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2020 CARES Act for Restaurants

What is the CARES Act?

The Coronavirus Aid, Relief, and Economic Security (CARES) Act has been signed into law and is intended to provide approximately two trillion dollars in relief to individuals and businesses during this difficult time. Restaurant workers and owners will be able to benefit from two of the six main groups that the CARES Act is aimed to help – individuals and small businesses.

Navigating Financial Recovery for Restaurants

Watch video below on our webinar with Gusto. We discuss what it will take for restaurants and small businesses to recover from dining bans and lockdowns, and what financial tools are at your disposal to weather this economic downturn.

Webinar Slides:

How the CARES Act Will Help Support Restaurants and Owners

Any business with less than 500 employees will be eligible for emergency grants and forgivable loans. There will also be updates and changes made to the rules for expenses and deductions as a way to help employers keep staff on payroll.

What is the difference between emergency grants and forgivable loans?

Ten billion dollars from the CARES Act will be allocated toward emergency grants which are intended to cover operating costs. The maximum amount for grants is $10,000 per business.

An additional $350 billion in forgivable loans will be distributed through the Small Business Administration (SBA) and provide up to $10 million or two and a half months’ worth of payroll (whichever is less) per business. This money can be used to cover payroll, rent, mortgages, and more and will be forgiven provided that a certain number of employees stay on the books through June.

Can I get relief for any existing loans through the CARES Act?

The CARES Act has $17 billion that will be dedicated to cover up to six months of payments for any current loans through the SBA.

Watch: Robert F. Smith, CEO of Vista Equity Partners, breaking down how restaurant owners and small businesses can navigate the PPP and CARES Act relief and leverage free online ordering from Upserve to stay in business.

Check out Quick Base’s COVID-19 Small Business Relief Programs for assistance with applying for your CARES Act SBA loans.

How the CARES Act Will Help Support Restaurant Staff

For individuals, the CARE Act will help by expanding unemployment benefits and sending cash payments to those who meet certain requirements. Additionally, there will be new rules for things like filing taxes, health coverage, and more.

Will I receive cash payments from the CARES Act?

A one-time cash payment of $1,200 will be sent to anyone making less than $75,000 a year. The payment amounts will decrease for people making between $75,001-99,000. Anyone making above $99,000 will not receive a payment. An additional payment of up to $500 per child will also be made for those who fit the criteria.

Will I receive additional unemployment benefits from the CARES Act?

The amount of money someone receives from their state will remain the same, but the CARES Act will provide an additional $600 per week in federal contributions for the next four months, or until they can return to work.

The bill will also provide 13 more weeks of unemployment insurance, so if you are getting close to the maximum number of weeks allowed by your state, you can receive an extension. If you file for unemployment now, you will still be eligible to collect for the amount of time allowed by your state, plus the additional 13 weeks.

Will I still receive the tax return I was expecting?

The IRS has said that anyone who has filed or plans to file their taxes and receive a return will still be getting the same amount as before. The tax deadline has also been extended from April 15 to July 15.

Will the CARES Act help me with health coverage?

If you are already on a private insurance plan, the CARES Act will require your provider to cover all COVID-19 treatments and make all coronavirus tests free. If you are currently uninsured, check with your state about signing up for insurance under the Affordable Care Act – 11 states have reopened enrollment so far.

For more financial resources, news, and updates on how the coronavirus is affecting restaurants, visit our COVID-19 resources page.

Other Ways Can the CARES Act Help Restaurant Owners and Employees

In addition to individuals and small businesses, the CARES Act provides relief to four other areas: public health, big business, education, and state and local governments, plus a federal safety net. Below are some ways those in the restaurant industry may be able to benefit from some of those other areas.

Public health

  • $1.32 billion in immediate funding will be provided to community health centers, where roughly 28 million people (many without insurance or with poor coverage) rely on for care.
  • If you are a veteran, an additional $20 billion is set aside to help fund VA hospitals and veteran care.
  • Telehealth programs will be extended to provide virtual doctor’s visits to those who cannot get to an office or prefer not to visit a medical center.


  • All federal student loan borrowers will have zero interest added through September 30 and payments may be deferred.
  • If you are a current student who has had to drop out due to the Coronavirus, this time away will not be deducted from your lifetime limit on subsidized loan and Pell grant eligibility. You will also no be responsible for paying back any grants or other aid you’ve received up until now.

Federal Safety Net

  • For those with children in need of food, an additional $8.8 billion will be given to schools to help provide meals to students.
  • The government is allocating an additional $15.5 billion to SNAP, the Supplemental Nutrition Assistance Program, in preparation for an influx of applicants.
  • American Indian reservations, Puerto Rico, Northern Mariana Islands, and American Samoa will all receive additional funds for federal nutrition programs.
  • Food banks and other community food distribution programs will receive $450 million more in funding.

Creation of the Paycheck Protection Program (PPP) 

The PPP provides loans through the SBA that have the ability to be forgiven completely forgiven.

  • The National Restaurant Association (NRA) secured a special carveout that maximizes the number of restaurants that are eligible for these loans, allowing restaurant groups and independent restaurants with larger employee counts to participate.
  • The NRA has pushed Congress to waive many of the rules and tests for SBA loan applications that have slowed down the process for restaurants in the past.

Delay of Payment of Employer Payroll Taxes

Businesses can defer their share of social security taxes and opt to pay half by December 2021 and the other half by December 2022.

Employee Retention Tax Credit 

This provides restaurants with a refundable payroll tax credit for 50% of wages paid during the COVID-19 crisis.

Fixing the Qualified Improvement Property (QIP) Tax Glitch

After many years, Congress is finally going to fix this error. Restaurants can now permanently depreciate certain renovations over 15 years, rather than 39. Restaurant owners may fully and immediately deduct these expenses for 2018-2022.

Pizza chef and business owner

Restaurant Advocates Lobbying for Help Beyond the CARES Act

There are industry advocates who are currently working with the federal government to help restaurant owners who have had to close or have lost business and are being denied by their insurance companies under “act of God” clauses.

“If this is not an ‘act of God’ that stops a restaurant’s operation, I don’t know what is,” said Sean Kennedy, executive vice president at the NRA. “It’s a very dire situation.” Kennedy called the CARES Act “a tremendous first step towards allowing restaurants to keep their lights on a little longer. But for the long term needs of this industry, we are going to need more out of Congress.”

According to mcclatchydc.com, 3% of restaurants nationwide have already had to completely close their doors, and an additional 11% are expected to close within the next 30 days. The urgency of this situation is pushing restaurant industry executives and advocates to work with Congress and the President to help these businesses that are being denied by their insurance companies. While businesses could now take legal action against insurance companies, industry leaders would prefer the government to protect small businesses with intervention from the White House or congressional legislation.


The NRA is constantly monitoring this bill and how it pertains to restaurants and their staff. Click here to sign up for email updates from the NRA.

Written by   |  
Stephanie is a Providence, RI native and eight-year food industry veteran. As Upserve's Content Marketing Coordinator she creates materials that help restaurateurs, managers, and service professionals succeed. When she's not writing, Stephanie is most likely traveling, cooking, or trying new restaurants.
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