Take care of your employees - even if you can’t pay them small business |
- Take care of your employees - even if you can’t pay them
- Was approved for the SBA disaster loan relief funds. AMA!
- The clearest summary of the Paycheck Protection Program I've seen so far
- Here is an the email I sent to my worst customer at 1am
- Google Ads Offering $340 Million in Ad Credit to Small Businesses! Don’t miss yours...
- Here’s a video on a 10k grant in stimulus bill for small business owners
- Pricing ( A rant)
- Some crazy guy on Instagram reported my business ("non-essential") as conducting business when I wasn't.
- Your mediocre website suddenly became your main source of revenue? Let me share my learning from consulting >500 SMBs on their online strategies.
- Employee-owned business tips?
- Making money during crisis
- Who has a business that’s been operating for 1-3 years?
- Self Employed with 1 employee Paycheck Protection Program our Unemployment
- Will EIDL $10K Grant be Taxable?
- Will partially unemployed employees (i.e. significantly reduced hours) be eligible for the $600/week CARES Act benefit?
- Is a short domain name necessary?
- SBA Disaster loan - less than one year in business
- Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) Executive Summary
- Can I file unemployment as an LLC?
- How do you respond to requests for price matching ?
- Will applying for SBA loan affect ability to get home mortgage
- What are your main reasons for hiring a digital marketing agency/freelancer?
- SBA loan
- Do Small "Ma and Pa" shops, that does not have any staff (excluding the owners), qualify for the SBA Cares Act Loan?
| Take care of your employees - even if you can’t pay them Posted: 28 Mar 2020 05:30 PM PDT What we're going through right now is going to have a big effect on how employees view us afterwards. With the employment relationship ending, people are going to be open to looking for other jobs when this is all over. What I've found in talking with dozens of employees that we've had to temporarily pay off is that they're very understanding. They realize we're a small business that can't afford to pay them or offer expanded sick leave and don't blame us for it. Be transparent - share what you know and what you don't know with regards to re-opening date, health of the business, etc. Help them with unemployment - lots of employees aren't familiar with the process, they might assume they're ineligible if they're still working a few hours or if they're going to be rehired later. Giving them links and telling them how to apply goes a long way. Keep them informed about other available resources - from expanded unemployment to the upcoming stimulus as well as local organizations providing meals, grants/loans, etc. Lots of areas have suspended utility payments/evictions, but not everyone knows. Health insurance - this is a tough one, but we made the decision to cover all health insurance payments through April and reassess then. Not every business can do this, but I think it really helps relieve some anxiety employees are facing, especially when they may end up in the hospital soon. Even if you can't afford to maintain health insurance, let them know about COBRA (including grace periods) and marketplace options. Don't force employees to come to work - If you're an essential business that's still open, understand that your employees are scared right now. Obviously don't pay them, but give people the option if you can. There's probably someone else wanting a paycheck anyways. Similarly, give them soap and hand sanitizer and establish protocols to try to keep them safe. Regular communication - it's a big risk to have employees go out of touch for a month or even longer. I try to send weekly updates to everyone letting them know how things stand, any updates in government assistance, etc. [link] [comments]  |
| Was approved for the SBA disaster loan relief funds. AMA! Posted: 28 Mar 2020 02:18 PM PDT Just thought I'd offer to answer any questions small business owners may have regarding the SBA disaster loan assistance program. I applied at http://disasterloan.sba.gov/ by creating an account and then uploading the requested documents. It looks like they've changed the way they collect documents recently but the overall process is the same. Applied on 03/16/20, contacted by SBA loan officer on 03/20/20, approved by 03/24/20. I would recommend everyone to apply whether you need it or not. You are able to get a loan at 3.75% where no payment is due the first year and amortized over 30 years. Why not take advantage? Here's the calculation to figure out how much you will get: Gross revenues - Cost of goods sold = gross profit Gross profit / gross revenue = gross profit % (Gross profit % x Gross revenue) / 2 = Eligible loan amount They divide by 2 because they will give you 6 month's worth of "relief". Edit: Here's a calculator I made. Under file, select "Make a copy". Then simply enter your Gross sales and COGS. [link] [comments]  |
