Tag Archives: PPP loan

COVID-19 Financial Relief, Education, Illinois, IRS, Site News, Tips

What The ARPA, ERC, PPP And Other Laws Mean For Your 2020 Taxes

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Recent new legislation from Congress and the White House, as well as guidance from the IRS and DOL, has caused sweeping changes for small business owners and individuals, and we tax preparers are still trying to wrap our heads around it — during what was already the most complex and demanding tax season on record.

Specifically, the American Rescue Plan Act (ARPA) included a few provisions that are retroactive to 2020 — and the IRS, various state Departments of Revenue, Department of Labor, and tax software programs are trying to figure out how best to implement these changes as efficiently as possible. (For a breakdown of key provisions in the Act, see this excellent summary.)

These changes include:

1) The first $10,200 per person of 2020 unemployment benefits will no longer be taxable at the federal level, though certain states will continue to tax the full amount (Illinois has asked all taxpayers with unemployment income to hold off on filing returns until the Dept of Revenue has addressed the situation). The IRS will be releasing a worksheet that the tax software companies then need to incorporate into the 1040 returns.

2) A 2020 “Repayment Holiday” for the Marketplace Health Insurance Advance Premium Tax Credit was issued, but implementation questions remain; IRS guidance is expected soon.

3) Another economic impact payment (stimulus check) is on its way. You do not need to file your 2020 tax return right now to claim your check, as the law allows for an additional payment in a few months if your 2020 tax return shows you are entitled to more (vs your 2019 tax return). Conversely, if your income went up in 2020 and you are now ineligible for the full benefit, you’ll want to wait to file your 2020 taxes until after your payment arrives, since you won’t have to pay back the overage on your 2021 tax return.

In addition to the above legislative shifts, the IRS recently released guidance concerning the Employee Retention Credit (ERC) that changed our expectation of how it would be handled on business tax returns for cash-basis business tax filers. Previously we had expected that those who received PPP funds in 2020 and can now (as of the Dec 21 Consolidated Appropriations Act) retroactively claim ERC would adjust for the related deductions on their 2021 tax returns. Not so. These adjustments will have to be made on the 2020 tax returns. As a result, we have had to put approximately 75% of our client business returns on extension.

(Technical note: keep in mind if you are doing tax returns for a client that claimed ERC, not only do you have to reduce deductible wages by the amount of the credit, but also recognize this reduction may impact Section 199A eligible wages for purposes of the 20% qualified business income deduction.)

And yet we are still awaiting essential guidance on whether or not the Employee Retention Credit can be taken on wages paid to >50% owners of a company. Interpretations by tax analysts so far are pretty much split evenly between whether the law as [sloppily] written provides reasonable basis in this area.

I’m guessing you see the challenge here: we don’t yet know the rules for claiming the ERC, and yet we have to report related adjustments (as a direct result of the credit calculation) on the 2020 business tax returns. Most of these returns have a flow-through relationship with the business owners’ personal tax returns — so those may have to be placed on extension as well if we do not get guidance soon.

(Related blog post: please call your representatives and ask for all taxes — estimated quarterly as well as corporate — to be extended; not just the Form 1040.)

We are also expecting guidance about how the IRS wants business owners to treat basis reporting for owners where PPP forgiveness causes issues.

Yet another example of a forced need to wait on certain returns: using tax filing software, we can e-file a return today, but set the payment direct-debit date to a future date — not later than the return due-date. This date has not yet been updated in most tax prep systems to go beyond April 15th to the new due date of May 17th.

It’s particularly frustrating for us as small business advocates, because filing a tax return is the only way to get a refund if you’re owed one, and many of our clients may be more in need this year than usual. And yet, for a large number of taxpayers right now, holding off on filing is the recommended approach.

All the while we are trying to help our small business clients respond to 2021 changes, such as important employment law updates; alterations to COBRA and Marketplace subsidies; major modifications to the current round of the Paycheck Protection Program (PPP); new relief programs such as the Shuttered Venue Operators Grant (SVOG) and the Restaurant Revitalization Fund (RRF); the aforementioned ERC/PPP maximization… and so much more.

The provisions noted above — and others — may affect your return. Tax professionals everywhere need some time and space to learn about these changes, analyze their impact, and develop personalized recommendations to maximize your COVID-19 tax benefits. Please be patient with us during this extremely stressful time.

