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Paycheck Protection Program

Old 03-30-2020, 11:31 AM
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Originally Posted by David2 View Post
Hang on here. You will not be applying or getting money from the SBA. This is a completely different program than the usual SBA loan process and all will be done at your bank.

You are correct, but they are going to only require those forms that I stated for up to 50k to streamline the process.
Old 03-30-2020, 11:36 AM
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Originally Posted by reeltateredfishin View Post
You can still apply directly yourself as of today without waiting for bank. It allows you to put in you bank routing and acct# to receive 10k within three days. You can also wait until you bank gets approval but that will more than likely be mid April and who knows how much $$ will be left according to my commercial banker. I was advised by my CPA,Lawyer and banker to file directly asap. So that is what I did.
What you are talking about is SBA’s Economic Injury Disaster Loan Program which has always been a thing and is much different than the new Paycheck Protection Program which we are talking about here. One of the links in the OP spells out the differences between the two. Mainly there is NO forgiveness option for the Disaster Loan Program. It's just a straight up loan.
Old 03-30-2020, 11:47 AM
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I run a small family S-Corp. Figuring out my burn rate to see how long I can pay my adult son and nephew while we are not working and if there are any options under this plan for my type of business. Probably need to wait till there are further details which puts me behind the curve.
Old 03-30-2020, 11:50 AM
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So, let me get this straight.
I am a small manufacturer in an essential sector. If I stay open but business is down to the point of considering lay offs, but I don't and keep everybody, I can qualify for a lone (to be forgiven) to cover payroll, rent, etc?
Old 03-30-2020, 11:53 AM
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https://docisolation.prod.fire.glass...7-ef2078b8aa02

Old 03-30-2020, 12:18 PM
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Originally Posted by MAXIMUM B View Post
So, let me get this straight.
I am a small manufacturer in an essential sector. If I stay open but business is down to the point of considering lay offs, but I don't and keep everybody, I can qualify for a lone (to be forgiven) to cover payroll, rent, etc?

Yes, but the amount to be forgiven will be reduced if you reduce your payroll during the 8 weeks following the loan (so you have to continue to pay them even if they aren't needed). It is also capped for people that make over 100K per year.
Old 03-30-2020, 12:25 PM
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Originally Posted by MAXIMUM B View Post
So, let me get this straight.
I am a small manufacturer in an essential sector. If I stay open but business is down to the point of considering lay offs, but I don't and keep everybody, I can qualify for a lone (to be forgiven) to cover payroll, rent, etc?
Yes from what I understand but the forgiveness amount is adjusted for those you laid off. I think it's important to remember that the goal of this thing is to keep you temporally afloat instead of say a bail out for a failing business. We have 13 employees that we plan on keeping on as best as possible. While business has slowed we are still getting some new orders but things like wages, rent, utilities, insurance, etc. are still fixed costs no matter your incoming case flow.
Old 03-30-2020, 12:28 PM
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Originally Posted by SLT Kota View Post
Yes, but the amount to be forgiven will be reduced if you reduce your payroll during the 8 weeks following the loan (so you have to continue to pay them even if they aren't needed). It is also capped for people that make over 100K per year.
That part sucks as we put the owners on payroll but mostly just to cover taxes and health insurance. The question I'm asking of our accountant is if we can reduce our 'pay' to under 100K for this year to qualify or if they just look back to last year which was reported on the W2 as 103K
Old 03-30-2020, 12:37 PM
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Originally Posted by BackEastDon View Post
I run a small family S-Corp. Figuring out my burn rate to see how long I can pay my adult son and nephew while we are not working and if there are any options under this plan for my type of business. Probably need to wait till there are further details which puts me behind the curve.
This is the issue, with the delay in getting this passed and the typical slow govt work when will we see this. One of my colleagues today decided to shut down and furlough until May 1st(NC) and try to start operating from there with this loan. So his folks will draw unemployment until then.
That might be a better option than "burning" through the accounts.
Old 03-30-2020, 12:40 PM
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Originally Posted by 2020is View Post
This is the issue, with the delay in getting this passed and the typical slow govt work when will we see this. One of my colleagues today decided to shut down and furlough until May 1st(NC) and try to start operating from there with this loan. So his folks will draw unemployment until then.
That might be a better option than "burning" through the accounts.
Have him check with his accountant because I thought I read somewhere that there was a provision of qualifying if you bring back laid off workers. This was not relevant to me so I didn't pay very close attention so FYI.....
Old 03-30-2020, 12:42 PM
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From our banker: I just received an email that the District office in Detroit is waiting on final guidance. In the mean-time, please assemble the following:
  • 2019 federal tax return (if not complete prepare a year end P&L and an interim P&L.
  • Look at your payroll, healthcare, insurance premiums, sick pay rent, utilities and interest only portion of the term debt over the past 12 months or calendar 2019. The eligible amount will be roughly 2.5x the monthly payroll et. Al. expenses. No employees making greater than $100K can be eligible for the that amount equal to or over $100,000.
Old 03-30-2020, 12:46 PM
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Originally Posted by David2 View Post
Have him check with his accountant because I thought I read somewhere that there was a provision of qualifying if you bring back laid off workers. This was not relevant to me so I didn't pay very close attention so FYI.....
I think he has the right thought if he can get the timing right. Only my thinking is that if he applies and gets that money sooner than 5/1 he will need to bring those people back ideally starting the date he receives/signs the loan which will start his 8 weeks from that point.
Old 03-30-2020, 12:56 PM
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Originally Posted by 2020is View Post
I think he has the right thought if he can get the timing right. Only my thinking is that if he applies and gets that money sooner than 5/1 he will need to bring those people back ideally starting the date he receives/signs the loan which will start his 8 weeks from that point.
Honestly I just don't know. But I would still have him check with a expert so he doesn't get burned.
Old 03-30-2020, 01:00 PM
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Has anyone applied for the PPP yet? My understanding is that is not open yet??

