National Restaurant Association offers 39 questions and answers on program that could be lifeline for many

EDISON, NJ (TIP): The coverage period for the Restaurant Revitalization Grant Fund may be extended by 14 months (until March 2023) … the definitions of bakeries, breweries and inns may change, based on percentage of onsite sales … the gross receipts total for 2020 may no longer include Paycheck Protection Program loans and other debt relief awards, says a news report published April 9 in RIONJ.Com

Applications for the $28.6 billion Restaurant Revitalization Grant Fund are still expected later this month. But, before they come out, the National Restaurant Association released a list of 39 answers to the most frequently asked questions the group has received since the program was introduced. “Eligible entity” definition may have new context for bakeries, breweries, brewpubs, distilleries, taprooms and wineries, only if onsite sales to the public comprise at least 33% of gross receipts (presumably in 2019). For inns, onsite sales of food and beverage to the public may need to comprise at least 33% of gross receipts.

Permanently closed entities might be ineligible.

Bankrupt entities without approved plans for reorganization might be ineligible.

The minimum grant award might be set at $1,000.

Some of the items with additional clarification include:

For gross receipt totals in 2020, applicants might not need to include PPP loans, SBA debt relief, COVID-19-related Economic Injury Disaster Loans, EIDL advances, targeted EIDL advances or any other state and local small business grants (via CARES Act or otherwise). This was a recommendation from the National Restaurant Association to SBA. PPP first-draw loans, returned before the safe harbor deadline, might not be counted against grant fund amount. This was also a recommendation to SBA from the National Restaurant Association. Self-certification for prioritization eligibility is the likely path for targeted groups and differs from SBA certification for traditional loan programs. The FAQ also provides specific details about the documents that might be required for application:

Application form.

IRS Form 4506-T.

Acceptable documentation of gross receipts and, if applicable, eligible expenses, might include:

Business tax returns (IRS Form 1120 or IRS 1120-S).

IRS Forms 1040 Schedule C; IRS Forms 1040 Schedule F.

For a partnership: partnership’s IRS Form 1065 (including K-1s).

Bank statements.

Externally or internally prepared financial statements such as income statements or profit and loss statements.

Point of sale report(s), including IRS Form 1099-K.

Sean Kennedy, executive vice president of public affairs for the National Restaurant Association, said the group is determined to provide this much-needed information.

Good news for restaurants seeking Revitalization Fund grants

“These updates are essential for the small business restaurants that are trying to prepare their application while working long hours to keep their doors open,” he said. “For that reason, the association and our state partners are committed to getting these details to operators as we learn them.

“We appreciate the speed at which the SBA is working to set up this program, and we are doing everything we can to make sure that it will work well for the restaurants that have been hoping for this relief over the last 12 months.”

How much money is available?

Grants will be equal to 2019 gross revenue minus 2020 gross revenue — with a maximum grant of $5 million ($10 million for restaurant groups).

Will it be taxed? Grant funds will not be taxed like income.

What can it be used for?A variety of uses, including:

Payroll costs.

Principal and interest payments on a mortgage.

Rent payments.

Utilities.

Maintenance expenses.

Supplies, including personal protective equipment and cleaning materials.

Covered supplier costs.

Operational expenses.

Paid sick leave.

(Source: ROI.NJ. Com)