If this or any other posts on the website were useful to you, and your financial situation permits it, please consider contributing to my tip jar. Ths allows me to continue to provide free accounting resources to small businesses who do not have the funds available to hire a CPA.

COVID-19 Financial Relief, Illinois, IRS

PPP Loans Taxable In 19 States – Is Yours One Of Them?

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Kimberly Weisul — who refers to herself accurately as a “professional explainer” — recently published this excellent article in Inc. Magazine on the state-by-state treatment of PPP funds.

Nineteen states have effectively taxed this income, either directly or by denying related expenses. And interestingly enough, seven of those states have legislation currently pending to make these funds non-taxable; at this rate, they are unlikely to get approved before tax season is over.

(I may complain plenty about Illinois’ tax laws, but thankfully they have conformed with the federal guidance here.)

The Tax Foundation provides an excellent list of which states tax PPP income and/or deny PPP expense deductions — and goes deeper into the weeds for states that may not have Income Tax but do have a Gross Receipts Tax. Do yourself a favor and check it out before filing your taxes.

If this or any other posts on the website were useful to you, and your financial situation permits it, please consider contributing to my tip jar. This allows me to continue to provide free accounting resources to small businesses who do not have the funds available to hire a CPA.

COVID-19 Financial Relief, Education, IRS, Site News, Tips

Tips To Maximize 2020 Employee Retention Credit (ERC) & PPP Interaction

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I recently wrote about reasons to hold off on Paycheck Protection Program (PPP) forgiveness applications for the time being. Among them is the complex interaction between PPP and the Employee Retention Credit (ERC), which previously was not permitted as an option for financial relief for those that had received PPP funding.

Because ERC is now available for small businesses who have accepted PPP funds — but not for the same payroll dollars (no double-dipping) — there are some pretty complicated calculations that, if done right, could generate a great deal of financial relief to a lot of independent business-owners in need.

The IRS came out with guidance on March 1. The Journal of Accountancy summarizes:

The notice explains (1) who are eligible employers; (2) what constitutes full or partial suspension of trade or business operations; (3) what is a significant decline in gross receipts; (4) what is the maximum amount of an eligible employer’s employee retention credit; (5) qualified wages; (6) how an eligible employer claims the employee retention credit; and (7) how an eligible employer substantiates the claim for the credit.

Summary of the 2020 Employee Retention Credit

As a reminder, the 2020 ERC is a payroll tax credit available to business owners whose operations have been fully or partially suspended by government order, or who have seen a drop in income of more than 50% compared to the same quarter in the previous year. (Note: in the new IRS guidance it also states that if “the business’s suppliers are unable to make deliveries of critical goods or materials due to a governmental order”, your business may be eligible for ERC — even though there was no governmental order in your area.)

The credit comprises 50% of up to $10,000 in wages to each employee. The credit cannot be taken on wages that were paid for by PPP funds — but as long as there is no double-dipping, PPP recipients can claim other wages for the purpose of ERC.

The ERC is claimed as a reduction of payroll taxes on quarterly Form 941 (or a prepaid refund on Form 7200). The IRS updated the form on July 1, and a handy breakdown of the new lines can be found here. There are different rules for eligible businesses to be able to claim the 2021 ERC moving forward — a topic for another day — but this post concerns the opportunity to “scoop up” payroll dollars from 2020 that would have been eligible for ERC had it not been for the PPP Loan. These can be claimed by filing an amended Form 941 for each relevant quarter.

Keep in mind that the ERC is complex, and this blog post will not walk you through the specifics — I’ve included a list of some of my favorite resources below. The goal here is to share the steps in our firm’s approach toward these calculations for our clients.

So let’s start with a couple of things to be aware of before we go through the steps that my firm plans to walk through come May/June.

  1. First, the ERC is not generally as valuable as the PPP. It is a payroll tax credit, rather than actual cash funding (though you can file for an advance on it).
  2. And the ERC did not get the benefit of having Congress declare its related expenses deductible, like the special treatment that PPP costs received. So you will lose all the deductions for the payroll tax dollars on which you receive the credit. Deductions aren’t worth as much as credits, so you still come out ahead. But if you’re choosing PPP or ERC for a given payroll dollar, you want to pick the PPP first — up to the minimum 60% requirement for that loan to be forgiven.
  3. However, once you’ve reached that 60% requirement, if you can use non-payroll costs for the remaining 40%, then you “free up” the rest of the payroll dollars to be used for ERC. So you’ll want to work on PPP1 forgiveness applications at the same time as 2020 ERC calculations — they are related to each other, and changing one will potentially affect the other.
  4. But what does this mean for companies filing income tax returns for 2020? Businesses that later decide to retroactively claim the ERC will need to file amended income tax returns — or preferably, put their income tax returns on extension until they have claimed the ERC for 2020. We had previously thought that cash-basis filers could potentially claim the income for the credit and the associated reduction in payroll costs on the 2021 income tax return, but that was ruled out with the most recent IRS guidance.

