JohnH

Sometimes it's hard for a person to understand something when they think their best interests may be served by not understanding it.

Bonuses might be a good solution if there aren't any restrictions in the final qualifications. Not to work against the interests of the employees, but is it a better business practice to give away money if one would not have otherwise done so, or to spend the $ on other expenses which do not qualify for forgiveness and just allow that portion to convert to a 1% loan? (After meeting the 75% standard, of course). Presumably a business applying for the PPP is in need of cash - can't afford to spend it needlessly. This PPP presents some very unusual decision-making scenarios.

Just make sure you have him locked down with multiple disclosures so if he gets audited he can't try to point the responsibility finger back at you. You know he will.

I haven't been following much of this, but I'll just say I'll be happy with the loan forgiveness, no matter how the rest of it sorts out. Personally I think as a matter of fairness, free money would override & exclude the use of any other tax benefit regarding that particular expenditure, but maybe I'm missing something in the conversation.

Several people on an investing forum I participate in have been posting that they filed paper returns within the past few weeks, and of course nothing is happening since IRS isn't processing those returns now. So what would happen if the taxpayer e-filed a return now? Presumably it would have processed and the refund would have been issued by the time the IRS gets around to processing the paper return. Would the taxpayer be in any sort of trouble in that situation? IRS should create a check box to enable those e-flinging their return to notify them that it is intended to replace a previously paper-filed return. That would clear things up considerably, although I don't know how many taxpayers might potentially be involved.

Just coming back to support what others are reporting now. This same client went back in this morning and completed the process of entering their bank account information. They first entered the '0" and didn't check either button. That did not work. Then they chose the "Refund" button and entered "0" as the amount. It worked fine. One thing I will mention for clients who aren't able to get past the first screen. The abbreviations for "Street", "Circle", "Boulevard", "Drive" , etc must conform to the USPS guidelines. That's true even if the original return used them incorrectly. So anyone who keeps failing the initial screen should jump over to the USPS Zip code lookup and verify that the address they are entering conforms to those guidelines.

Thanks Rita. I'd say more but I'm tied up all day and am unable to type anything else.

I just now helped a client who had a zero figure. My experience was the same as Judy's - we could not get it to authenticate no matter what we tried.

Anybody care to critique my answer to a Schedule C client who left me a long voice mail this morning? ===========• Hi Xxxx: I heard your voice mail. I am tied up all day and unable to return phone calls. I don’t know anything about what you described. That info will need to come from someone more familiar with the process. The only thing I’ve done is advise a couple of corporate clients on what to enter on their applications. The corporation questions are very precise so there’s no interpretation or guessing about what to enter. It sounds as though the sole proprietor information is specific to sole proprietorships and/or allows for some interpretation. I’m avoiding SBA loan applications for the simple reason I don’t know their special rules and lingo. But I do know they have the power to make life very unpleasant for accountants who offer advice about their procedures when they haven’t been trained. So I’m declining involvement in anything having to do with these loans. Lending really isn’t tax related anyhow. Sorry I can’t be of any help on this. ============ Yes, I’ll likely lose a client over this, but at this point in my life that isn’t a consideration.

Sure enough, the Advance EIDL deposit (a whopping $1,000 per employee) showed up in my business bank account at 7:00 am today (Apr 20). It was not there on Saturday or Sunday. So this at least confirms that when SBA announced on Thursday they were out of funds, they really meant all the money was "encumbered" but not all was "disbursed". Or maybe the scenarios Medlin suggested are impacting what's happening now.

The EIDL arrived. I applied March 30 listing two employees. Nothing happened until this weekend when I was notified by my credit monitoring service of someone having run a credit inquiry on me. When I took a look, the credit inquiry had been run by the SBA. This morning (April 20) a $2,000 deposit is showing in my business bank account. So I guess the SBA decided 3 weeks was close enough to 3 days when it’s government involved. The good news for some of your clients is that the SBA funding may yet arrive even though they ran out of money last Thursday and no new legislation has yet passed.

I definitely agree with Lion regarding using a separate account. There's too much at stake not to have a solid audit trail for the transactions and proof positive that there was no commingling of funds (by any bureaucratic definition).

Just an FYI. I applied for the EIDL on May 31 and the PPP on April 14. This afternoon (Saturday, Apr 18) my credit monitoring service sent an alert that there had been an inquiry on my credit file. Turns out the inquiry was by the SBA. I've heard from several places that the SBA runs a credit check on owners before depositing EIDL funds. The purpose is not to obtain credit scores, but simply to verify that the owner exists and has submitted truthful information. So this COULD mean that although the initial funds are exhausted, there may be some residual distributions of funds which were committed but not yet disbursed. If my speculation is right, this might be an encouragement to anyone who has applied but has not yet received any funding from EIDL or PPP. (I thought about waiting until the next couple of business days to post this after I had either received a deposit or not, but decided I might forget the time line by then)

Just imagine the scenario if you turned them in and some sort of investigation ensues. They would likely tell IRS that you had been advising them on how to game the system and then turned them in out of spite when they refused to pay you an exorbitant fee. Or something along those lines.

