Comments on: How You Should Have Done Your PPP Loan

By: Stephen Nelson CPA

Stephen Nelson CPA — Sun, 09 Aug 2020 13:37:20 +0000

In reply to Barbara.

You need to be careful about two things. First, if you have reduced your headcount, you need to make sure you don’t get an FTE adjustment that causes you to lose forgiveness just because you employ fewer people. Roughly, if you cut your workforce by 10 percent, you lose 10 percent forgiveness. But a bunch of “mulligans” exist that let you wriggle out of this adjustment. So you want to know those and make sure you can use one if possible.

The second thing to be alert to: You get forgiveness based on payroll. So you may risk losing forgiveness if you don’t have enough payroll. E.g., with one less employee, you have less payroll to plug into the formula. Note that amounts you pay a 1099 contractor don’t count. Neither would amounts you pay some other business.

By: Barbara

Barbara — Sat, 08 Aug 2020 15:35:06 +0000

My tech will not come off of unemployment so I am using another company to do the jobs for me. Do I need to put them on payroll or just write a check to them? Thanking you in advance.

By: Stephen Nelson CPA

Stephen Nelson CPA — Sat, 08 Aug 2020 13:10:50 +0000

In reply to JW. You can use either 8 weeks or 24 weeks. And Rubio's bill lets small borrowers self-attest. A small borrower is someone who borrows less than $150K.

By: Stephen Nelson CPA

Stephen Nelson CPA — Sat, 08 Aug 2020 13:09:22 +0000

In reply to Barcell U Morgan. You should be able to. And you should try. Definitely.

By: Barcell U Morgan

Barcell U Morgan — Sat, 08 Aug 2020 12:07:50 +0000

If I only applied for and received the EIBL of 1000 .Can I still apply for the PPP Loan, minus the the 1000 EIBL.

By: JW

JW — Sat, 08 Aug 2020 10:35:17 +0000

How will loan forgiveness be approved? I’ve heard rumors that small for small loans the government is considering self-certification. Am I correct that since I received my funds in early May I only have 8 weeks to properly use for loan forgiveness but later loans are given 24 weeks?

By: H B

H B — Fri, 07 Aug 2020 23:08:48 +0000

Stephen, for the loan forgiveness EZ application for owner only entity. By example say 10k was the loan itself. 10k payroll paid (as 2.5 months salary) to business owner. Then on Line 5, the amount is 10k, and Line 6 the amount is 10k, and line 7 (60% threshold) is 6k. The forgiveness line is Line 8 – least of line 5/6/7 which comes out to only 6k. Even though the full example loan of 10k was used in full compliance (i.e. 100% for eligible payroll costs), only 6k will be forgiven?

By: Stephen Nelson CPA

Stephen Nelson CPA — Fri, 07 Aug 2020 19:33:44 +0000

In reply to Archie Giles. You can either use 8 weeks... or 24 weeks. Your choice. Sounds like either works.

By: Stephen Nelson CPA

Stephen Nelson CPA — Fri, 07 Aug 2020 19:32:47 +0000

In reply to Tamara. I think you go back to BofA and ask for a PPP loan increase based on later regulations saying you can include your owner compensation replacement.

By: Tamara

Tamara — Fri, 07 Aug 2020 18:35:00 +0000

I did a first round of PPP in May. I am self employed with a couple of seasonal employees and family members. I applied as a self employed sole proprietor. B of A asked for 940’s and I was given only the amount that would cover payroll, They eliminated my pay and rent. I’m being encouraged to go for round 2 but I don’t know if I should go back to B of A or file directly from the SBA website application form. Thanks for your help!