The latest COVID relief bill includes help specifically for restaurants and similar businesses. If you are an owner of a small business in the foodservice industry, you may be eligible to receive benefits through this fund. In this post, we will answer some of the biggest questions people have about the Restaurant Revitalization Fund (RRF).
What is the Restaurant Revitalization Fund?
The Restaurant Revitalization Fund is an initiative of the U.S. government Office of Small Business Administration (SBA) to provide relief for small businesses in the foodservice industry. The fund was created in order to help reimburse businesses for lost revenue as a result of forced closures and restrictions during the COVID-19 pandemic.
The benefits from this fund will be in the form of direct payments and are capped at up to $10 million per business and $5 million per location. These payments are not taxed, which means no part of them will need to be paid back in the future.
Of the $28.6 billion available through the fund, the SBA has set aside different amounts of money for specific businesses based on their gross receipts.
- $5 billion for applicants with 2019 gross receipts under $500,000
- $4 billion for applicants with 2019 gross receipts between $500,000 and $1.5 million
- $500 million for applicants with 2019 gross receipts less than $50,000
How Do I Apply for a Restaurant Stimulus?
You can apply for your RRF grant directly with the Small Business Administration (SBA) on their website or with any of their participating vendors, such as Square, Toast, Clover, NCR Corporation (Aloha), and Oracle. You will also need to be prepared to submit several documents:
- IRS Form 4506-T
- Gross receipts (IRS Forms 1040 Schedule C, IRS Form 1120, bank statements, point of sales reports, etc.)
- Eligible expenses
Some supplemental documents will also need to be provided if you are the owner of an inn or of a bar, wine room, distillery, or any other location that specifically sells alcohol.
Who is Eligible for the RRF?
Several categories of businesses may qualify for funding from the RRF. These include restaurants, cafeterias, food stands, food trucks, caterers, bars, wineries, bakeries, snack bars, breweries, and inns. There are two main requirements that a business must meet in order to qualify for the benefits under the RRF.
- Have food and beverage sales make up at least 33% of your gross receipts for 2019 (or projected for 2020 if you’re a new business).
- Have no more than 20 locations.
When Will the Restaurant Revitalization Fund be Available?
The RRF has been available since May 11, 2021, and will continue to provide funding until the fund is depleted. Starting on the 11th, SBA will accept applications from anyone who qualifies. For the first 21 days, the funds will only be distributed to businesses that are classified as priority candidates. These priority groups include businesses that are at least 51% owned by a woman, veteran, or socially or economically disadvantaged individual.
Starting on the 22nd day, SBA will process applications in the order in which they are approved. That means that even if you don’t qualify as a priority group, it would still be smart to get your application in as soon as possible.
Schedule A Free Consultation to Go Over Your RRF Application
The RRF application can be complicated, and you want to ensure that you properly calculate the loan amount that will cover all of your losses and provide some relief to yourself and your employees. At ASCEND Business Advisory, we work with you to make sure your RRF application process is smooth sailing. Schedule a free consultation with us today to talk about your application for the Restaurant Revitalization Fund before it runs out! Call Us at 888 297-3321.