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Old 03-30-2020, 01:54 PM
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Originally Posted by GWcpa View Post
Thanks I'm still waiting on my bank. Will do.






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..
Per my accountant, do what is above, swag the amount if needed and don't be afraid to ask to more just to be sure that it covers what will be later calculated as forgivable. Then what is not will be a loan. And unlike an SBA loan, no prepayment penalties.
Old 03-30-2020, 01:54 PM
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Originally Posted by GWcpa View Post

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..
I really hope you are right.

Although the 2.5X is just the max you can borrow - up to 10M. I'm thinking we may just go up to what's forgiven but that remains to be seen. That said, 4% over 10 years without any personal guarantee and no prepayment penalty sure is appealing.
Old 03-30-2020, 02:03 PM
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Looks like they removed the forms and now it's a online app you fill out
Old 03-30-2020, 02:04 PM
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You are not going to borrow a Years salary though. 103k/12 is $8,583/mo. Wouldn’t you just borrow $17,166 to cover the. 2 mos. which they are telling you it needs spent thus borrowing well under the 100k?
Old 03-30-2020, 02:05 PM
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Originally Posted by David2 View Post
I really hope you are right.

Although the 2.5X is just the max you can borrow - up to 10M. I'm thinking we may just go up to what's forgiven but that remains to be seen. That said, 4% over 10 years without any personal guarantee and no prepayment penalty sure is appealing.

Yes, he is correct. It is up to 100K annualized ( capped at roughly $1,923 per week) for the amount to be forgiven but you will be able to get a loan for the 250% of your average monthly payroll. The 3K over 100K you received (or roughly $58 per week) will be able to be part of the loan but not be qualified to be forgiven but you can use that money on other things such as rent, utilities, health insurance, etc

At our CPA firm we have not had anyone be able to get a PPP loan yet. We are being told they will not be given until Friday. The Economic Injury Disaster Loans have been going through from sba.gov and those will be able to roll into a PPP loan.

Several lenders that I talked to this morning will be able to give out the PPP loans but did not know it before I called them, this is all very new and the lenders are trying to catch up to what the bill says (including the SBA).

Last edited by SLT Kota; 03-30-2020 at 02:11 PM.
Old 03-30-2020, 02:09 PM
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Originally Posted by JointAsset View Post
You are not going to borrow a Years salary though. 103k/12 is $8,583/mo. Wouldn’t you just borrow $17,166 to cover the. 2 mos. which they are telling you it needs spent thus borrowing well under the 100k?
Correct. I was just speaking generally if over $100K is excluded completely from being forgiven.
Old 03-30-2020, 02:10 PM
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Originally Posted by SLT Kota View Post
Yes, he is correct. It is up to 100K annualized ( capped at roughly $1,923 per week) for the amount to be forgiven but you will be able to get a loan for the 250% of your average monthly payroll. The 3K over 100K you received (or roughly $58 per week) will be able to be part of the loan but not be qualified to be forgiven but you can use that money on other things such as rent, utilities, health insurance, etc

At our CPA firm we have not had anyone be able to get a PPP loan yet. We are being told they will not be given until Friday. The Economic Injury Disaster Loans have been going through from sba.gov and those will be able to roll into a PPP loan.

Several lenders that I talked to this morning will be able to give out the PPP loans but did not know it before I called them.
Awesome! Thanks for chiming in.
Old 03-30-2020, 02:12 PM
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Originally Posted by JointAsset View Post
You are not going to borrow a Years salary though. 103k/12 is $8,583/mo. Wouldn’t you just borrow $17,166 to cover the. 2 mos. which they are telling you it needs spent thus borrowing well under the 100k?
Good point. The overview I'm reading says "2.5X average monthly payroll costs during the 1-year period before the date on which the bank loan is made..." However you determine that.