| The clearest summary of the Paycheck Protection Program I've seen so far Posted: 28 Mar 2020 11:02 AM PDT 4-page pdf from the US Chamber of Commerce explaining the Paycheck Protection Program, with way more detail than I've seen anywhere else, including calculators for loan amount and forgiveness amount. Note this is ONLY about the Paycheck Protection Program and does not cover the $10k grant, which I understand to be part of the application process for the existing SBA Economic Injury Disaster Loan. Before this, the most comprehensive detail on the CARES Act (bailout) for businesses has been from redditor /u/LibertyRocks - https://www.reddit.com/r/smallbusiness/comments/fp7qd9/senate_bill_cares_act_summary_phase_3_coronavirus/ If you have questions I can try to help, but I am not a lawyer or expert of any sort - just a guy who has been reading about these provisions for days on end. [link] [comments]  |
| Here is an the email I sent to my worst customer at 1am Posted: 28 Mar 2020 11:09 PM PDT So long story short, I own a lawn care company, and I have one customer who is constantly coming and complaining, texting saying how poorly his lawn looks (and using horrible grammar in the process, which just irks me, take the time to use punctuation ya jackass, I'm worth the extra 2 seconds), and complaining about his bill, then on the same day telling me and his neighbor about his new $5k watch he bought. At 12:30am today he sent me this "To whom it may concern ,, everyone around my house has already had their lawn mowed and again I am the worst yard ,,, please take care of this ASAP " So I went ahead and sent back this: " Hi Mr. (Name) Thanks for letting me know! Ill get out there ASAP on Wednesday, sooner if I can squeeze in a cut on Monday or Tuesday. In the future, please let me know ahead of time, as I have to plan the schedules of 63 other lawns around yours. This is something we commonly run into. That is why I sent a text on 2/12 letting you know exactly what week your lawn would be starting the season, as well as keeping in contact with you on 2/21, and at the start of last week (3/23) letting you know the exact 3 day period your lawn would be scheduled, so that you had adequate time to look at your lawn and decide whether or not it needed mowing before the start date, which I had stated that I was happy to do. You did not ask for an early cut, and therefore I did not add you to the schedule for an early cut. I want to make sure to provide you with all the adequate information that I can provide. I'm sure that at your job, you give your clients updates on when projects will be completed, as well as times that they can put in work orders, and I'm sure that it would be extremely frustrating if the clients constantly disregarded those updates. That is what I deal with on a daily basis, so I'm sure you can understand that I would like to nip this in the bud before it becomes a problem. On another note, you tend to be very unhappy with your lawn care service most times, and that is not the customer experience I want to provide, nor is it the most practical way to get the best service for the best prices. I absolutely do the best I can, however it always seems that you are unhappy at the rate it is being mowed at, so I am moving you from 1 week, to 2 week, to 10 day schedules, just so that you are on a schedule that you like and that you can afford. I want to make sure that every customer is extremely happy, however you tend to be an outlier in the 60+ extremely happy customers that I have, and 300+ that I have serviced over the last 11 seasons. If you would, please tell me what you would like to see from your lawn, and I would be happy to find (or build) a service option that I offer that fits your vision! Thanks! " I hate this customer and I hate that he treats me like a second class citizen just because I do real, hard work and he does some shit running an assembly line. He pisses me off and makes my blood boil every time i see a message from him, however I can't afford to drop him as a customer, so I just have to deal with his bullshit day in and day out. Anyway, I hope this was okay to post here, and thank you all for listening, and if you have constructive criticism that you can convey using less than 4 commas per line, I would be happy to hear it. [link] [comments]  |
| Google Ads Offering $340 Million in Ad Credit to Small Businesses! Don’t miss yours... Posted: 28 Mar 2020 10:03 AM PDT |
| Here’s a video on a 10k grant in stimulus bill for small business owners Posted: 28 Mar 2020 08:20 PM PDT |