I exceeded the number of tries because I was getting the dreaded "We Don't Know You" reply, and it locked me out for 24 hours. (But it never told me how many tries were too many). Tomorrow I'll start counting.

I saw an article yesterday that PayPal, QuickBooks, and Square are getting SBA authorization to process PPP loan applications. If they are successful and efficient, seems to me this would be a great resource for small businesses and self-employed. These companies have a vested interest in helping truly small businesses and mom & pop shops continue to operate, so they might be more responsive than big banks. Here's a link to one article: https://www.bizjournals.com/sanjose/news/2020/04/13/paypal-intuit-paycheck-protection-program.html

Thanks for the correction. I definitely missed that. I should have re-read the legislation before posting.

Well, SBA finally clarified their emergency EIDL with this missive today. The rumors are correct - they're providing $1,000 per employee, even though the legislation says nothing about this limitation. ===================================================== Dear Applicant, On March 29, 2020, following the passage of the CARES Act, the SBA provided small business owners and non-profits impacted by COVID-19 with the opportunity to obtain up to a $10,000 Advance on their Economic Injury Disaster Loan (EIDL). The Advance is available as part of the full EIDL application and will be transferred into the account you provide shortly after your application is submitted. To ensure that the greatest number of applicants can receive assistance during this challenging time, the amount of your Advance will be determined by the number of your pre-disaster (i.e., as of January 31, 2020) employees. The Advance will provide $1,000 per employee up to a maximum of $10,000. You may be eligible for another loan program, the Paycheck Protection Program, which is available through participating lenders. Below is a comparison of the two loan programs: ====================================================

Ron: I know you wanted a no-cost option, but nevertheless you might want to consider Tax941 from Time Value Software. The cost is $170, and it is a simple 941 generator. It stores all the client detail, so each quarter you just call up the current quarter form and enter the numbers. It prepares Schedule B (if required) and will do penalty calculations if the client is late with a FTD. It also updates the form if/when there are changes, which there will be in the next quarter. It's very efficient and well worth the cost, IMO. https://www.timevalue.com/tax941

Did anyone give you this link? https://www.irs.gov/pub/irs-pdf/f941.pdf

Since the April 15, 2020 filing date has been extended to July 15, 2020, how does this affect Form 4868 filings? Is the extended due date still Oct 15, 2020, or is it pushed out to Jan 15, 2021?

Thanks for the link,. If anybody calls me, I'll just text to email the link to them.

It has been my understanding that applying for this special $10K EIDL does not prohibit applying for the PPP. As a matter of fact, the assumption is that the employer will apply for the PPP and the $10K EIDL advance will just be deducted from the amount ultimately approved in the PPP. But I could be mistaken. My next comment is not mistaken: The 3-day window for the EIDL was either a come-on, an impossible administrative standard, or is subject to a few hidden definitions & conditions which were kept carefully hidden behind the curtain. The lack of clarity, coupled with what many applicants are now viewing as essentially another broken promise, is not creating any confidence. If it turns out that the "up to $10K" actually results in a pittance of $1K per employee, I think many very small mom & pop operators will simply regard it as a very bad joke played on them by cynical, disinterested bureaucrats and politicians. Nothing more than a blast of hot air designed to grab a few headlines. In other words, business as usual in government.

I am monitoring about a dozen applications for the "up to $10K" EIDL request. Most were submitted on or before March 31, 20120. As of today (April 8), not a single one of them has received a deposit into their checking account.

I haven't charged any of my clients for helping with the short form application. I just want to do what I can to help them stay in business. The income stream from not losing them due to business failure is worth a lot more than a few $ in the present. I consider the time to be an investment in their future and mine (or the tax preparer I hand them off to when I retire). They will have to prepare more detailed financials when the actual loan process starts and that will be the time to discuss fees. Personal experience - this evening I was speaking with my daughter and her husband on my way home from work. I mentioned the EIDL in passing during our conversation. She had to cut the conversation short because an HVAC repair guy had dropped by to pick up his check for some work he had done for them. A short while later she called to ask if i minded giving some details about the EIDL program because the HVAC guy had just told them he wasn't sure his business is going to survive this situation. She put him on the phone and I spent about 30 minutes explaining some aspects of the program and telling him exactly what he needs to do AS SOON AS HE GETS IN FRONT OF A COMPUTER. Then I ate my dinner which by now was getting a little cold. No charge for the advice, but maybe he and 5 or 6 of his employees may continue to have jobs that would have disappeared in the next few weeks. That's worth more to me than a processing fee. But if I were seeking clients, I'm betting I'd have a pretty good chance of stealing his business from his current accountant.