Originally posted 6/10/2021. Last updated 9/14/2022

The New York State COVID-19 Pandemic Small Business Recovery Grant Program is offering a grant between $5k – $50k to eligible small businesses. This includes 1099 workers / Schedule C as well.

Update 9/15/2022 – Two Separate Business Grants
This article is for a grant called “Recovery Grant”. There is a similar grant for NYS small businesses called “Seed Funding”.
Recovery Grant: For businesses that opened before 3/1/2019
Seed Funding: For businesses that opened after 9/1/2018
You are not eligible for Seed Funding if you already received funding from Recovery Grant. If your business started between 9/1/2018 and 3/1/2019, you can check which grant will give the higher grant amount. Recovery is 10% of 2019 income, max 50k. Seed Funding is 10% of 2020 or 2021 return, max 25k (or $5k if the business did not yet file a return).

Update 9/14/2022:
– Governor Hochul announced that as of 9/13 the requirement to have had a 25% reduction was removed! You are now eligible even if the business had no reduction from 2019 to 2020. This change makes many more businesses eligible.
Important: As of 9/14 this change is not yet reflected on the application website. We will update once clear guidance is published. However, if you are eligible, we suggest that you apply ASAP, and not wait for the guidance to be published, as funds are likely to run out quickly. The website was updated to reflect this change.
-The application Portal will close 9/30/2022 – your application and documents need to be uploaded by then.
– If you were previously declined based on not having a 25% reduction, your application should be automatically reactivated for processing.

Update 7/22/2022:
– The requirement to have had a net profit was removed! You are now eligible even if the business had no net profit in 2019 (or even if it had a loss). This change makes many more businesses eligible.

Update 8/25/2021:
– The maximum gross income allowed in order to be eligible was raised from $500,000 to $2,500,000.
– Maximum PPP business could have received raised from $100,000 to $250,000.
– (most likely only relevant to 1099/Schedule C individuals): Unemployment is counted as gross income.

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Table of Contents

• Grant Amount
• Business Eligibility
• How to Apply
• Using the Funds
• Taxes
• Further Guidance

Grant Amount

The grant amount is based on your 2019 gross receipts.

• Less than $25,000: No award
• $25,000 – $49,999.99: $5,000 
• $50,000 – $99,999.99: $10,000 
• $100,000 – $2,500,000: 10% of gross receipts – maximum grant is $50,000
• Over $2,500,000: $50,000 – only if 2020 gross receipts is less than $2,500,000. IF 2020 gross receipts is also more than $2.5 million, you are not eligible.

Where to find your “gross receipts”

• Corporations and Partnerships (1120, 1120S, and 1065): Line 1a 
• Sole Proprietorship (Schedule C): Line 1

Business Eligibility

ALL of the following are requirements. More details here.

1. For-profit business – non-profits are not eligible
2. Small business – 100 or fewer employees
3. Began operations by March 1 2019
4. Currently open (or closed due to Covid-19 restrictions)
5. 2019 or 2020 gross receipts between $25,000 and $2,500,000
6. 2020 gross receipts of less than $2,500,000 (Unclear now that a 25% reduction is no longer required, if 2020 income still needs to less than 2.5mm or not)
7. No longer a requirement (9/13/2022) Had a 25% reduction in gross receipts from 2019 to 2020
8. No longer a requirement (7/22/022) Made a profit in 2019 of at least $1
   • IRS Form 1120: Line 28
   • IRS Form 1120S: Line 21
   • IRS Form 1065: Line 22
   • Schedule C (1040): Line 31
9. Expenses for 2020 is more than the grant amount
   • IRS Form 1120: Line 27
   • IRS Form 1120S: Line 20
   • IRS Form 1065: Line 21
   • Schedule C (1040): Line 28
10. Did not receive more than $250k in PPP (total from both rounds of PPP)
11. Did not receive RRF (Restaurant Revitalization Grant Program)
12. Landlords/passive real estate businesses are not eligible 

How to Apply

The application process is being handled on behalf of NY by Lendistry.

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Application Process

1. Complete the online application
2. Register to make an account
3. Upload the required documentation

Documentation Required

1. Filed 2019 Business Tax Return (or Schedule C)
2. Filed 2020 Business Tax Return (or Schedule C)
3. Application Certification
4. IRS Form 4506-C – only if requested by Lendistry
5. Proof of Current Operation (two documents required)
6. ID for every 20%+ owner
7. If you have employees, then the most recent NYS-45 (payroll filing)
8. Completed W9 – this is sent via DocuSign if you are approved for the grant

Priority Applications

Priority will be given to socially and economically disadvantaged business owners including, but not limited to, minority and women-owned business enterprises (NYS certification not required), service-disabled veteran-owned businesses, and veteran-owned businesses, or businesses located in communities that were economically distressed prior to March 1, 2020, as determined by the most recent Census data.

Using the Funds

COVID-19 related losses or expenses incurred between March 1, 2020 and April 1, 2021.  

These include:

• Payroll costs
• Commercial rent or mortgage payments for NYS-based property (but not any rent or mortgage prepayments)
• Payment of local property or school taxes associated with a small business location in NYS
• Insurance costs
• Utility costs
• Costs of personal protection equipment (PPE) necessary to protect worker and consumer health and safety
• Heating, ventilation, and air conditioning (HVAC) costs
• Other machinery or equipment costs
• Supplies and materials necessary for compliance with COVID-19 health and safety protocols
• Other documented COVID-19 costs as approved by Empire State Development

Taxes

This grant is considered income and taxed on the federal level. It is not taxable for New York State taxes.

Further Guidance

• Program page with full details
• FAQ
• Application Guide (7/22/2022)
• Video
• Call Center: 877-721-0097 – Monday – Friday: 8:00 AM – 8:00 PM
• For help with the application process, reach out.