Steps to Evaluate Payroll for PPP vs ERC

The hope is that in most cases you’ll be able to do Steps One and Two and skip the rest. But just in case, Steps Three and Four will take you the rest of the way there.

Step One
When figuring out how to combine ERC and PPP, literally make a calendar for each client and work from that.

a) Determine dates for which you qualify for ERC, based on either:
– the full or partial shut-down period, or
– a gross receipts decline of 50% over the same quarter in 2019
(the latter qualifies you from the beginning of that quarter to the end of the quarter where receipts go back up to 80%)

Keep in mind that both scenarios may apply, but for different periods — for example, the business was shut down on 3/18/20, and then later fully reopened… and then the 50% revenue drop started in the following quarter.

Note: you may want to find out the exact dates that your client’s city/county/state decreed full-capacity indoor dining was illegal — for those dates, restaurants qualify for ERC based on “full/partial shut-down” rules. If your client is a gym, bar, or other type of non-essential business that had hours limited, find out the exact full-or-partial shut-down dates decreed for that industry in that specific area.

b) Determine PPP covered period. For most folks, this will be the 24 weeks starting on the date of loan fund disbursement.

c) Determine the “bookend” periods — the time both before and after the PPP covered period; for the timeframe when the client qualified for ERC but was not in the PPP realm.

Step Two
You may be able to skip the rest of the steps by eyeballing whether you’re able to claim the entire 2020 ERC of $5k per employee (on the first 10k paid to each) all in one quarter — for most businesses this would usually be the final quarter of the year. Then, not only will you not have to worry about overlapping PPP and ERC payroll dollars, but you also will be able to claim this through most payroll companies and not have to manually amend the 4Q 2020 Form 941. Double-bonus!

If not, then see if you can get the full $5k per employee ERC (again, on the first 10k paid to each) using only the periods before and after the PPP1 covered period. You at least eliminate the need to juggle the PPP payroll dollars along with the ERC payroll dollars during the covered period.

Step Three
If that’s not an option — if you can’t get to the full 10k within the bookend periods — then:

Before you work on PPP1 forgiveness, subtract whatever the 2020 unallocated ERC balance is after Step 2 (not to exceed 10k of wages per employee) from the payroll amounts during the PPP covered period — before putting numbers in the forgiveness application, just to make sure you can still get full forgiveness at this rate. This is just a “gut check” to see if you can eliminate the need to run the actual ERC calculations for the PPP covered period.

If so, then go ahead and take ERC on the difference, even if you haven’t figured out the specifics of your PPP1 forgiveness yet.

Step 4
If you can’t get full forgiveness on PPP1 at this rate, then go ahead and fill out the PPP1 application in full, using only 60% of the PPP funds to allocate payroll.

Then see how many payroll dollars are “left over” to be used for ERC.

And remember that you can use payroll from employees who made over $100k annually for ERC during the PPP period — because those dollars are not eligible for PPP (due to rules and limitations specific to that program), but they are eligible for ERC.

You can also count — for ERC purposes — dollars that were above 60% of the PPP loan, and therefore are not needed for forgiveness (presuming the business has sufficient eligible costs to make up the 40% “non-payroll” portion of PPP forgiveness).

Think of it this way: you are effectively reducing the ERC subtraction amount per-employee from PPP forgiveness until you get to full PPP forgiveness… and taking 2020 ERC on the balance (since as I mentioned before, the PPP payroll dollars are more tax-advantaged than the ERC dollars).

Does this four-step process sound easy? No! It’s not. It may not in fact be worth it for most small business clients to pay a professional to scoop up the remaining piddly amounts in the PPP covered period — in which case, consider just using Steps One and Two: the amounts in the bookend periods, or even better, just the amount from the final quarter (because that way they don’t have to pay you to manually prepare a 4Q Form 941, either).