| Posted: 28 Mar 2020 05:47 PM PDT I'm so fucking annoyed right now. My company is growing and I need to streamline our recruitment (It's just me right now). What I want is a site that will allow me post job opening on my website and also post it on other sites like monster, indeed or any of the smaller ones. Don't really care as long as the job posting is out there. I also want the candidates to be able to upload their resumes/cv to my site. Most of these fucking sites don't give enough information. They want my information for a "free demo". I don't want a free demo. I want to know the fucking price so I can move on, either research your company more in depth or move on to another company. I don't want a sales call wasting my time trying to get me to sign up for something that is out of my price range. If your company isn't upfront with pricing, I'm out. I mean come on! If it's cloud based, the price shouldn't change except to scale. But if you aren't putting it out there, then to me, that means your pricing is based on what you think I can pay. Ziprecruiter is $249/month/user base Indeed is 10% of annual salary once you hire someone To me, that's crazy expensive but if I was a large company, I guess that would be peanuts. I'd like to think that's peanuts but I'm not there yet. Still doing research but zoho and VIVAHR seems to do want I want at an affordable price. IF YOU ARE DOING A CLOUD BASED BUSINESS HAVE YOUR PRICING UPFRONT. shit. I totally know this is a good problem to have but it's still annoying as all fuck. [link] [comments]  |
| Posted: 28 Mar 2020 07:33 PM PDT I own a mobile personal training business. Governor issued a shut down of all essiential businesses. I assume I'm non-essential? I don't really know. Anyway I went to the park to workout with 2 friends. He took a picture of car magnets, posting on his Instagram and blew up my business Instagram with disparaging comments and that I need to be shut down. He tagged the governor in the posts. This is absolutely crazy. I'm worried they might take this nutjob seriously. What should I do? I blocked him. Anything else I should do? [link] [comments]  |
| Posted: 29 Mar 2020 03:54 AM PDT Hi all, I hope you and your closes ones are well. I work for a major tech company, consulting small businesses with regards to their online strategies on a day to day basis. In the past years I gained some valuable insights from speaking to smbs in all shapes and sizes. If you need a free consultation, shoot me message, I am happy to offer my help here! [link] [comments]  |
| Posted: 29 Mar 2020 03:51 AM PDT I'm considering creating an employee own barbershop and would appreciate any advice given. [link] [comments]  |
| Posted: 29 Mar 2020 03:40 AM PDT Drop shipping during virus New products during virus What are you thinking of guys? I was selling hand sanitiser for last two weeks here in UK but all collapsed, shopify started withholding payments for 4 months now, no google/fb ads allowed, so business gone. Not that I was price gauging, but they don't want any trouble so they ban everyone Thought of some homeopathy etc but seems that's banner now too. Not that it cures - bit something I thought may be in demand. Running out of ideas and have to scrap smth for living. Someone has to be making money still? Or someone made already during chinese outbreak?? [link] [comments]  |
| Who has a business that’s been operating for 1-3 years? Posted: 29 Mar 2020 03:28 AM PDT I am doing a research on small business owners. I would appreciate if you can help. [link] [comments]  |
| Self Employed with 1 employee Paycheck Protection Program our Unemployment Posted: 28 Mar 2020 09:05 AM PDT Reading over everything in the CARES bill, I am trying to figure out what is the best option for my business, employee and myself. I own a gym and have been forced to close my doors essentially cutting off all revenue. I paused all dues, have several members who are supporting by not pausing and am renting out equipment. Overall my revenue is under 10% of normal levels. Looking at the Paycheck Protection Program it looks like I could get a forgivable loan of 2.5 times my avg monthly payroll to cover expenses etc. Unemployment benefits honestly look like I/employee would get a greater amount total. I also have about 7 part time independent contractors but they should be covered. So not as much of a concern, also as only one uses it as his primary income. My general situation and questions, my landlord is not charging me rent while I am forced to close. I have an SBA loan which I should be able to pause, so my expenses are not that great honestly. So I am trying to figure out my best option, as I believe my business which relies half on personal training and half on gym memberships will take a massive hit over the next year. When running a business and self-employed what constitutes unemployed? I literally am not going to be able to pay myself, but obviously will be able to "work". Even with my business technically closed I am operating a makeshift rental business. So would I be eligible or better off not doing anything? I have a pregnant wife who in the healthcare administration industry which is taking a massive hit with no elective procedures right now. So things are scary. Or would I be better looking into the PPP? There is little clarity, but I want to do what is best for the long term health of my business which has grown modestly over 9 years. Thank you so much for any input as I have no clue what to do at the moment. [link] [comments]  |
