Types of Government Funding
Everyone, from low-income individuals to thriving businesses, can do with additional money at some point. Short of finding new ways to earn money, those in need can often turn to the government for funding. Government funding is available in several forms and fulfills a wide range of purposes. But it's difficult to take advantage of government funding without first knowing where to look.
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Grants
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Government grants are among the most desirable and useful types of government funding. Many federal organizations offer grants including scientific, education, social and art organizations. The federal government lists its extensive grant offerings on the grants.gov website, which also includes information for applicants. Government grants require applicants to state their case for receiving federal funds and competition is very strong, especially for grants in under-funded fields. But grants never require repayment, and those who receive them can invest the funds directly into their work without making plans for repayment in the future.
Loans
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Government loans are another major source of government funding. They require repayment based on an agreed-upon payment plan, which often features lower interest rates and more reasonable loan terms than similar loans from commercial lenders. The U.S. Department of Education offers loans for college students while the Small Business Administration provides loans that you can use to get your small business idea off the ground. However, competition for some government loans is strong.
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Tax Rebates and Credits
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The government can also fund specific endeavors through changes to the tax code or tax rebates. By issuing a rebate, the government delivers a cash payment to certain taxpayers, usually as a means of funding economic growth. Rebates typically depend on income levels and tax filing status to determine who receives a payment, and in what amount. Tax credits, which allow taxpayers to reduce the amount of tax they owe, apply to many different behaviors such as buying a fuel-efficient car, installing energy-efficient fixtures in a home and paying for child care. These credits fund the businesses that supply the products and services they apply to indirectly.
Business Funding
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The federal government also provides funding for businesses. In particular, small businesses can take advantage of special government grants and low-interest loans that the government offers to keep businesses sustainable and promote growth in certain areas. For example, the government may offer tax credits to businesses that add jobs as a means of battling unemployment. The government can also fund energy-efficient manufacturing by offering grants and loans to businesses that want to upgrade their facilities.
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