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Register for our upcoming webinar 6/4/2020

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Register for our upcoming webinar 6/4/2020

STAY STRONG WEBINAR SERIES:

Register for our upcoming webinar 6/4/2020

Watch our previous webinar from 5/28/2020.

STAY STRONG WEBINAR SERIES:

Watch our previous webinar from 5/28/2020.

STAY STRONG WEBINAR SERIES:

Watch our previous webinar from 5/28/2020.

WHAT'S NEW

May 8, 2020

Frequently Asked Questions: Awaiting SBA Guidance

For payroll paid during the covered period is it based on the date paid or is it based on when the payroll was incurred? Is there a limit on how much an employee can make compared to the most recent quarter if it is not in excess of $100,000 on an annual basis? Is rent, utilities, interest, etc. in arrears eligible for forgiveness if paid during the covered period? What about amounts paid in advance? For employees laid off prior to 4/27 and hired back by 6/30 is there a time period they must remain employed in order to avoid a reduction in loan forgiveness? How do you define FTE? Is it 30, 35 or 40 hours? We know non-mortgage interest is a covered cost, but is it also eligible for forgiveness? How do you measure the 25% reduction amount for payroll? For example, from 1/1/20 to 3/31/20, do you look at number of hours, rate per hour, or just total compensation during that period? If you bonused people during Q1 of 2020 that is not a part of their normal compensation, is that included when looking at the 25% reduction for payroll? What is “transportation” with regards to being a utility? Does this include mileage, gas for vehicles, etc.? Does “rent” include all leases (building, vehicle, equipment, copiers)? If not, what does it include? If a business hires new employees after 2/15/20, can they be included in the FTE count for the 8-week period? Are there any restrictions on compensation (increases) for related parties (mother, father, brother, sister, child, etc.)?

Frequently AskeD QUESTIONS

Who is eligible for the loans?

  • A small business or 501c(3) non-profit with less than 500 employees
  • A small business with over 500 employees that otherwise meets the SBA's industry size standard
  • A small business with over 500 employees that otherwise meets SBA’s alternative size standard
  • A small business with over 500 employees in the Food/Beverage and Hospitality industries
  • An individual who operates as a sole proprietor or independent contractor
  • A tribal business concern or 501c(19) Veterans Organization that meets the SBA’s size standard

Is the 500 employees noted above FTEs or Total employees?

For purposes of determining eligibility for the loan, it is 500 employees / jobs, whether they are full-time, part-time, or other.  The number of employees is not based on FTEs for loan eligibility purposes.

My business has over 500 employees. Does that mean we are not eligible for the loan?

No, it does not.  There are 3 ways a business with over 500 employees can be eligible for the loan:

  1. The Company meets the SBA’s industry size standard based on revenues. For more information and to check if your business meets this standard, click: SBA Eligibility Standards
  2. The Company meets the SBA’s alternative size standard. Companies with less than $15M of tangible net worth and average net income the last two years of not more than $5M qualify under this standard.
  3. The Company’s NAICS code starts with a 72, Accommodation and Food Services.
Additional Frequently Asked Questions

It does not appear that I can apply for an EDIL loan now, is that correct?

Announced on May 4th, the SBA re-opened their application for only agricultural business applications due to limitations in funding availability. Applicants who have already submitted their applications will continue to be processed on a first-come, first-served basis. At this point it is unclear if the application will re-open for other industries.

Who is eligible for the loans?

  • A small business with less than 500 employees
  • A non-profit organization exempt under section 501(c)(d) or (e)
  • A small business with over 500 employees that otherwise meets SBA's industry size standard
  • An individual who operates as a sole proprietor or independent contractor
  • A tribal business concern with less than 500 employees or that meets the SBA's size standard

Who provides the loans?

  • EIDL loans are provided directly from the US Treasury through the Small Business Administration (SBA).

Additional Frequently Asked Questions

I have heard about the Paycheck Protection Loans and the Economic Injury Disaster Loans. What other debt relief is the SBA offering to my business?

There is currently other relief available to those that already have existing SBA loans or enter into new SBA loans before September 27, 2020.

What exactly is the other relief being offered by the SBA?

The SBA is currently offering the following:

For current SBA loans that are 7(a), 504 or micro loans, the SBA will automatically pay the principal, interest and fees fora period of six months.

For new SBA loans that will be 7(a), 504 or micro loans issued before September 27, 2020, the SBA will automatically pay the principal, interest and fees for a period of six months.

The payments that the SBA is making – will they be tacked on to the end of the loan, or will my loan balance be reduced by the amount of payments being made?

Your loan balance will be reduced.  It is not a deferral, but rather they are forgiving six months of payments on these loans.

Additional Frequently Asked Questions

Additional Resources

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RDG+Partners wants to be the primary advisor for motivated business owners. The firm is committed to providing boutique level accounting, tax and business consulting services to the Rochester, NY community.