| Will EIDL $10K Grant be Taxable? Posted: 28 Mar 2020 09:56 AM PDT I've seen numerous mentions that a forgiven paycheck protection loan will NOT be considered taxable income, but have not seen anything that specifically says this is the case with the EIDL $10K grant. Anyone know? [link] [comments]  |
| Posted: 28 Mar 2020 01:00 PM PDT I know many small business owners are scratching their heads about the $600/week CARES Act unemployment benefits, which stacks on top of existing State-level unemployment benefits. This means many employees would make significantly more being unemployed than being employed. Which puts business owners trying to maintain some operations during the crisis in an odd situation, since you don't want to disadvantage your employees (for the next four months anyhow) by re-hiring them or maintaining their jobs. (A crazy sentence, I know, but that's the reality of the law at this point.) Here's a possible solution. Reduce people to part-time (or re-hire previously full-time people at part-time), so that they still qualify for partial unemployment benefits. Even though their normal state-level benefits will be reduced pro rata, it seems the $600/week from the Cares Act will not -- they still get the whole $600/week. This way, by working part-time, they get part-time pay, plus partial state-level benefits, plus the full $600/week -- which means they can make more working part-time than not working (as opposed to making less if they worked full-time and lost out on the $600/week). Anyone consider this approach? Can anyone confirm that the $600/week indeed does get paid in full even if employees are only on partial unemployment as opposed to full unemployment? [link] [comments]  |
| Is a short domain name necessary? Posted: 28 Mar 2020 08:25 PM PDT Say I wanted to name a business as "clear cut gardening services" Should my domain name be www.clearcutgardeningservices.com Or should I'd just be www.clearcut.com? [link] [comments]  |
| SBA Disaster loan - less than one year in business Posted: 28 Mar 2020 05:21 PM PDT My practice is in its first year of business (8 months), and has been steadily increasing monthly sales by almost 100% each month. Does a business in less than one year of business qualify for SBA disaster? [link] [comments]  |
| Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) Executive Summary Posted: 28 Mar 2020 02:03 PM PDT This is a summary that was sent to me and not my own. This helped me a ton and wanted to share it with you. 3/23/2020 Update In response to the economic and public health impact of the COVID-19 pandemic the US government has been working to pass a fiscal stimulus package with several key features designed to support small businesses (the CARES Act). This bill is still working its way through the Senate and is subject to change; however, regardless of tweaking changes the key resources provided to small businesses will consist of7(a) loans, 7(a) express loans, andeconomic injurydisaster loans ("EIDL"). Global Notes · The small business support programs listed below are mutually exclusive, a business cannot receive both an EIDL and a 7(a) loan. A company must pick a path and stick with it to receive aid. 7(a) Loans What is this? · 7(a) loans are a form of financing for small businesses. The 7(a) loan program is overseen by the SBA and provides government guarantees for small business loans that are originated and held by approved 7(a) lenders (most insured depository institutions are 7(a) lenders). As part of the CARE Act, the 7(a) loan program is being expanded and modified. · The government will use the existing SBA 7(a) lending infrastructure to distribute loans to small US businesses (<500 employees, or otherwise meet the SBA's size requirements) that operate in states or territories that have at least one confirmed case of COVID-19. Key features of these loans include: o Size:2.5x TTM payroll costs; up to a maximum of $10MM o Guarantee: for borrowers, there are no collateral or personal guarantee requirements; for lenders, the loans are 100% guaranteed by the US government o Interest Rate: low o Loan Forgiveness: SBA shall issue loan forgiveness rules within 30 days of enactment. Current guidance is as follows: (i) loan proceeds used for eligible purposes within 8 weeks of loan origination are eligible for forgiveness (current eligible purposes are payroll, employee benefits and operating costs including rent/mortgage payments/utilities/interest on existing debt); (ii) if borrower reduces payroll or number of employees during the covered period, the loan amount available for forgiveness is reduced (exceptions for tipped workers and re-hires);(iii) borrowers shall file for forgiveness directly with their lender and no loan forgiveness will be granted without documentation; and (iv) cancelled indebtedness is not taxable to the borrower as gross income o Fee: no fees can be charged by the lender related to these loans o Tenor: any unforgiven loan balance will have a maturity of not more than 10 years Who do