This includes:

Payroll costs (comp above $100K excluded...so $8,333 x 2.5 for the employee over $100k comp prior year on W2? )
Interest on mortgage
Rent
Utilities.
Health care costs/premiums paid by employer


So if payroll costs are $100K per month avg prior year $250k plus the above expenses for 2.5 months.

Payback forgiveness on actual amount, payback the rest on 10 year amort.



Up to $10 million
Old 03-30-2020, 02:20 PM
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Originally Posted by reeltateredfishin View Post
Filed this morning, pretty painless. We will see how long it takes to get the $
What bank if you do not mind sharing
Old 03-30-2020, 02:23 PM
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Originally Posted by GWcpa View Post
Good point. The overview I'm reading says "2.5X average monthly payroll costs during the 1-year period before the date on which the bank loan is made..." However you determine that.

This includes:

Payroll costs (comp above $100K excluded...so $8,333 x 2.5 for the employee over $100k comp prior year on W2? )
Interest on mortgage
Rent
Utilities.
Health care costs/premiums paid by employer


So if payroll costs are $100K per month avg prior year $250k plus the above expenses for 2.5 months.

Payback forgiveness on actual amount, payback the rest on 10 year amort.



Up to $10 million

This is what I am reading as well though I believe you can borrow 2.5X your total monthly payroll, the 100K annualized cap I believe is just for the amount forgiven, not the amount borrowed.

The section of the bill that calculates how much you can borrow does not mention a cap at 100K annualized.


“(aa) the product obtained by multiplying—

“(AA) the average total monthly payments by the applicant for payroll costs incurred during the period beginning on January 1, 2020 and ending on February 29, 2020; by

“(BB) 2.5;

“(bb) the outstanding amount of a loan under subsection (b)(2) that was made during the period beginning on January 31, 2020 and ending on the date on which covered loans are made available to be refinanced under the covered loan; or

“(ii) $10,000,000.
Old 03-30-2020, 02:28 PM
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Originally Posted by SLT Kota View Post
This is what I am reading as well though I believe you can borrow 2.5X your total monthly payroll, ...
Agree, as long as to you the word payroll means not just payroll costs but also rent, mortgage interest, utilities (what was said earlier).

And per our accountant, rent can be paid to another entity that you own, as long as the rental agreement was in place before Feb, 2020 (look up exact date).
Old 03-30-2020, 02:32 PM
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Originally Posted by SLT Kota View Post
Yes, he is correct. It is up to 100K annualized ( capped at roughly $1,923 per week) for the amount to be forgiven but you will be able to get a loan for the 250% of your average monthly payroll. The 3K over 100K you received (or roughly $58 per week) will be able to be part of the loan but not be qualified to be forgiven but you can use that money on other things such as rent, utilities, health insurance, etc

At our CPA firm we have not had anyone be able to get a PPP loan yet. We are being told they will not be given until Friday. The Economic Injury Disaster Loans have been going through from sba.gov and those will be able to roll into a PPP loan.

Several lenders that I talked to this morning will be able to give out the PPP loans but did not know it before I called them, this is all very new and the lenders are trying to catch up to what the bill says (including the SBA).
Whoa...can you elaborate? So you can convert the Economic Injury Disaster Loan to a PPP?

I had thought it was either/or?
Old 03-30-2020, 02:33 PM
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I am still not 100% sure on my last statement on being about to borrow 2.5X on the payroll over 100K annualized, the wording is a bit unclear to me in the bill.

https://www.congress.gov/bill/116th-...D8B58B1EC16623
Old 03-30-2020, 02:34 PM
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Could you take a lower interest loan than what SBA offers to offset the payroll above 100k?
Old 03-30-2020, 02:40 PM
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Originally Posted by emudryj View Post
What bank if you do not mind sharing
Read above. That’s a SBA Disaster Loan which is completely different.
Old 03-30-2020, 02:46 PM
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We had another thread on this a few days ago and it got buried. I still have MANY questions about how this works and so far I can't find many answers. I asked these on the other thread and will ask them here.....

