If you applied for and have received your PPP loan funds, congratulations on completing the first step! But you may be asking “Now what do I do?” Our dedicated COVID-19 team is hard at work staying abreast of all current and upcoming relief options available to small businesses across the country. Many of our clients are taking advantage of one or more of these solutions and their dedicated accounting team here is a resource to them for understanding and managing their approach. We have gathered this information and are here for you should you need help as well.
Please note: While we anticipate additional guidance to be forthcoming, there are things you can do now to maximize loan forgiveness. We will keep our blog updated as more information comes out.
- Track the expenses allowed for PPP loan forgiveness (Payroll costs, mortgage interest, rent, and utilities). Do not wait to summarize at the end of the 8 weeks. If you have any questions about which expenses are allowed, please reach out to us.
- Prepare a forecast of anticipated wages (payroll costs including EMPLOYER health insurance and retirement costs) and allowable rent, utilities and mortgage interest over the 8 week period. Please keep in mind, prepaying rent/lease is not allowed.
- The Employer portion of Medicare and Social Security taxes are NOT allowable payroll costs.
- Employers of any size can defer payment of employer Social Security (6.2%) beginning March 27, 2020, and ending December 31, 2020.
- This deferral option continues until either the loan is forgiven or December 31, 2020, whichever is sooner. Deferred taxes are due at 50% by December 31, 2021 and the remaining balance by December 31, 2022. This payroll tax deferral is allowed to be taken in conjunction with the Payroll Protection Loan.
Coming soon - Tax Relief Credits & a PPP Loan Forgiveness Checklist...