But reviewing this approach before going in and working on all the client ERC and PPP calculations should help a great deal in identifying where the bulk of the payroll dollars are that will qualify for the ERC program, and will allow you to make intelligent decisions about which periods to mine for this type of financial relief for your small business clients.

Resources

For a wonderful in-depth explanation of the Employee Retention Tax Credit, please see Tony Nitti’s two-part Forbes article:
– Breaking Down Changes To The Employee Retention Tax Credit In The New Covid Relief Bill, Part 1
– Breaking Down The Changes To The Employee Retention Credit In The New COVID Relief Bill, Part 2
– Part 2 also links to an earlier article of his that goes through the details of calculating the ERC according to the 2020 rules.

KBKG is offering a free one-hour webinar on March 17:
– Employee Retention Tax Credits: Qualifications, Benefits & Refunds (kbkg.com)
–This is the same firm that offers the free 2021 ERC estimator calculator.

The three paid courses I’ve taken so far that were the most valuable were:
– Tom Gorczynski‘s Employee Retention Credit Update, which included an Excel Calculation Template.
– AICPA – The NEW Employee Retention Credit: More for Eligible Employers
– NATP (natptax.com) – Calculating the Earned Income Credit

If this or any other posts on the website were useful to you, and your financial situation permits it, please consider contributing to my tip jar. Ths allows me to continue to provide free accounting resources to small businesses who do not have the funds available to hire a CPA.

COVID-19 Financial Relief, Education, IRS, Site News, Tips

Why You Should Still Hold Off on PPP1 Forgiveness Applications

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Many clients and colleagues have reached out to me over the past two months to ask whether they should apply for PPP1 forgiveness yet, and my answer (and that of the AICPA) is still “not quite yet”. But rather than just pushing off the question of “but when” into the future, I wanted to publicly share our company’s strategy and timeline for handling these applications.

The deadline to apply for Paycheck Protection Program (PPP) forgiveness is 10 months after the end of the covered period — which for most folks for the first round was 24-weeks — so that wouldn’t be until sometime in July 2021 for the earliest borrowers. (It’s not really a deadline, but it’s the date on which the lender will start requiring loan payments, so I think of it as one.)

We’re planning to dedicate May & June 2021 to working through all our existing clients’ PPP forgiveness applications. There are many clarifications we’re still waiting for (they keep dribbling out of Congress, IRS, and the SBA bit by bit, with occasional leaps), and the interaction between the PPP and other types of financial relief is complex.

In particular, the rules surrounding the 2020 Employee Retention Credit — which until recently was not an option for PPP borrowers — are vague and complex, even with the recent IRS Notice and FAQ. Furthermore, most payroll companies have not figured out how to collect the information and prepare the 4th-quarter Form 941 forms for partial quarters, and we may end up having to file some ERC requests manually. (Don’t get me started on this one.)

An example of how the changing rules affect applications: the EIDL advance grant was previously supposed to be subtracted from PPP forgiveness; but by asking our clients to wait on their forgiveness applications, they were able to take advantage of a December 2020 change that removes this requirement, saving them many thousands of dollars. (Though thankfully, it sounds like SBA will eventually refund those amounts to businesses who applied before this new rule went into effect.)

As if these reasons weren’t enough, in a recent on-demand AICPA Town Hall, they mentioned that:
– Most lenders are not actively taking forgiveness applications because their teams are focused on administering PPP2.
– SBA is working very slowly on forgiveness process because they are also focused on PPP2.
– The new simplified form for $150k and under will not be worked into the SBA system until sometime in March.

Between the constantly-changing rules for PPP and the guidance and calculations needed for ERC, we’re still following the recommendation of the AICPA and asking folks to hold off on PPP1 forgiveness applications, until tax season is behind us all and the IRS can focus on the remaining questions, allowing us to be methodical and consistent in our approach.

There’s no reason to be nervous about holding off on forgiveness — of the one-third of PPP loans that have been submitted for forgiveness, fully 99% of the loan dollars have been forgiven. The very small amount that have not are small loans at only 1% interest. Furthermore, by waiting you are giving your business the best chance at maximizing other types of financial relief, especially as the new Biden-Harris administration is in the process of changing rules to make them more attainable for a larger number of the smallest businesses out there, as well as Congress creating new funding opportunities.

(For tips on planning for the potential Employee Retention Credit, see my next blog post.)