I talk to? · Loans will be provided by all existing 7(a) lenders as well as a variety of new entities which extend beyond insured depository institutions. Current guidance says new 7(a) lenders will include: (i) institutions of the Farm Credit System; and (ii) "other lenders that do not already participate in SBA lending programs" (this provision permits the federal government to expand the pool of potential lenders that are deemed fiscally safe and sound to include BDCs, SBICs and RBICs). · It is recommended that applying with an existing 7(a) lender, rather than a new 7(a) lender, will result in faster processing times. · Large banks that offer 7(a) loans include: CIBC; KeyBank; TD Bank; BBVA; Bank of America; Capital One, Citizens Bank; PNC Bank; Wells Fargo; and Truist Bank. Note that this is only a subset of the available 7(a) lenders and most depository institutions will be participating in the program. It is recommended you check with your current lenders to see if you can leverage your existing relationships to accelerate the loan application/approval process. What do I need to prepare to apply? · While the bill that initiates the new 7(a) loan stimulus package is still passing the Senate, it is recommended that potential borrowers prepare application materials in advance to accelerate the time it takes to receive funding. · Since each 7(a) lender is performing its own loan applicant evaluation, the materials required to apply could vary from lender to lender but will likely have a substantial amount of overlap. Keeping that in mind, below is a representative list of materials requested by Wells Fargo from a potential 7(a) loan applicant: o Business: § 2016 - 2019 business tax returns § 2019 year-end P&L and Balance Sheet (if 2019 is on extension) § 2020 interim P&L and Balance Sheet § Completed business schedule of debt § Budget/Breakdown of Loan Proceed Utilization o Personal (all owners): § 2016 - 2018 personal tax returns § 2019 W2's if applicable § 2020 YTD paystub if applicable § Completed household personal financial statement Note that the Personal items listed above may not be required for the CARE Act related 7(a) loans since there is no requirement for a personal guarantee. 7(a) Express Loans What is this? · 7(a) Express Loans are like regular 7(a) loans but are for smaller amounts that can be accessed more quickly. 7(a) express loans are for amounts of up to $1.0MM with a 36-hour decision making process. These loans are ideal for Companies seeking immediate liquidity that need to prioritize speed of capital infusion over amount. Who is eligible? · Current guidance does not show different eligibility requirements for 7(a) loans and 7(a) express loans. Who do I talk to? · Any existing 7(a) or newly approved 7(a) lenders can also provide 7(a) express loans. What do I need to prepare to apply? · The same as the normal 7(a) requirements Economic Injury Disaster Loans (EIDL) What is this? · The EIDL is a low-interest, fixed-rate loan that can provide up to $2 million in assistance for a small business. SBA's Economic Injury Disaster Loan (EIDLs) funds come directly from the U.S. Treasury. Applicants do not go through a bank to apply, and instead, apply directly to SBA's Disaster Assistance Program.Key loan features include: o Size: up to $2MM, determined based oneconomic injury o Interest Rate: 3.75% fixed rate o Tenor: Flexible, with final maturities of up to 30 years Who is eligible? · To be eligible for EIDL assistance, small businesses or private non-profit organizations must have sustained economic injury and be located in a disaster declared county or contiguous county. Who do I talk to? · Apply directly through the SBA's Disaster Assistance Program on the SBA website What do I need to prepare to apply? · Note that demand for the EIDL program is high and the SBA website has had trouble recently processing the increased traffic · Items to gather before applying include: o Most recent Federal Tax Return o Year-End P&L statement o YTD P&L statement o Monthly sales break down · Necessary SBA forms to become familiar with: o Loan application (SBA form 5 for businesses and SBA form 5c for sole proprietor) o Tax Information Authorization for the applicant, principals and affiliates (IRS form 4506T) o Schedule of Liabilities (SBA form 2202) o Personal Financial Statement (SBA Form 413) · Tips for applying include: o Include the disaster in your application – specifically name "COVID-19" or "Coronavirus" o Apply online versus by mail o Write your password down; neither the system nor any personnel are able to retrieve it o Save your work at every prompt. The website may go down periodically due to high volume. If this happens, try to login again at a later time. We recommend working on your application during non-peak hours such as later evening or early morning. o Do not rush through the application. Check and recheck the filing requirements to ensure that all the needed information is completed prior to submission. The biggest reason for delays in processing is due to missing information. o Be sure to use the same contact information (business name and the name of all owners) that you use on your federal tax returns. Double-check that they match. o If your tax returns reference other businesses that you own, you must also submit those tax returns in order to avoid a processing delay. o If more funds are needed, applicants can submit supporting documents and a request for an increase. If less funds are needed, applicants can request a reduction in the loan amount. o If the loan request is denied, the applicant will be given up to six months in which to provide new information and submit a written request for reconsideration [link] [comments]  |
