Payroll Protection Act

Was this employee retention credit something recently passed? Is this something we can handle at year end tax time or should we fill something else out?

You do it when you file your payroll tax returns. It was actually passed before this last bill. Just google "Employee Retention Credit". Here is the IRS link.

https://www.irs.gov/newsroom/irs-em...y-businesses-financially-impacted-by-covid-19

Here's an issue you're impacted by...Wells was in the soup with the Feds over privacy rights, had their wings clipped, and were against their risk ceiling with regards to collateralization and liquidity locks. Wells could not participate in the program given the structure of those penalties.

Feds recently were to lift that ceiling higher so that Wells could participate, but it put the institution behind the pace of the ramp up of all other lending banks. You're either going to need to revisit Wells to see if they are finally up and running in the program now, or you'll need to shop for an alternative lender who can assist you, wants your business.

Those who filed quickly are scheduled to be funded by as early as the end of this week. Yes, it's been slow, but Nancy cost us a week, and then the bureaucracy stepped in to assist with the feeling of our pain.

My company received PPP funding yesterday for 100% of our ask. It took less than 36 hours from application with Chase Bank to funding (over a 3 day banking holiday weekend!) Gives us some breathing room and keeps our staff fully employed.

That's terrific news. We were told to expect funding (or requirements for more data) within 10 days, distributions between 4/13-15 were anticipated. With any luck ours arrives quickly as well.

Correct insight as to the delay with Wells Fargo, they have a queue and are notifying me of my queue status every business day. No application yet though. I have noticed that other institutions that were, shall I say, easy to make application with got overwhelmed and have stopped taking applications.

Sounds like bad news. Alas, it is just news to me.

Here is what I mean.

Those who are getting funding must use that PPP monies very specifically to get foregiveness. This includes a time line of 8 weeks. So...once one is funded those funds must be used even if the business in not up and open and running. That, for us small operations, is a problem. Of course you can use the money anyway anytime if you want to convert is to a 1% 2 year note. Not bad either.

You have to rehire and employ the same FTE pre CARES Act and use the money even though your are still not generating revenue.

Tough times never last.

We applied early on but with our business bank, Wells Fargo. This was BEFORE they had problems with the loans.
Wells is pretty hard to get answers from.
We also applied for the SBA loan.
We get so many emails that seem sketchy that we are afraid to open them.
I can't tell if they are legitimate or not and have not opened any attachments yet.
There does not seem to be a way to confirm if we are in Que at WF.
We did get a confirmation # from SBA and you would think any Email from them would reference your Confirmation number right up front.

The latest Email from the SBA does not reference our Confirmation # which makes me think it's bogus & won't open it.

I know this is childish but I would really like to get one of the scammers that steal from people like this in a room.
Or take them on a nice fishing trip.......

A small suggestion for those applying for the PPP Program (as I did). I have separate savings, payroll and operating accounts. So, for each payroll I will transfer money from the SAVINGS ACCOUNT to the PAYROLL ACCOUNT, thus not commingling any funds with my OPERATING ACCOUNT. I use a payroll service, so there will be a recorded transaction of a withdrawal for payroll which will match the transfer showing the funds are used 100% for payroll. On top of that I will have an independent weekly payroll report from the payroll company. Even if you don't use a payroll company, your checks drawn on a separate payroll account along with taxes and other payroll expenses paid should match up. If you do not use a payroll service you can still do as written above to keep it clean. I feel by doing so you will have VERY CLEAN records for transparency when it comes time to show how the money was used and then getting the loan forgiven. Just a thought IMHO.

Agreed, clean. Set up at minimum a new account specific to these funds and only use them for payroll. We'll execute checks from our payroll account, proffer ourselves a payroll report for that funding, and then we'll move the exact value of that payroll account from this PPP account to cover the payroll. The payroll report and account transfer will serve as the documentation for the funds as they are used, accounting for every penny, and only using the funds for payroll as to not rock the boat with other transactions that require explanation. I don't want to be on the wrong side of the razor's edge when it comes to repayment versus forgiveness.

Just flipped on MSNBC to hear charter yacht owners specifically singled out for extra scrutiny in a call out to Congress to tighten up the PPP lending protocols, comparing them to the bankers in 2008. 'People who own yachts and planes and charter them out 3 times a year have the resources in their regular businesses to get this money to pay their crews, but the small business owner who has say a nail salon can't, and the PPP money will run out before they can.'

Gratitude and rtrafford, thank you both for those last 2 posts. If I get approved I was wondering about setting up a separate account so as to not have any trouble proving where the money went. It is a little bit of pain for me as the one business that applied does not have a payroll account, but none the less you 2 confirmed my thoughts. I am not sure I will take the money as I am hearing the rules of forgiveness have not been established and as I am sure you both do I will be reading the contract thoroughly and will go from there.

I set up a unique account for the PPP. The only funding in is from PPP. The only funding out will match the payroll reporting, precisely. I will not use these funds for rent, utilities, insurance, strippers. I don't want to mess with any fine lines of forgiveness. But worse case (I think) is that it turns out to somehow be a loan that must be repaid, one which has very low interest.

MYL. I was weary as well of the possibilities of the loan not being forgiven. So I spoke with my accountant and my banker on this and the rules are pretty specific. You just need to understand them as it apples to your business and follow them. Good luck. PS. As a precaution, I will be looking to accumulate and build up my capital reserves until such time I receive a letter making the forgiveness official.

Just read this:
(CNN)The money is gone.
On Thursday morning, the $349 billion emergency small business lending program officially tapped out. The Small Business Association officially ran out of money for the Paycheck Protection Program, according to a message for lenders posted on the administration's website.
Negotiations on Capitol Hill have yet to generate a path forward to replenish the money, all as the US economy continues to stagger under the pressure of near-nationwide closures.

The next bill is moving very slowly as did the ones to date and implementation then takes ages after. This bill has helped a lot of small businesses and their employees but so much more needed.

At some point we should have decided do we want to force employers to keep paying or funnel everyone through unemployment. Then design a system around that. If you want employers to pay then just provide the funds to do so. PPP sure helps some, but it doesn't help any large employers so does nothing for the vast majority of employees. Large employers then forced to lay them off and still have no help with any other expenses. Nor does the small employer get much help with rent and other things.

Now, fortunately, I've found most commercial landlords very accommodating and willing to negotiate. Here's a form and outline I'd suggest using with your landlord if you haven't worked anything out. This is commercial only.

https://centerforrisc.org/lease

It's from the University of Chicago Center for Radical Innovation for Social Change.

I know of only one owner of malls not negotiating and we encountered only one smaller landlord or local REIT refusing to do so. Subsequently they received our notification of intent to vacate in a few months and not to exercise our lease option. They then wanted to negotiate and we told them it was too late, we'd already agreed to a lease across the street.

Meanwhile with PPP not available to large employers, nearly all are laying employees off to go onto unemployment.

Thought the small business PPP was providing some funds for rent and miscellaneous. Seems practical to handle the this issue in one program along with payroll. As a landlord you would have to handle each tenant separately, specifically if the tenant has the ability to survive for the duration of the lease modification. The landlord is becoming a banker under the terms in the lease modification. We have some good tenants that are unlikely to survive 3 months much less a year, and going to court for collection is not an option. We just learned two tenants are not going to pay rent until they are approved for PPP, which may not happen. Very tough decisions to make.