If this or any other posts on the website were useful to you, and your financial situation permits it, please consider contributing to my tip jar. This allows me to continue to provide free accounting resources to small businesses who do not have the funds available to hire a CPA.

Cooperatives, COVID-19 Financial Relief, Education, IRS, Tips

Changes to Paycheck Protection Program (PPP) Starting Feb 24

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A slide from this morning’s CPA Loan Portal-AICPA update.

Big changes yet again in the world of the Paycheck Protection Program (PPP), where it sometimes seems the only constant is change.

The White House released a Fact Sheet early yesterday indicating immediate changes to the program intended to shift focus to small businesses with few or no employees, and increase program access to those who may otherwise have been shut out.

The five main changes, as summarized in the CPA Loan Portal-AICPA slide above (from this morning’s webinar), are in two different areas — “Focusing On Small Businesses” and “Increasing Program Access”, and are as follows:

  1. Starting Wednesday, a temporary pause in applications for 20+ employee businesses.
  2. New eligibility calculation rules for Schedule C self-employed (see below).
  3. Borrowers with non-fraud convictions will no longer be prevented from applying.
  4. Student loan delinquency will no longer prevent borrowers from applying.
  5. Clarify that ITIN applications for non-citizens will be accepted.

The biggest take-away for our client base is #2 above — this particular section of the White House statement:

Help sole proprietors, independent contractors, and self-employed individuals receive more financial support.
These types of businesses, which include home repair contractors, beauticians, and small independent retailers, make up a significant majority of all businesses. Of these businesses, those without employees are 70 percent owned by women and people of color. Yet many are structurally excluded from the PPP or were approved for as little as $1 because of how PPP loans are calculated. To address this problem, the Biden-Harris administration will revise the loan calculation formula for these applicants so that it offers more relief, and establish a $1 billion set aside for businesses in this category without employees located in low- and moderate-income (LMI) areas.

The SBA followed up with their own release shortly afterwards, stating, “The 14-day exclusivity period will start on Wednesday, February 24, 2021 at 9 am, while the other four changes will be implemented by the first week of March. The SBA is working on the program changes and will communicate details throughout this week.”

Therefore, self-employed taxpayers should wait until the new rules are released next week to apply for PPP funds.

What does this mean for applicants and their advisors?

PPP loans are based on wages to employees, which are subject to “payroll tax” (or “Social Security & Medicare taxes”). Whereas for certain types of one-person companies that don’t have payroll, the amount is calculated based on the net profit from IRS 1040 Schedule C — the amount on which “self-employment tax” is paid (also known as “Social Security & Medicare taxes”).

As CNBC reports, because of this method of defining “payroll” for the self-employed, some applicants saw very low loan amounts in previous rounds of the program, because they make very little in profit.

To “fix” the issue, the SBA is revising the formula to match what it uses for farmers. This basically means that they will calculate loan amounts from gross income instead of net profit.

This means that millions of small business owners who posted a loss in 2019 or 2020 will still be able to apply for PPP funds, based on their revenues before deductions are taken.

This sounds wonderful — and to some extent is — but it’s inherently unfair to partnership owners, who also have their PPP loans based on self-employment income. It’s also unfair to the millions of Schedule C filers who already applied for both rounds of the PPP without the benefit of this changed rule.

In a Forbes article from yesterday afternoon, Brian Thompson pointed out, “even more important is the question of whether this formula will be retroactive for those sole proprietors who have already applied. We don’t know yet whether these businesses will be allowed to gross up based on the new formula.”

As for small business advisors, it puts us back in a sprint again, during an already-grueling tax season. This morning, we developed our plan internally for next steps, which is to identify:

1) Clients who file Schedule C;
2) Who have not filed for PPP;
3) Because they have a loss or very low income on Line 31 of their 2019 Schedule C.

Then we’ll reach out to each one of them to explain that they may in fact be eligible for PPP after all, and to offer to prepare their application through our CPA Loan Portal, as we’ve been doing since early January for all our clients who qualify.

Although I am extremely grateful for this opportunity for small business owners, the inequity of the situation is extremely upsetting; we will see if additional changes are made that allow partnerships and prior applicants to use the same rules. But even if those concessions are made, there is an inherent issue with using gross revenues rather than net — which is that other types of single-member companies (S-corps, C-corps, Non-profits and Co-operatives) did not have the same option, and I know quite a few that suffered from lack of PPP funding as a result; even harder-hit were newer companies that did not show a 25% decrease from 2019 to 2020. (It’s hard not to go up from zero.)