| Can I file unemployment as an LLC? Posted: 28 Mar 2020 09:54 PM PDT I own an LLC. There is no payroll, it's just me. I looked at the SBA $10k grant as well as the loans but from what I gathered I can't apply because I don't have a federal unemployment insurance ID number. Location: Maryland Occupation: Videographer Outside of a project or two on my plate all of my future work has been cancelled and I have no sign that I'll be able to make income after about two weeks from now. I applied online for the unemployment insurance ID but they said it could take 2-3 weeks to receive it by mail. So am I just screwed and unqualified for this grant or loan program? Do I have any options here other than a bank loan? [link] [comments]  |
| How do you respond to requests for price matching ? Posted: 28 Mar 2020 11:40 AM PDT I have a medium sized ($2mm annual) retail ecommerce business. Average shopping cart $130. A few times a week we get emailed requests that go something like "your item X is priced 80 but Joe blow other store is selling at 72, can you match the price?" Or maybe it's a bigger difference like $279 against $329. My employees and I don't like dealing with this because it is an admin headache / time-waster. Also in some cases to match a competitor's price would mean we would lose money because our shipping price is a flat rate that is lower than the actual cost of shipping, while many other stores in my industry charge the customer the actual shipping cost plus a markup. Frankly most of our competitors do not offer nearly as good of a shopping experience as us. (Am I right to assume that the customers are asking for a price match because they prefer to buy it from us?) For example one competitor is located right next to a distributor so they can pre sell product they don't even have, then go down the street and buy product and then sell it at razor thin margins. Meanwhile if you email them a question it's gonna take two weeks to get an answer. Even if you place an order you might get it in a week or you might get it in three weeks. My business is pretty new , only a few years old so we haven't really developed a policy around price matching. Depending on which employee the customer communicates with, they may get a different answer. now I am starting to think deeply about it so that we can have a consistent approach moving forward. While writing this post I got the idea that maybe price matching shows a lack of integrity because you're saying yes our price is too high but since you caught us we're gonna give you a price that's actually fair but all of our other customers who don't shop around are getting screwed. I am considering to have internal policy of declining to match prices. (The only exception might be if we discover that we have mistakenly priced way above the market and then we choose to actually change the asking price. ) The rationale being that my employees have better things to do And we have confidence that we have priced products accurately and fairly in the context of the entire experience of buying from our store. Looking for others' thoughts on this. Thanks and be healthy [link] [comments]  |
| Will applying for SBA loan affect ability to get home mortgage Posted: 28 Mar 2020 02:00 PM PDT I'm in the process of selling my home and looking to buy a new one. I already got pre-approved for the new mortgage, but my lender was very adamant about me not doing anything that could affect my credit. I have an LLC partnership (non S-Corp) with 2 employees on payroll. I would like to take advantage of the PPP and Disaster loan programs as my business has seen a significant decrease in revenue due to the virus. Would an SBA loan hit my personal credit report? Would getting this loan affect my chances of getting a final approval on my mortgage? [link] [comments]  |
| What are your main reasons for hiring a digital marketing agency/freelancer? Posted: 28 Mar 2020 11:43 PM PDT Basically the headline.. Why do you outsource digital marketing? What are your main needs/concerns? [link] [comments]  |
