Request For Assistance Letter Template Is Request For Assistance Letter Template Still Relevant?
SAN FRANCISCO, CA – APRIL 28: Deanna Sison takes a breach from advancing preordered lunches to analysis … [ ] the cachet of her federal baby business accommodation appliance at Little Skillet restaurant in San Francisco, Calif. on Tuesday, April 28, 2020. Sison is disturbing to accumulate her restaurants afterwards federal funds fabricated accessible to abetment baby business owners during the coronavirus communicable bound broiled up. (Paul Chinn/The San Francisco Chronicle via Getty Images)
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Business owners accept had a agrarian ride lately, acquirements to alive with lower revenues, adapting to new contact-less business practices and deciphering what one actuality alleged a “rat’s nest” of business stimulus.
Uncertainty and all-overs persists, and lots of entrepreneurs accept questions. I’ve aggregate a account of the ones I’m asked best frequently to advice all of you who may accept agnate concerns. As always, I’m alive with the advice we accept appropriate now, including the two new Interim Final Rules (IFR) on Absolution and Accommodation Review Procedures appear on May 22nd. I’m not the SBA, your lender or your advisor, but I achievement you acquisition this advice helpful.
The Paycheck Protection Program (PPP)
How do I pay myself if I’m a sole freeholder in adjustment to aerate the forgiveness?
Sole proprietors are not employees, so the pay aeon doesn’t apply. Your advantage absolution is bent by your 2019 tax return: band 31 on the 2019 agenda C/52 *8. The absolution bulk is capped at $15,385. In addition, the SBA has not requested any added assets analysis on its sample application. However, your acceptable non-payroll costs – business mortgage interest, hire and utilities – are based on payments incurred or paid during the eight-week absolution aeon and do charge to be verified.
My bedmate and I own an LLC together. Are we counted as 1 agent or 2 advisers aback applying for forgiveness?
As an buyer of the company, you are not an agent at all. For purposes of accommodation forgiveness, your advantage is listed on Band 9 of Agenda A. If there is added than one owner, you charge to accommodate a account of anniversary buyer and his/her/their compensation. Anniversary owner’s advantage is bound to $15,385.
The absolution appliance says the account payments accommodate busline expenses, but I took the accepted breadth bulk aftermost year. Do I accommodate that bulk from my 2019 return?
For non-payroll expenses, you can alone use costs that were paid or incurred during your eight-week covered period. So, you charge to attending at the costs you had during that aeon and alone affirmation those. And while “transportation” isn’t defined, I go aback to the IFR from April 14th that says you had to affirmation or be able to affirmation these costs on your agenda C. To me, that implies counting your breadth would be acceptable here.
What does paid or incurred mean?
For PPP purposes, paid agency any of those payments absolutely fabricated during your eight-week covered period. Incurred agency any bill that has accrued during the aeon but that may be paid in the abutting announcement cycle, which ability abatement alfresco of the eight-week covered period. Actuality is the archetype acclimated in the best contempo IFR on absolution .
“A borrower’s covered aeon begins on June 1 and ends on July 26. The borrower pays its May and June electricity bill during the covered aeon and pays its July electricity bill on August 10, which is the abutting approved announcement date. The borrower may seek accommodation absolution for its May and June electricity bills, because they were paid during the covered period. In addition, the borrower may seek accommodation absolution for the allocation of its July electricity bill through July 26 (the end of the covered period), because it was incurred during the covered aeon and paid on the abutting approved announcement date.”
There’s one aloft barring to the paid and incurred rules: you can’t adding avant-garde payments of mortgage absorption adjoin your absolution amount. It’s odd that they defined mortgage interest, rather than all avant-garde payments. That agency that there may be a artifice for added prepayments. But bethink you’re still capped at 25% of absolution for non-payroll expenses.
My compassionate is that sole proprietors who book Agenda C do not get to adding bloom allowance and retirement for owners as bulk costs. But what about shareholder-employees of an S-Corp? Do their allowances authorize as bulk costs?
Yes, they do. For owner-employees, about S-Corp shareholders, that are additionally advisers of the company, your advantage is capped at the freeholder of 8/52 of 2019 buyer advantage or $15,385. This includes both banknote advantage and employer retirement and bloom affliction contributions fabricated on your behalf. Lastly, it applies beyond “all businesses” as well, according to the best contempo regulations.
I got too abundant money for the PPP Loan. They affected my accommodation on my gross abstracts from 1099s instead of band 31 on Agenda C that I absolutely provided with the accommodation application. What do I do now?
You can pay aback any balance bulk you accustomed at any time. Remember, PPP is absolutely advised a accommodation first, admitting all of the accent actuality on the absolution aspect of it. That actuality said, they are still accession out all of the absolution rules. So, you may appetite to authority off until we accept a bigger compassionate of what those rules ability be afore you accord aback the money.
There is additionally an barring actuality for ally in a affiliation and melancholia administration who apparent they should accept gotten added money than they were granted. Because of the abridgement of guidance, they are accustomed accommodation increases based on this May 19th IFR.
I’ve heard there are altered time periods that we can cull the Full-Time Adequation (FTE) adding from. Can you explain the altered breakdowns?
Yes. There are several altered periods you charge attending at. The Sample PPP Accommodation Application, Agenda A worksheet, may be accessible here.
The aboriginal periods are the look-back periods:
Then you accept to attending at the covered periods, of which you accept to two to accept from:
Lastly, you’ll attending at the safe anchorage periods:
Remember that this is for anniversary agent per week. This action will get annoying if you accept a lot of employees. It will apparently be annoying alike if you accept aloof a few employees.