I could go on, but I won’t, because it’s tax season and I have to take care of client deliverables in the midst of it all. Who knew that client financial relief would be such a moving target?

If this or any other posts on the website were useful to you, and your financial situation permits it, please consider contributing to my tip jar. This allows me to continue to provide free accounting resources to small businesses who do not have the funds available to hire a CPA.

COVID-19 Financial Relief, Education, Site News, Tips

Cómo Aplicar Un Préstamo Del Programa de Protección de Cheques de Pago (PPP) – GRATIS – En Español

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Explico el proceso para solicitar un préstamo del Programa de Protección de Cheques de Pago.

The webinar I gave last week on how to apply for a PPP loan was translated into Spanish by the talented Elsa Prado — just click the image above to hear the whole thing in Spanish.

She was also kind enough to invite me as a guest on her Spanish-language show Alas de Amor on Radio Dimension Latina FM last Saturday — and I managed to pull off most of it without resorting to English, though she was kind enough to expertly translate when I did. (Our session is from about 3:30-35:30 -ish.)

Alas de Amor on Radio Dimension Latina FM — https://fb.watch/3IztQD22aS/

Algunos aspectos destacados:

Estoy muy ansioso por difundir este importante programa de ayuda financiera para empresas pequeñas, se llama PPP. El Programa de Protección de Cheques de Pago (PPP) de la SBA se abrió para una otra ronda de solicitudes, hasta las 31 de marzo. Este programa proporciona a las pequeñas empresas fondos para costos de nómina, alquiler, servicios públicos y otras categorías nuevas de gastos adicionales.

Necesitas solicitar un préstamo PPP a través de un banco u otra institución financiera, no directamente a través de la SBA. Además, no tienes que solicitar el préstamo de tu banco principal. Hay muchos diferentes bancos, prestamistas y otras instituciones financieras que pueden ayudarle a presentar la solicitud.

En la primera ronda de préstamos PPP en abril de 2020, había muchos problemas con las aplicaciones. No había suficiente información sobre cómo presentar la solicitud y a veces había información contradictoria. Esto resultó en bastantes problemas para los negocios que trataron de solicitar préstamos PPP1.

Después de los desafíos de abril, la SBA publicó más información sobre cómo presentar una solicitud y el congreso presentó nueva legislación retroactiva que resolvió muchos de los problemas originales.

Las reglas ahora son más claras y beneficiosas para las pequeñas empresas.

La nueva ronda de préstamos PPP está abierta y la fecha límite para las solicitudes es el 31 de marzo. ¡Todavía hay tiempo para presentar su solicitud – incluso para la primera ronda de préstamos PPP!

If this or any other posts on the website were useful to you, and your financial situation permits it, please consider contributing to my tip jar. This allows me to continue to provide free accounting resources to small businesses who do not have the funds available to hire a CPA.

COVID-19 Financial Relief, Education, Illinois, IRS, Site News, Tips

How To Apply For The Paycheck Protection Program – FREE Step-By-Step Webinar With Slides & Links

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This past Wednesday, February 17th 2021, I was honored once again to participate in State Representative Will Guzzardi’s FREE Facebook Live series designed to help his constituents — and anyone else who wants to tune in — to learn about financial relief during Covid-19.

We did an entire hour-long session on how to determine eligibility and apply for the current round of the Paycheck Protection Program, which is designed to be open through March 31, 2021 or until funds run out.

The full-length webinar is FREE, as are the slides, resources and links to walk you through the application process. Additionally, a PDF version of the slides is available for download here:

Nancy-McClelland-CPA-PPP-Event-Slides-PDFDownload

We covered the following topics:
1) Paycheck Protection Program Summary
2) Current Program Overview
3) Eligibility
4) How To Apply
5) Where To Apply
6) Forgiveness Basics
7) Resources & Questions

Please share far and wide to help small business owners learn about the current status of the Paycheck Protection Program and how they can determine eligibility and apply for a non-taxable forgivable loan to help their companies stay afloat during these challenging times.

If this or any other posts on the website were useful to you, and your financial situation permits it, please consider contributing to my tip jar. This allows me to continue to provide free accounting resources to small businesses who do not have the funds available to hire a CPA.

