PPP Loan

[usurpers26 26]

Just curious if any other small business owners took advantage of the PPP?  If so, what's your status?

We are getting our funds wired tomorrow....the process was actually painless.  We did use the same lender we have an existing loan with.  Now let's see if it gets forgiven (80% of the funds will be for payroll, 9 employees).

[Hawkeye21 1,848]

We took advantage of it.  In fact, we just got notified that we were approved today.  The process was pretty easy and didn't take long.  We did have to wait about a week for our bank to get prepared for it.  It didn't seem like they knew much when it was first announced.

[usurpers26 26]

4 minutes ago, Hawkeye21 said:

We took advantage of it.  In fact, we just got notified that we were approved today.  The process was pretty easy and didn't take long.  We did have to wait about a week for our bank to get prepared for it.  It didn't seem like they knew much when it was first announced.

I am not so sure they know much now either - our closing docs noted in bold that the Feds have yet to provide lenders guidelines on the forgiveness part... 

[Hawkeye21 1,848]

1 minute ago, usurpers26 said:

I am not so sure they know much now either - our closing docs noted in bold that the Feds have yet to provide lenders guidelines on the forgiveness part... 

I'm not exactly sure how it's all going to work either.  We were told by our financial adviser to take advantage of it so we did.  It looks like if we do have to pay it back it will be at 1% interest from my understanding.

[Gladiators 1,903]

We sent in all the supporting documents on 4/3.  We received a loan confirmation on 4/9.  We should be receiving loan docs later this week and will receive funds within 24 hours of executing the loan documents.

[cmh6476 748]

I am, but can't say it necessarily feels right because likely wouldn't have laid anyone off regardless.

[Hawkeye21 1,848]

Just now, cmh6476 said:

I am, but can't say it necessarily feels right because likely wouldn't have laid anyone off regardless.

We didn't really feel right about it either because our business is doing just fine right now.  We were advised to do it though.  If we do have employees get sick and have to shut down it will be nice knowing we have this to help pay them all though.

[usurpers26 26]

4 minutes ago, Hawkeye21 said:

I'm not exactly sure how it's all going to work either.  We were told by our financial adviser to take advantage of it so we did.  It looks like if we do have to pay it back it will be at 1% interest from my understanding.

Correct, 1% over 24 months - 6 month deferment.

[Gladiators 1,903]

Just now, Hawkeye21 said:

We didn't really feel right about it either because our business is doing just fine right now.  We were advised to do it though.  If we do have employees get sick and have to shut down it will be nice knowing we have this to help pay them all though.

I felt the same way initially.  Then a couple jobs were shut down and I thought about the fact that my industry lags manufacturing...We don't need the cash today, but it's possible we may need it in 9 months.

[frank 2,144]

You down with PPP? 

[edjr 5,547]

I will PP on you for free

[Hawkeye21 1,848]

7 minutes ago, usurpers26 said:

Correct, 1% over 24 months - 6 month deferment.

May be 100% forgiven though, correct?

[Gladiators 1,903]

2 minutes ago, Hawkeye21 said:

May be 100% forgiven though, correct?

Yes

[NorthernVike 2,079]

12 minutes ago, cmh6476 said:

I am, but can't say it necessarily feels right because likely wouldn't have laid anyone off regardless.

This is where I'm at.  My income will be effected but to the extent that I need a handout, doubtful.  

[usurpers26 26]

8 minutes ago, cmh6476 said:

I am, but can't say it necessarily feels right because likely wouldn't have laid anyone off regardless.

With the amount of taxes we pay, I felt bad about it for a minute.  

[usurpers26 26]

3 minutes ago, Hawkeye21 said:

May be 100% forgiven though, correct?

As long as at least 75% of the funds go to payroll expenses.

[Hawkeye21 1,848]

Just now, usurpers26 said:

With the amount of taxes we pay, I felt bad about it for a minute.  

That's why I took the word from our adviser.  May me feel better about it.