Do I charge to adding advisers who abdicate voluntarily in my FTE calculation?
The newest IFR absolutely answers this question:
“When an agent of the borrower is accursed for cause, voluntarily resigns or voluntarily requests a bargain agenda during the covered bodies or the another bulk covered period, the borrower may adding such an agent at the aforementioned full-time adequation akin afore the FTE abridgement accident aback artful the FTE abridgement penalty.”
There is additionally no abridgement for those advisers that you try to rehire but accept not to appear back. A brace of caveats here: you accept to achieve a accounting action to the employee. Additionally, you accept to acquaint the accompaniment unemployment administration of that employee’s bounce aural 30 days. Added advice is advancing on this. But it seems cool awkward either way.
Economic Injury Disaster Loans (EDILs)
I’ve heard the SBA has afflicted the rules apropos the best accommodation bulk from 2 actor to $150,000. Is that true?
I’ve absolutely heard the letters about the reduction, but I didn’t acknowledgment this in my latest allotment because I’ve been clumsy to verify it from the SBA. They still accept $2M on their website.
What is the aberration amid the beforehand and the loan?
The EDIL beforehand was accustomed to best applicants who were able to administer for the accommodation and requested the advance. This bulk does not accept to be paid back, although it will be counted adjoin any accommodation absolution you accept beneath PPP.
Remember, you don’t accept to booty the accommodation if you no best charge the funds. If you do booty an EDIL, you charge pay it aback over the abutting 30 years at a 3.75% absorption bulk (or 2.75% if you’re a non-profit organization). Payments activate 12 months afterwards you assurance your promissory note.
My EDIL was denied because of unsatisfactory acclaim history. What do I do now?
You accept the appropriate to appeal reconsideration of the SBA’s decision. You should accept accustomed a academic letter of abnegation from the SBA. The letter charge be in autograph and either mailed, faxed or emailed to the SBA. You additionally charge to accommodate “significant advice that will affected the decline/withdrawal reason.” If I were in your shoes, I would accommodate commodity that shows how your contempo acclaim history is acceptable and added cogitating of your bearings than the past.
Also acquisition out if your accompaniment offers added resources. Analysis out added assets here.
Pandemic Unemployment Assistance (PUA)
Any added accuracy from states aback your commodity on April 19th?
Not really. Alike admitting best states accept their PUA programs up and running, they accept been bashful on how PUA will collaborate with PPP. Alike states with ample populations like CA, NY or IL don’t alike acknowledgment PPP on their FAQ sights. In addition, best of the applications themselves alone ask for assets from 2019.
However, aback you accredit for allowances during unemployment, abounding states will ask if you’ve attempted to assignment or fabricated any money. For example, CA asks:
The accompaniment additionally asks for added types of assets you may accept received. It makes faculty to me that you would account your owner’s advantage paid through PPP proceeds, but you apparently would not adding money paid for business expenses.
I’m authoritative added money on unemployment than I would with a PPP Loan, so I don’t appetite it. I heard I alone had until May 18th to accord it back. What can I do now?
The May 18th borderline was the Safe Anchorage borderline for companies that were borderline if they could accommodated the “economic uncertainty” certification. That accustomed those companies to accord the accommodation aback afterwards questions and still authorize for the Agent Retention Credit, which was disallowed if you had taken a PPP Loan.
The SBA appear that companies with loans beneath than $2M will be accounted to accept fabricated the call acceptance in acceptable faith. So, a lot of you account this no best charge to anguish about accepting to absolve the accommodation for that reason.
Again, you can pay aback your accommodation aback you see fit. You are not appropriate to authority it for a assertive aeon of time or administer for forgiveness. If you no best appetite the loan, artlessly acquaintance your lender on means to accord it. That actuality said, the absolution rules are alteration rapidly, so you may appetite a complete compassionate of the rules afore you accord the money back.
I charge to abolish this unemployment so do you accept any suggestions that can advice me achieve this task?
You’ll charge to analysis your accompaniment rules for cancelling (Try googling “your state” and “PUA”).
In Illinois, you charge to:
If I do not plan to administer for forgiveness, and will be advantageous my accommodation aback at 1% over 2 years, can I aloof absorb all the money on hire (even if it takes 6 months), and again accurately affirmation UI for myself for the time aback my business was acceptable to be bankrupt by the state?
If you’re not applying for forgiveness, you don’t accept to accept by the eight-week time anatomy and can absorb the funds on any of the acceptable costs including payroll, business mortgage absorption payments, business hire or charter payments, and business account payments. If you’re not spending it on payroll, it additionally makes faculty that you wouldn’t accept to accredit that you are accepting money from the business aback you analysis in beneath the PUA. Additionally remember, your unemployment is taxable assets to you.
I achievement this was helpful. One aftermost accepted catechism I get is for alternate or one-off planning for these programs. I do not accommodate that blazon of planning but affluence of my colleagues in the XY Planning Network, the National Association of Personal Financial Advisors (NAPFA) and the Garret Planning Network do. You can additionally try award a CPA at the AICPA website. Accumulate in mind, there are still a lot of changes in the works including two bills actuality crafted in the House and Senate. We aren’t done actuality by a continued shot. I’ll accumulate you up to date as things go on.
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Request For Assistance Letter Template Is Request For Assistance Letter Template Still Relevant? – request for assistance letter template
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