I am open for takeout only doing limited hours and minimum staffing. Some people are layed off, some are full time and some are part time. I have been searching and reading since trying to answer these questions.

If we do this loan am I supposed to pay everybody and let them sit home and close the business for for up to 8 weeks?

If we do this loan and I am open for a limited hours can I make everybody come back to work with the old regular schedule even though there may be nothing for them to do? If I Stay open Limited hours some people will have to work and some may be allowed to stay home getting paid that is definitely going to cause problems.

I have at least one person that has applied for unemployment. He will get a max of 275 per week and then an additional 600 a week until july 31st to sit home. How am supposed to get him to come back to work when he will be making double the money sitting home? If he doesn't come back I get penalized if we take the loan.
Old 03-30-2020, 02:55 PM
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[QUOTE=SLT Kota;13495349]I am still not 100% sure on my last statement on being about to borrow 2.5X on the payroll over 100K annualized, the wording is a bit unclear to me in the bill.
https://www.sbc.senate.gov/public/in...-the-cares-act

I'm not sure either, but if you go to this link and click on "guide" and scroll down to the top of page 4 and read "How is the forgiveness amount calculated", it says that you have to exclude compensation over 100K. I don't know. It's a little confusing. Hopefully we will get some better guidance soon and will be able to answer some of these questions.
Old 03-30-2020, 02:57 PM
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Originally Posted by GWcpa View Post
Whoa...can you elaborate? So you can convert the Economic Injury Disaster Loan to a PPP?

I had thought it was either/or?
At this time we believe you can get both and roll the EIDL into a PPP BUT the EIDL will probably be subtracted from the amount forgiven under the PPP. There is still some debate at our office as to if the two are used for different things if you will be able to get the EIDL forgiven without being subtracted from the amount forgiven on the PPP (personally I don't think the EIDL amount will be subtracted from the amount forgiven under the PPP).

According the the "Small Business Owners Guide to CARES Act"
Source: F2CF1DD78E6D6C8C8C3BF58C6D1DDB2B.small-business-owner-s-guide-to-the-cares-act-final-.pdf

Under the frequently asked questions it says:

QUESTION: If I get an EIDL and/or an Emergency Economic Injury Grant, can I get a PPP loan?

Answer: Whether you’ve already received an EIDL unrelated to COVID-19 or you receive a COVID19 related EIDL and/or Emergency Grant between January 31, 2020 and June 30, 2020, you may also apply for a PPP loan. If you ultimately receive a PPP loan or refinance an EIDL into a PPP loan, any advance amount received under the Emergency Economic Injury Grant Program would be subtracted from the amount forgiven in the PPP. However, you cannot use your EIDL for the same purpose as your PPP loan. For example, if you use your EIDL to cover payroll for certain workers in April, you cannot use PPP for payroll for those same workers in April, although you could use it for payroll in March or for different workers in April.
Old 03-30-2020, 03:05 PM
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Originally Posted by jcbcpa View Post
I'm not sure either, but if you go to this link and click on "guide" and scroll down to the top of page 4 and read "How is the forgiveness amount calculated", it says that you have to exclude compensation over 100K. I don't know. It's a little confusing. Hopefully we will get some better guidance soon and will be able to answer some of these questions.

So far the guide that you mentioned is the best that I have read and is the most accurate to what the bill says (I've spent more time than I care to admit reading the bill itself trying to make heads or tails of all of this). I talked to the SBA directly this morning and they were completely clueless and too busy trying to keep their systems from crashing... again.

Direct link for others to read:
F2CF1DD78E6D6C8C8C3BF58C6D1DDB2B.small-business-owner-s-guide-to-the-cares-act-final-.pdf
Old 03-30-2020, 03:10 PM
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I work at one of only 14 non-bank licensed SBA lenders. If anyone has questions or would like more information please feel free to private message me. Being a private company we strive to be fast and hassle free as possible.

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