COVID-19 Financial Relief, Education, Site News, Tips

The Dancing Accountant Presents: FREE PPP Webinar 2/17/21 6 PM Central

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I am proud to be participating in State Representative Will Guzzardi’s FREE Facebook Live series designed to help his constituents — and anyone else who wants to tune in — to learn about financial relief during Covid-19.

We’ll be doing a session on how to determine eligibility and apply for the current round of the Paycheck Protection Program, which is designed to be open through March 31, 2021 or until funds run out.

I’ll cover the following topics:
1) Paycheck Protection Program Summary
2) Current Program Overview
3) Eligibility
4) How To Apply
5) Where To Apply
6) Forgiveness Basics
7) Resources & Questions

Slides will be available through Rep. Guzzardi’s office by request, and I will link to a recording here on my blog.

As an exciting bonus, the webinar will be translated into Spanish, by the talented Elsa Prado. She was kind enough to invite me as a guest on her Spanish-language show Alas de Amor this past Saturday — and I managed to pull off about 85% of it without resorting to English, though she was kind enough to expertly translate when I did.

In either language, please join us to learn about the current status of the Paycheck Protection Program and how you can determine eligibility and apply for a non-taxable forgivable loan to help your business stay afloat during these challenging times.

If this or any other posts on the website were useful to you, and your financial situation permits it, please consider contributing to my tip jar. This allows me to continue to provide free accounting resources to small businesses who do not have the funds available to hire a CPA.

COVID-19 Financial Relief, Education, Illinois, Tips

PPP & Other Emergency Funding Opportunities – FREE BACP Webinar 1/19/21

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From the Chicago Department of Business Affairs & Consumer Protection:

The U.S. Small Business Administration (SBA) Paycheck Protection Program will support small businesses throughout the country with up to $284 billion toward job retention and certain other expenses. Businesses apply for PPP loans through a bank, credit union, community lender, online lender or other participating lenders. Please note that some lenders may not be participating in the program – please contact your preferred lender to determine if they are participating. Learn more at sba.gov/ppp and find a lender using the SBA Lender Match Tool.
While BACP does not manage the Paycheck Protection Program, we will be holding webinars and continuing to share information in the coming days and weeks.
The first webinar, “The Paycheck Protection Program and Other Emergency Funding Opportunities,” will be presented by the U.S. Small Business Administration and Accion Chicago on Tuesday, January 19, at 3:00 pm.Register and learn more at chicago.gov/businesseducation. More webinars will be planned in the coming weeks – stay tuned!
To learn more about the PPP, please visit these links:

If this or any other posts on the website were useful to you, and your financial situation permits it, please consider contributing to my tip jar. This allows me to continue to provide free accounting resources to small businesses who do not have the funds available to hire a CPA.

COVID-19 Financial Relief, Education, Software, Tips

PPP2 Opens Today 1/11 – But Only To A Few: Be Patient.

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January 11, 2021: The next round of the popular Paycheck Protection Program technically opens today — but only for a very small number of lenders, called Community Financial Institutions. According to CPA Practice Advisor, “To promote access to capital, initially only community financial institutions will be able to make First Draw PPP Loans on Monday, January 11, and Second Draw PPP Loans on Wednesday, January 13.  The PPP will open to all participating lenders shortly thereafter.”

In the finance industry, this is being referred to as the “Soft Launch” of the PPP. The reason for this tiered approach is that these institutions (CFIs), and the disadvantaged businesses they often represent — many of them from underserved communities — were mostly shut-out of the first round of PPP back in April. Brian Thompson published a great article in Forbes yesterday, explaining the details, that I encourage you to read. In short, the SBA is trying to equalize access to business ownership and support for black and brown communities. So if you’re not in one of these groups, today’s opening is not meant for you. Please be patient.

Although only this small group of lenders will be the included in the Soft Launch, unfortunately very few of them will be prepared to take full loan applications this week. These CFIs are generally only accepting applications from their existing customers, and do not have the processing capacity to receive an influx of applications, especially from those outside the communities they serve.

My recommendation is to continue with the strategy that you have already devised — whether that’s working with your existing banking relationship, or with your CPA to apply through a lending portal (I am using the CPA Business Funding Portal, a joint program between the AICPA and biz2credit — more here — you can also use the platform for free to help prepare applications to be sent to clients’ existing lenders).

See my recent blog posts for more information about the details of this round of the Paycheck Protection Program, or how to determine whether or not you qualify.

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