First and foremost, I hope you are safe and healthy. We are living in a new state of awareness and there is finally hope our economy and our businesses can begin to move forward, even though it’s still a complicated and confusing time. I am here for you.
So much has happened over the past month and things continue to change daily. Staying updated is near impossible and I know it feels overwhelming. I’ve been busier than ever working with clients and helping them submit applications for various relief efforts. I wanted to share some knowledge this month and also encourage you to reach out to me if I can help you in this process.
There are many options when it comes to getting funding from the local, city, state and federal level. All have their own unique set of circumstances and conditions. The information and requirements seem to be changing daily, as well.
A lot of the FEDERAL and STATE funding has been allocated, but it’s not gone. More money is going to be available, so it’s important to submit your application in a timely manner and stay positive. There are also many independent foundations assisting small businesses.
Here is some information on the Federal and State levels:
The Small Business Administration has the Economic Injury Disaster Loan, which may also contain an advance of $1,000-$10,000 depending upon the number of employees for the small business. There is also an actual loan from the SBA, which has an interest rate between 2.5 – 3.75% for 30 years. This may be an option for your business. https://www.sba.gov/funding-programs/disaster-assistance
You’ve most likely heard of the CARES ACT, which contains the Paycheck Protection Program (PPP), which is an SBA loan for small businesses, acquired directly through your business bank. The purpose of the PPP for the government is to keep the workers on the company payroll, not go on to state and federal unemployment. The SBA will forgive this loan if the money is used within eight weeks for payroll (including self-employment), rent, healthcare for your employees, mortgage interest or utilities.
The money is deposited directly into your account and you have from that day on to spend the funds. You must keep accurate records and prove where those expenses went over the eight-week period. This money needs to be categorized properly, it is NOT income and you will not pay taxes on it.
If you DO NOT use the funds in the time allotted, it will not be forgiven and is still considered a loan that must be repaid at an interest rate of 1% over the course of two years.
Call me to set up the proper reporting requirements to ensure the money is tracked and categorized properly and in a timely and accurate process. Set up a meeting to discuss the PPP.
You might have also heard that even those considered self-employed and gig workers can now apply for Unemployment Compensation. Please realize this has never happened before!! AND do not apply for unemployment compensation if you get the PPP loan. The additional Federal benefit is $600 a week, on top of the State Pandemic Unemployment Assistance, and continues through July 25th. This is a grey area and all states have different guidelines, so reach out to me and we can chat about your options. The PA site just opened this past Saturday morning.
Along with the Rotary Club of the Upper Main Line, I’m holding two virtual seminars via Zoom. One is tomorrow 4/22 at 7:15am and one is Wednesday, 4/29 at 5:15pm to discuss COVID-19 resources and expense deferrals available to different kinds of businesses. To attend, please RVSP by email to [email protected] and we will reply with the Zoom meeting link.
If you can’t make those and/or want to set up a private, complimentary call with me, you can do that right here.
The PTCFO Monthly Breakfast Series has become a weekly, virtual event!!