COVID-19 is a fast-moving virus and a fast-moving news story. The pandemic will likely affect us all, but small-business owners in the service industry are the first to feel the pressure of the looming financial crisis.

Among my clients are individual dog trainers and behaviorists going to clients’ homes, training facilities holding several group classes a day, and dog walking companies with a dozen employees. In-person group classes have been cancelled, dog walkers are not needed by commuters who are no longer commuting, and behavior consultants aren’t sure whether it’s safe to go from client to client.

Like you, they are all trying to figure out where the next paycheck will come from.

So, what should you do? Start by taking a deep breath and clearing your mind. As a business owner, it is important to review the situation with a keen eye and make decisions that will serve you, your business (and your employees) in the near term and in the long run.

Take stock

The first step is put aside some time to review your business. Take stock of your income and expenses:

• What services have you been offering?
• What income have those services been bringing in?
• Which of those services can you continue, and to what extent?
• What are your business expenses?
• Which of those expenses can you reduce or cut?
• What is the shortfall?
• What other services can you offer to service your existing clients?
• What new services could you offer to solve your potential customers’ new needs (e.g., people working from home need quiet time without a dog around)?

Get help to cover the gap

It may well be that despite your best efforts to cut expenses and fill the income gap, the gap is insurmountable and you need to find some other way to cover your business or household expenses.

The federal government has passed two emergency aid packages that will benefit both businesses and workers, and is working on a third package totaling up to $1 trillion. These bills propose several measures aimed at providing individuals and businesses with some financial relief:

1. Direct payments to tax payers

The administration is seeking to pass a stimulus package that includes direct payments to taxpayers as soon as April and May of 2020. There are several proposals about how to calculate how much will be provided to each person, but there seems to be general agreement on that approach.

2. Low-interest loans guaranteed by the SBA

If you’re seeing a drop in sales, and you don’t have enough funds to cover business expenses like employee wages, rent, or other bills, the Small Business Administration (SBA) is making loans available known as Economic Injury Disaster Loans. The Economic Injury Disaster Loans provide relief for qualifying businesses in the form of low interest rates and long-term repayment plans. If you have credit elsewhere you may not be eligible for these low interest loans, but for those who qualify they could provide the bridge needed to span this pandemic.

In addition, regulators are encouraging financial institutions to work with borrowers and other customers in affected communities, and additional aid in the form of grants or loans for struggling businesses may be included in the next stimulus package coming within the week.

3. Benefits for your employees

If you have employees, you are likely concerned about whether you can pay them if there is not enough work, or if they get ill or must stay home to take care of family members. The stimulus bills provide for paid sick leave to impacted and eligible employees for 14 days, at their regular rate of pay, in addition to any paid sick leave they already offer employees. To offset these paid time off costs the House also passed a business tax credit, equal to the amount of the benefits paid to employees. Business tax credits directly lower a business’s tax liability, dollar-for-dollar.

If you do need to lay off employees, unemployment benefits will also be extended, and the requirements to qualify are being relaxed. Don’t assume unemployment is not available; whether you are self-employed, or your employee’s wages are cut but not completely laid off, check your state’s rules and keep checking, because things are changing.

4. Federal income tax deferment

Another form of financial relief for businesses and individuals comes in the form of a federal income tax deferment proposal. The tax return deadline of April 15 has been deferred for businesses negatively impacted by the coronavirus—without penalties. This gives business owners the opportunity to use their tax liability to cover other expenses. You would not owe penalties on your taxes if you took advantage of the federal income tax deferment. Some cities and states are putting similar tax extensions into motion.

Conclusion

While loans and delayed taxes may seem like small consolation when your business has been shuttered, if you can streamline your business and adapt to the changed environment, some assistance may be out there to help you weather this storm.