[jerryskids 5,169]

23 minutes ago, frank said:

You down with PPP? 

Yeah, you know me!

[Alias Detective 1,179]

27 minutes ago, NorthernVike said:

This is where I'm at.  My income will be effected but to the extent that I need a handout, doubtful.  

I know your business.  What is one of the first bills people tend to skip paying?

 

[josh wiley 27]

2 hours ago, frank said:

You down with PPP? 

good one frank.  didn't realize it but i needed that good laugh

[vuduchile 1,940]

No.  My crews are all 1099 contractors, so they’re not on payroll.  
 

Still working with landlord to forgive some or all of my rent for whatever time period we’re shut down   

I applied for the $10K EIDL advance.   Also filed for unemployment Sat when they opened that up to self-employed people.  
 

Haven’t seen money from either source yet.   

[usurpers26 26]

13 hours ago, vuduchile said:

No.  My crews are all 1099 contractors, so they’re not on payroll.  
 

Still working with landlord to forgive some or all of my rent for whatever time period we’re shut down   

I applied for the $10K EIDL advance.   Also filed for unemployment Sat when they opened that up to self-employed people.  
 

Haven’t seen money from either source yet.   

You can include 1099s in PPP.

[Alias Detective 1,179]

8 minutes ago, usurpers26 said:

You can include 1099s in PPP.

 I don’t think if ones sole income is from 1099’s

i’m an independent contractor in the financial industry.  I’m unable to conduct ANY face to face meetings and my practice has suffered somewhat.  I applied Friday when independent contractors could apply.  We shall see what comes of it.

[usurpers26 26]

1 minute ago, Alias Detective said:

 I don’t think if ones sole income is from 1099’s

i’m an independent contractor in the financial industry.  I’m unable to conduct ANY face to face meetings and my practice has suffered somewhat.  I applied Friday when independent contractors could apply.  We shall see what comes of it.

The "rules" from the lenders on how to calculate average monthly salary:

"(bb) the sum of payments of any compensation to or income of a sole proprietor or independent contractor that is a wage, commission, income, net earnings from self-employment, or similar compensation..."

So not only does it cover 1099's, it covers GPs to members.  The cap is 100k per person.  As long as you have documentation you should get approved.

[Alias Detective 1,179]

As in Indy contractor I file on my own.  I don’t have my broker file on my behalf.  They can’t.  I’m an independent contractor.

 

Viduchili can’t get a ppp loan to keep “his” crews.  The crews can get the ppp on their own tho.

Right?

 

[usurpers26 26]

3 minutes ago, Alias Detective said:

As in Indy contractor I file on my own.  I don’t have my broker file on my behalf.  They can’t.  I’m an independent contractor.

 

Viduchili can’t get a ppp loan to keep “his” crews.  The crews can get the ppp on their own tho.

Right?

 

Ah ok, so you aren't a business entity (LLC, Corp, etc.)?  If not then I do not know how it would work (if at all) in your situation, apologies.

If Vudu has a legal business entity with 1099 subs, he has the 1099s and can use them as part of the avg monthly salary calculation for PPP.

[usurpers26 26]

11 minutes ago, Alias Detective said:

Viduchili can’t get a ppp loan to keep “his” crews.  
Yes, he can.

The crews can get the ppp on their own tho.
No, they can file for unemployment.

Right?

 

Forgot to literally answer you questions.

[Alias Detective 1,179]

5 minutes ago, usurpers26 said:

Ah ok, so you aren't a business entity (LLC, Corp, etc.)?  If not then I do not know how it would work (if at all) in your situation, apologies.

If Vudu has a legal business entity with 1099 subs, he has the 1099s and can use them as part of the avg monthly salary calculation for PPP.

But he will have to pay the subs from his loan.  What if his subs found work elsewhere?  It like to understand all the nuance.

[Alias Detective 1,179]

@usurpers26

Are you an accountant or in SBA lending?

