SBA Loans

[ILLMAS]

Has anybody else been contacted to help their clients apply for an SBA loan?  Two of my clients have reached out for help them, and I am wondering if it’s worth offering it as a service.  

[Lion EA]

I don't have the time. But, if you could study the SBA literature and work your way through one, you could probably do lots more, lots more quickly.

I did have one biz client message me this morning for Feb 2019 thru Jan 2020 income, payroll, and utilities to fill out an application with his banker.

[ILLMAS]

Same here, I am busy getting work out.  I will send them to their bank for help.

Thanks

[Lee B]

I was reading on one site today, that you cannot obtain a forgiveable SBA loan and also claim a payroll tax credit.

[Lynn EA USTCP in Louisiana]

I completed the SBA loan application middle of the night last night . It was a very quick process . 

[ILLMAS]

5 minutes ago, Lynn EA USTCP in Louisiana said:

I completed the SBA loan application middle of the night last night . It was a very quick process . 

Was this for a client or for your business?  If you can share your experience.

Thanks

[Abby Normal]

Here's the link if you want to share it with your clients:

https://covid19relief.sba.gov/#/

[JohnH]

The EIDL loans are going to be a HUGE benefit to many small business clients.  I spent most of today coordinating among 4 clients as we learned about the process.  Part of this program provides significant financial assistance which is initially a loan but much of it is forgivable (essentially converting it into a grant). I suspect many accountants and tax preparers may also benefit greatly from this program.  

Abby Normal just provided the link in the previous post.  Take a look at it and you'll probably conclude that many of your clients need to be on this right now.  The banks are useless at this point, but the simple 4-page application enables the client to get into the queue and possibly gets them a $10,000 grant right out of the box regardless of creditworthiness.  (I know, it seems too good to be true but these are unusual times). 

This program undoubtedly will be abused by some, but it has the potential to stave of many small business bankruptcies and facilitate a faster recovery. I predict you'll gain the undying gratitude of some clients by simply directing them to this site.

 

[Abby Normal]

3 hours ago, cbslee said:

I was reading on one site today, that you cannot obtain a forgiveable SBA loan and also claim a payroll tax credit.

You can't use the same wages to both get loan forgiveness and get reimbursed with tax credits. That would be double dipping. I mean, that only makes sense.

[JohnH]

Agree with Abby Normal.  If you lend me the money to pay my employees, then forgive the loan to the extent I actually pay them, I'll take that option over a tax credit every single time. 

 

[Lynn EA USTCP in Louisiana]

ILLMAS, I submitted the application for my own business.  

[JohnH]

I did the same. I operate  a separate business (S-Corp) which is totally unrelated to accounting and tax work. I applied for an EIDL loan for that business yesterday. 
 

After going through the process and reading some of the details, I’m suggesting to almost all my clients that they should apply. 

[Lee B]

I just filled out the application for my own business in about 20 minutes, did not ask for the $10,000 grant advance.

[Lee B]

20 hours ago, ILLMAS said:

Has anybody else been contacted to help their clients apply for an SBA loan?  Two of my clients have reached out for help them, and I am wondering if it’s worth offering it as a service.  

It's pretty simple, if you have the time.

[ILLMAS]

1 hour ago, cbslee said:

It's pretty simple, if you have the time.

I just helped out a client via team viewer 15-20 min to complete.

[Texas Booster]

New from the Treasury:

Small business start applying on April 3, sole proprietors on April 10.

 

 

[Ram32]

Great discussion as usual. I too, see a value in knowing how to walk a clients thru this plus it sounds like our own businesses might benefit.

[jklcpa]

45 minutes ago, Texas Booster said:

New from the Treasury:

Small business start applying on April 3, sole proprietors on April 10.

Hi Texas, are you in the business of tax preparation or related industry?

Do you have a cite?

[Texas Booster]

Yes, I am getting my EA, and am proficient in farms, small businesses and trucking. Still have a lot to learn.

I got it from a PwC conference call today at about the Covid tax updates. I will track it down tonight once my phone stops ringing.

TB

[Medlin Software, Dennis]

For me, I can be certain of my numbers, so it was easy to see the PPP process is most beneficial for me.  For others, maybe it is the retention credit or something else.

[Lee B]

5 hours ago, Texas Booster said:

New from the Treasury:

Small business start applying on April 3, sole proprietors on April 10.

 

 

These dates are for a program called the "Paycheck Protection Program."

[Lee B]

I started a new thread about the "Payroll Protection Program" which is a different program with a different application process.

It's getting hard to keep track of all the moving parts of the different programs.

[Lee B]

 

Here are summaries of the two programs:

*  Paycheck Protection Program

The Paycheck Protection Program prioritizes millions of Americans employed by small businesses by authorizing up to $349 billion toward job retention and certain other expenses.

Small businesses and eligible nonprofit organizations, Veterans organizations, and Tribal businesses described in the Small Business Act, as well as individuals who are self-employed or are independent contractors, are eligible if they also meet program size standards.

Under this program:

Eligible recipients may qualify for a loan up to $10 million determined by 8 weeks of prior average payroll plus an additional 25% of that amount.

Loan payments will be deferred for six months.

If you maintain your workforce, SBA will forgive the portion of the loan proceeds that are used to cover the first 8 weeks of payroll and certain other expenses following loan origination.

 

*  Economic Injury Disaster Loans and Loan Advance

To apply for a COVID-19 Economic Injury Disaster Loan, click here.

In response to the Coronavirus (COVID-19) pandemic, small business owners in all U.S. states, Washington D.C., and territories are eligible to apply for an Economic Injury Disaster Loan advance of up to $10,000.

The SBA’s Economic Injury Disaster Loan program provides small businesses with working capital loans of up to $2 million that can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing. The loan advance will provide economic relief to businesses that are currently experiencing a temporary loss of revenue. Funds will be made available within three days of a successful application, and this loan advance will not have to be repaid.