loan for your retail business?
We can assist your business in requesting additional SBA EIDL loan funds through the increase request process.
Schedule Your Free Disaster Loan Consultation to see if we may be able to help your retail business with the SBA Increase Request Process in Massachusetts.
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