[usurpers26 26]

4 minutes ago, Alias Detective said:

But he will have to pay the subs from his loan.  What if his subs found work elsewhere?  It like to understand all the nuance.

Correct.  And I have no idea to be honest.  There is definite gray area in this program that people may try to abuse.

 

1 minute ago, Alias Detective said:

@usurpers26

Are you an accountant or in SBA lending?

NO.  Just a small business owner that has a very good accountant and a strong relationship with our local bank. 

[Alias Detective 1,179]

1 minute ago, usurpers26 said:

Correct.  And I have no idea to be honest.  There is definite gray area in this program that people may try to abuse.

 

NO.  Just a small business owner that has a very good accountant and a strong relationship with our local bank. 

Good enough for me.  Thanks for your knowledge.

[vuduchile 1,940]

2 hours ago, usurpers26 said:

You can include 1099s in PPP.

According to my banker, originally they said you could but the rules have since been amended.  
 

She’s saying that my 1099 workers could apply for their own PPP loan.  

[usurpers26 26]

7 minutes ago, vuduchile said:

According to my banker, originally they said you could but the rules have since been amended.  

Very interesting!  I personally know two business owners (construction company and travel agency) all of their "employees" are 1099.  They both were approved for PPP.  I wonder if they got their funds.  Selfishly, I am glad we have all W2 employees - so all my info on the 1099 side is anecdotal.

 

[parrot 789]

42 minutes ago, vuduchile said:

According to my banker, originally they said you could but the rules have since been amended.  
 

She’s saying that my 1099 workers could apply for their own PPP loan.  

This is correct.  

https://www.sba.gov/sites/default/files/2020-04/PPP--IFRN FINAL_0.pdf

h. Do independent contractors count as employees for purposes of PPP loan calculations?

No, independent contractors have the ability to apply for a PPP loan on their own so they do not count for purposes of a borrower’s PPP loan calculation.

[parrot 789]

24 minutes ago, usurpers26 said:

Very interesting!  I personally know two business owners (construction company and travel agency) all of their "employees" are 1099.  They both were approved for PPP.  I wonder if they got their funds.  Selfishly, I am glad we have all W2 employees - so all my info on the 1099 side is anecdotal.

 

They might get their funds if their banker isn't clear on the rules or is counting on them when certifying the number.  Where they could get into trouble is when it comes time for loan forgiveness and their "payroll" doesn't qualify.  

[vuduchile 1,940]

38 minutes ago, parrot said:

They might get their funds if their banker isn't clear on the rules or is counting on them when certifying the number.  Where they could get into trouble is when it comes time for loan forgiveness and their "payroll" doesn't qualify.  

Yes.  I think that might take some people by surprise.  
 

I wasn’t clear on how much of my own compensation could be rolled into this loan and be forgiven if I also filed for unemployment.  It might be allowed but it feels like double dipping to do both.  
 

So I stuck with the unemployment to help offset my own income loss and also applied for the EIDL $10K advance which I believe is basically a grant that we can use for operating expenses until we reopen.  
 

I believe there’s also a state emergency relief fund I can also apply for but I haven’t done it yet.  

[Alias Detective 1,179]

1 hour ago, vuduchile said:

According to my banker, originally they said you could but the rules have since been amended.  
 

She’s saying that my 1099 workers could apply for their own PPP loan.  

My understanding too.  They aren’t just your 1099 employees.  Right?  Meaning, they could be doing other Indy contractor work too.

[cyclone24 1,799]

Wife just said their OBGYN office got approved.

$500,000.

How can we possibly have the money for all this nationally?

[usurpers26 26]

Good info guys, I reached out to the two business owners with an FYI - would hate to see anyone screwed on the other side and owing it all or most when it comes to 1099s.

[vuduchile 1,940]

5 minutes ago, Alias Detective said:

My understanding too.  They aren’t just your 1099 employees.  Right?  Meaning, they could be doing other Indy contractor work too.

Correct. In reality, 80% of their work comes from us, but they are sub contractors who are paid by the job, not by the hour or on salary.