| Posted: 28 Mar 2020 07:21 PM PDT Overview The Coronavirus Aid, Relief, and Economic Security (CARES) Act creates a new Small Business Administration (SBA) loan program, called the "Paycheck Protection Program" (PPP). The Paycheck Protection Program provides small businesses with zero-fee loans of up to $10 million to cover payroll and other operating expenses. Up to 8 weeks of payroll, mortgage interest, rent, and utility costs can be forgiven. Payments on principal and interest are deferred for six months and up to one year. Small businesses will be able to apply if they were harmed by COVID-19 between February 15, 2020, and June 30, 2020. This program is retroactive to February 15, 2020, in order to help bring workers who may have already been laid off back onto payrolls. Loans are available through June 30, 2020. Eligibility You are eligible if: Your business or entity was in operation on February 15, 2020; You are a small business, a 501(c)(3) nonprofit organization, a 501(c)(19) veterans organization, or tribal business concern that has fewer than 500 employees, or the applicable size standard in number of employees for the North American Industry Classification System (NAICS) industry as provided by SBA, if higher. You are a sole proprietorship, an independent contractor, or self-employed. You are a franchise business that employs not more than 500 employees per physical location and your business has an NAICS code beginning with 72, for which the affiliation rules are waived. Affiliation rules are also waived for any business operating as a franchise that is assigned a franchise identifier code by the SBA, and any company that receives funding through a Small Business Investment Company. Loan Size: Your maximum loan size is 250% of average monthly payroll costs from February 15, 2019, to June 30, 2019. If you are a seasonal employer, you can opt to choose March 1, 2019, as the time period start date. If you were not in business this time last year, your maximum loan is equal to 250% of your average monthly payroll costs between January 1, 2020, and February 29, 2020. The loan maximum in all cases is $10 million. Payroll costs for the purposes of determining your loan size include: Compensation (salary, wage, commission, or similar compensation, payment of cash tip) Payment for vacation, parental, family, medical, or sick leave Allowance for dismissal or separation Payment required for group health care benefits, including insurance premiums Payment of any retirement benefit Payment of State or local tax assessed on the compensation of employees The following costs do not count towards your loan size: compensation over $100,000, certain withheld taxes, compensation for employees outside of the United States, and required leave under the Families First Coronavirus Response Act, for which a credit is allowed. Use of Loan Funds: You may use the funds for: Payroll costs (all costs included above) Costs related to group health care benefits during periods of paid sick, medical, or family leave, and insurance premiums Employee salaries, commissions, or similar compensations (except as excluded above) Payments of interest on any mortgage (but not payment or prepayment of principal) Rent Utilities Interest on any other debt obligations that were incurred before the February 15, 2020. Loan Terms: For any amounts not forgiven, the maximum term is 10 years, the maximum interest rate is 4 percent, zero loan fees, zero prepayment fee (SBA will establish application fees caps for lenders that charge). Loan Forgiveness: You can apply to your lender to forgive your loan for the amount of payroll costs plus payments of mortgage interest, rent, and utilities incurred during the 8-week period after the loan is disbursed. The amount that can be forgiven is proportionate to maintaining employees and wages. You must apply through your lender for forgiveness and provide: Documentation verifying the number of employees on payroll, their pay rate, IRS payroll and state income tax filings, and unemployment insurance filings; Documentation verifying payments of rent, mortgage interest, utilities, and other debt; and Certification from your business that the documentation provided is true and that amount of the loan that is being forgiven was used in line with the program's requirements. Any loan amounts not forgiven are carried forward as an ongoing loan with max terms of 10 years, at a maximum interest rate of 4 percent. Principal and interest will continue to be deferred, for a total of 6 months to a year after disbursement of the loan. Can I use a Paycheck Protection Loan with other SBA loans? Yes, you may apply for a paycheck protection loan and other SBA loans, including the SBA economic injury disaster loans, 7(a) loans, 503 loans, and microloans. However, you may not use funds from each of these programs for the same purposes. [link] [comments]  |
| Posted: 28 Mar 2020 06:06 AM PDT From what I have read, the main purpose of this loan is to conserve employee payroll. What about businesses that are operated exclusively by the owners, thus not having a payroll? Sorry for asking another SBA related question. I tried finding a similar question to this, but I couldn't. [link] [comments]  |
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