18 Days and Counting
Over $120 Billion in Payroll Protection Plan Relief funds are still available (through June 30th) for small business owners. The Federal Government is a bit perplexed on why businesses aren't gobbling it up. They even tried to make it easier last week with the passing of the Flexibility Act.
We have a few theories, but before we pass judgement, we thought we’d give you a run down on the latest from Washington so you can exit June with no regrets.
For Those Who Applied Already—Here’s What We Know
Major money center banks failed small businesses
Small business owners should ditch accounts with the major money center banks and move to local and regional banks. When push comes to shove, the top 5 banks (you know who they are) showed their true colors by abandoning small business clients and taking care of their big accounts.
Even worse, they are now using the hundreds of millions in fees they collected by turning their backs to run ads about how much they love small business.
Minority-owned businesses had lower approval rates
For people who think the BLM movement isn’t for real: Minority-owned businesses saw an approval rate of 56% in comparison with 76% for non-minority owned businesses. We need to do better.
The Flexibility Act made it easier for your loans to be forgiven
They dropped the payroll requirement from 75% to 60%, extended the amount of time you can use the money from 8 weeks to 24, and extended the period without interest until you have ruling on forgiveness.
You are forgiven—maybe yes, maybe no
But if you are still confused about whether or not your loan is going to be forgiven, check out this new app from Intuit. You can plug in your numbers, and it will show you where you stand.
For Those Who Have Not Applied—Here’s What We Know
Solopreneurs, independent contractors, or self-employed do qualify for relief
If you are a solopreneur, independent contractor, or otherwise employed on your own, you can apply for relief. Here’s a chart we created just for you.
Lack of financial resources is #1 concern
The number one concern of business owners is not having financial resources to get through the recovery. If you are in that bucket, at least make sure you have availed yourself of all of the funding options (PPP, EIDL grants, EIDL loans).
If you have questions, post them on Alignable. We will send it out to the 50,000+ accountants on the platform. Many have spent a lot of time getting up to speed on all the options and are willing to share advice with you.
Go local or regional if you want to apply
Thinking of applying? Based on approval and response rates, we’d suggest you go either to a local / regional bank or one of the online providers like Square, PayPal, Intuit, or one of the others you can find here on the SBA website.
If you don't, take advantage of other government resources
Never going to do it? There are a lot of reasons why you may not want to or need to apply for a PPP loan for your business.
That said, don’t forget the government also put in place some other resources for business owners you should know about. These include:
- The ability to defer tax deposits and payments
- A credit for retaining employees
- Increased deductions for interest expense
- And many other little items that could add up to savings for you and your business
Talk to your accountant now
Net / net: Now would be a great time to talk with your accountant to make sure you are taking full advantage of the CARES Act in 2020.
Hint: Again, we have 50,000+ accountants on Alignable who are more than happy to answer your questions. Ask your question here, and we'll get them to answer it for you.
Comments (1-10)
I am just about to run out of the PPP money and am not sure I will be able to continue to pay my one employee her usual full time pay. My business has improved but is still down about 60-70%.
1) Will there be an opportunity to obtain a second PPP grant?
2) Any possibility that the EIDL will convert to a grant? I am hesitant to use the money for fear that my business won’t make it through he end of the year.
Thank you,
Michelle Schneider
I am a sole proprietor and only have one volunteer who works in my workshops with me. My main income is from art workshops in senior care facilities that are closed by COVID19. I have had no workshops for three months and don't know when I can restart. I am exploring doing Zoom with them which may rescue my business.
It’s was useless unless you produced enough income to make it worth it to the financial institution to work with you. Too confusing to navigate! Not enough time to navigate before larger companies sucked it dry ... finally just gave up
The PPP loan was great so that we could keep our employees working and keep them from drawing unemployment. I would like for everyone to open their business up, let people start traveling, and open up the national forests and parks. When this happens no one should need another loan. Let’s get back to work!
I mean it really doesn't make sense to get help to get out of debt just to get right back in debt
Because I don’t want more debt it’s better to tighten things up and ride it out.
As a janitorial company, we only had a small impact when the closing and temporary closings of 3 nonessential companies were forced to close. I never laid off any of my employees, but offset their loss of time in other services that we provided. This allowed me to continue to keep 100% of my workforce.
I don't need hand out. Gives with one hand and take with two. I don't want artificial mercy
My business has been denied funds because we are a ineligible business dealing with cbd and holistic health. We are way more essential that most deemed to be. Any assistance on how to get funding would be greatly appreciated. This is an extremely difficult time, and we're not being given a fair share at bouncing back.
Is anyone else unable to login to their SBA loan account?!!! This incompetency goes beyond what anyone who is suffering from this imposed devastation!! I’ve been fortunate to have been approved for all three loans- PPP, the Advance and the EIDL. I immediately received funds upon approval for PPP and the Advance. When I was invited to join the Portal upon my EIDL approval on May 19th, I made it all the way through to the part to sign the loan documents. It was unclear as to how to retrieve these docs. But there were no prompts to denote there was more to complete before logging out. I waited for almost two weeks for the funds to be deposited which didn’t happen. Subsequently, I have spoken with SBA representatives who expedited my case to no avail, tried to login more than 100 times with no success, had my IT guy investigate who said it was the SBA website that was simply not responding. This is maddening to a new level! All I need to do is log in and sign my paperwork then I can receive my funds. No one is able to email or fax these documents to me. I must do this online. I’ve been told by every single Rep that it’s not me or my login information; it’s all in their end because everyone is experiencing the same problem.
I just finished another call today with an empathetic Rep who offered to expedite my concerns to the IT department and then try again on Monday. That was really all she could do to help me.
Because of this severe lack of customer concern on the part of the SBA to address this omnipresent and pervasive problem in a prompt and timely fashion, I was forced to close my business yesterday so my employees can file for unemployment.
Shame on the SBA for abandoning and ignoring the cries and pleas for help from so many companies forced to lock their doors whether indefinitely or permanently! This is the epitome of disgraceful government ineptitude!!! Those of you who are reading these impossibly frustrating difficulties and are in a position to garner the attention of the ONES who can fix such ridiculous problems, it is incumbent upon you to Respectfully Shout Out from your highest platform on behalf of ALL SMALL BUSINESSES that really qualify as SMALL but whose affects are MIGHTY within their communities!!!!
Is anyone REALLY listening to us??!?!? PLEASE SOME ONE.... HELP US SURVIVE!!!!
Kathy Freund