Old 03-30-2020, 01:02 PM
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Originally Posted by David2 View Post
That part sucks as we put the owners on payroll but mostly just to cover taxes and health insurance. The question I'm asking of our accountant is if we can reduce our 'pay' to under 100K for this year to qualify or if they just look back to last year which was reported on the W2 as 103K
There seems to either be a misunderstanding on this part or poor wording. The consensus from what I read is capped at $100k so just don't go over that for this period of time and the fact that last year was $103k won't matter. Some wording has not eligible for workers over $100k but I think "capped" is the appropriate word for this.
Old 03-30-2020, 01:04 PM
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Originally Posted by GWcpa View Post
Has anyone applied for the PPP yet? My understanding is that is not open yet??
A bank reached out to a client of mine and attached an application. I completed the application this morning, BUT just got an e-mail that it was the wrong application and they would get back with us. So, no, I don't think it's open. Looks like his bank jumped the gun. I will let you know if I find out something concrete. You do as well please.
Old 03-30-2020, 01:04 PM
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Originally Posted by 2020is View Post
There seems to either be a misunderstanding on this part or poor wording. The consensus from what I read is capped at $100k so just don't go over that for this period of time and the fact that last year was $103k won't matter. Some wording has not eligible for workers over $100k but I think "capped" is the appropriate word for this.
would think so otherwise they are saying pay everybody else except yourself.
Old 03-30-2020, 01:05 PM
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Originally Posted by GWcpa View Post
Has anyone applied for the PPP yet? My understanding is that is not open yet??
That is what I was told by our bank this morning. They sent me the following:

At this time we are waiting on new guidance from the government on how to administer the CARES Act SBA loans. We supposedly are to receive instructions on what the application process and documentation collection process will be probably late next week. I do know we will need the following at some point:

  • Legal business name (borrower)
  • Address
  • Type of business
  • Number of employees (FT and PT)
  • EIN
  • Owners and Ownership Percentages
  • Loan amount request
  • FY19 Revenues and Expenses
  • Weekly expenses


I am suggesting to all other business owners to have the above ready so we can move quickly when the program(s) open up to the banks. There will be communications going out to at that time. Thank you.
Old 03-30-2020, 01:32 PM
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Originally Posted by 2020is View Post
There seems to either be a misunderstanding on this part or poor wording. The consensus from what I read is capped at $100k so just don't go over that for this period of time and the fact that last year was $103k won't matter. Some wording has not eligible for workers over $100k but I think "capped" is the appropriate word for this.
You thinking that in may case for example the 100K will be included but the 3K won't?

This link for our bank today is worded "Eligible payroll costs do not include annual compensation greater than $100,000 for individual employees" which sort of gives me hope but everything else I've read says differently.

https://www.venable.com/insights/pub...-to-know-about
Old 03-30-2020, 01:48 PM
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Originally Posted by jcbcpa View Post
A bank reached out to a client of mine and attached an application. I completed the application this morning, BUT just got an e-mail that it was the wrong application and they would get back with us. So, no, I don't think it's open. Looks like his bank jumped the gun. I will let you know if I find out something concrete. You do as well please.
Thanks I'm still waiting on my bank. Will do.



Originally Posted by David2 View Post
You thinking that in may case for example the 100K will be included but the 3K won't?

This link for our bank today is worded "Eligible payroll costs do not include annual compensation greater than $100,000 for individual employees" which sort of gives me hope but everything else I've read says differently.

https://www.venable.com/insights/pub...-to-know-about

I read it the loan will be eligible for forgiveness on payroll and salaries up to $100K per employee. So you may still get 2.5 time prior year salaries in the loan, but that $3k in your case will still be paid back...over a 10 year amort..

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