Tuesday, April 7, 2020

CARES Act: Where music industry workers can find federal aid amid coronavirus

Written by Matthew Leimkuehler - A $2.2 trillion stimulus package offers multiple financial lifeboats to music industry and entertainment professionals drowning in the impact of COVID-19. 

Live music, film and theater industries — respectively fueled by gig workers and freelancers — were among the first impacted by coronavirus shutdowns in March. 

Self-employed music industry professionals — sound engineers, touring crew members, songwriters, working musicians and more — qualify for aid under the unprecedented federal assistance, per the Nashville Songwriters Association International, a leading not-for-profit trade organization. 

The package offers an estimated $349 billion in grant and loan programs for three categories of qualifying professionals who earn less than $100,000 annually: sole proprietors, independent contractors and the self-employed. In the package, these individuals can seek federal aid via a paycheck protection program and emergency economic injury disaster loan, among other options. 

Leading industry organizations, including Nashville-based NSAI, Country Music Association, Americana Music Association and Gospel Music Association, launched earlier this week a website to help industry workers navigate aid options.

Paycheck Protection Program

Starting last Friday, sole proprietors and small-business owners can apply for paycheck protection through a program overseen by the Small Business Administration. Businesses with 500 employees or fewer can apply. 

Banks administering the loans include Bank of America, First Horizon, Pinnacle Bank, Regions Bank and SunTrust Bank, per NSAI.   

For small businesses, “it is anticipated that not more than 25% of the forgiven amount may be for non-payroll costs,” a federal tip sheet said. Loans can cover up to two months’ average monthly payroll, plus an additional 25% of that total, for a maximum $10 million. 

How much can be forgiven? That depends.

“You will owe money when your loan is due if you use the loan amount for anything other than payroll costs, mortgage interest, rent and utilities payments over the 8 weeks after getting the loan,” per federal guidelines. 

Individuals and businesses can request loan forgiveness with each provider. Loans include a 10-year term capped at 4% interest and payments will be deferred at least six months.

Independent contractors and self-employed workers who make less than $100,000 annually can begin applying Friday. 

Businesses and workers can apply only once and are encouraged to apply as soon as possible. The application window closes June 30.  

Economic Injury Disaster Loan

Independent contractors, sole proprietors and small businesses — those with 500 employees or fewer — can apply for the federally administered Economic Injury Disaster Loan Program.

Qualified applicants receive a forgivable $10,000 within three days of approval. A maximum $2 million can be borrowed; the loan offers a 3.75% interest rate for small businesses and 2.75% for nonprofit organizations. 

The loan offers a maximum 30-year repayment period. 

Potential borrows can apply for EIDL now. 

Stimulus check

Most Americans, self-employed or otherwise, qualify for a stimulus check. Those making under $75,000 or less annually qualify for $1,200, with workers making $75,000 to $99,000 receiving a lesser amount. Couples earning a household annual income of less than $198,000 qualify for stimulus funds. 


The CARES Act opens unemployment benefits for those who don’t typically qualify, including self-employed and independent contractors per NSAI. 

Under the stimulus package, gig workers and the self-employed can receive half the average unemployment benefit, which varies by state, plus an extra $600 weekly.   

The maximum unemployment benefit in Tennessee is $275 weekly before taxes. 

Those eligible could qualify for up to 10 months’ benefits, plus an additional 13 weeks, but the Tennessee Department of Labor and Workforce has yet to launch an online portal for qualifying self-employed workers.

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