Planning g to U Use Y Your L Loans Moderator/Host jeff@jeffbelkora.com May 7, 2020 Presented and Sponsored by Thomas Doll, CPAs travis@thomasdoll.com, brett@thomasdoll.com Tomorrow (May 8) afternoon: Access webinar slides/recording/materials from https://thomasdoll.com/covid-19/ Also see April 29 webinar and white paper on Planning to Reopen
Ove verview 1. Objectives: Maximize Health of Your Patients and Practices 2. Primary Audience: Thomas Doll accounting/bookkeeping clients 3. Today: webinar, FAQ, Expense Eligibility Guide & Forgiveness Tracker (ADCPA) 4. Accounting/bookkeeping clients: use materials, get help from TD team 5. Others: use materials, submit a request for consultation − See https://thomasdoll.com/request-consultation Disclaimer: today’s guidance may be superseded by SBA at any time! Tomorrow (May 8) afternoon: Access webinar slides/recording/materials from https://thomasdoll.com/covid-19/
Pl Planning to U Use PPP PPP and E EIDL Funds . May 7, 2020 Travis Slade, CPA Brett LeMmon, CPA travis@thomasdoll.com brett@thomasdoll.com Tomorrow (May 8) afternoon: Access webinar slides and recording at thomasdoll.com/covid-19/ thomasdoll.com
4 Agenda • Overview of SBA Programs • How to Use Your SBA Funds • Frequently Asked Questions thomasdoll.com
Overview of SBA Programs How to Use Your SBA Funds FAQs 5 > EIDL, PPP Over Ov erview o of S SBA L Loans • Economic Injury Disaster Loan (EIDL) EIDL – Emergency Advance (Grant) EIDL – (Loan) • Intended Purpose • Intended Purpose • Quick funds to help business • Loan working capital to companies in distress • Amount • Amount • Applicants could receive up to $10,000 or $1,000 per employee • Up to $2 million • Does not need to be repaid • Repaid over 30 years, 3.75% • Status of the Program • Status of the Program • Money will appear in your account. EIDL • Will be contacted by SBA to confirm you applications are still being processed want to take out this loan • No new applications at this time • EIDL applications are still being processed • No new applications at this time thomasdoll.com
Overview of SBA Programs How to Use Your SBA Funds FAQs 6 > EIDL, PPP Over Ov erview o of S SBA L Loans • Paycheck Protection Program (PPP) • Intended Purpose • Help employers pay employees during COVID-19 crisis • To keep employees off unemployment • If funds used for qualified purposes (mostly payroll), the loan would be forgiven • Status of the Program • Round 1: $349 billion started on April 3 rd ; ran out on April 16 th • Round 2: $310 billion replenished on April 27 th • Can still apply? Yes (~$135 billion left as of 5/1/2020) • Large banks struggling to keep up with applications. Generally speaking, small businesses were neglected in the early stages thomasdoll.com
Overview of SBA Programs How to Use Your SBA Funds FAQs 7 > Disclaimers, EIDL Advance, PPP Timing, Eligible Expenses, Forgiveness Basics, Uncertainty, Case Studies, Strategies Using Your S SBA F Funds • DISCLAIMERS • Lack of guidance on the application of PPP rules • You need to make decisions now. We will give you our best understanding of things today • May be superseded tomorrow • PPP legislation may change • Do you qualify as having an “economic hardship” • You have been closed since March 16 • If you aren’t sure, seek legal counsel thomasdoll.com
Overview of SBA Programs How to Use Your SBA Funds FAQs 8 > Disclaimers, EIDL Advance, PPP Timing, Eligible Expenses, Forgiveness Basics, Uncertainty, Case Studies, Strategies Using Your S SBA F Funds • EIDL Advance Payment • Timing of the PPP • Qualified Expenses of the PPP • PPP Forgiveness Basics • Areas of Uncertainty • Case Studies • Possible Strategies thomasdoll.com
Overview of SBA Programs How to Use Your SBA Funds FAQs 9 > Disclaimers, EIDL Advance, PPP Timing, Eligible Expenses, Forgiveness Basics, Uncertainty, Case Studies, Strategies Economic I Injury Disaster Loan ( (EIDL) L) Advance P Payment What can I use these funds for? • Refer to expense guide • Can be used for almost any business expense • Avoid expenses that can be paid with PPP funds • CANNOT Use for • 1. Owner draws/distributions • 2. Refinancing other debt thomasdoll.com
Overview of SBA Programs How to Use Your SBA Funds FAQs 10 > Disclaimers, EIDL Advance, PPP Timing, Eligible Expenses, Forgiveness Basics, Uncertainty, Case Studies, Strategies EIDL Ad EI L Advance Payment • Your EIDL Advance reduces the amount of your PPP forgiveness Example A Example A Example A Example A Example A Example A Example B Example B Example C A. Theoretical Funds A. Theoretical Funds A. Theoretical Funds A. Theoretical Funds A. Theoretical Funds A. Theoretical Funds A. Theoretical Funds $10,000 EIDL Advance $10,000 EIDL Advance $10,000 EIDL Advance $10,000 EIDL Advance $10,000 EIDL Advance $10,000 EIDL Advance $0 EIDL Advance $0 EIDL Advance $10,000 EIDL Advance Received Received Received Received Received Received Received $60,000 PPP $60,000 PPP $60,000 PPP $60,000 PPP $60,000 PPP $60,000 PPP $60,000 PPP $60,000 PPP $0 PPP $70,000 Total Funds $70,000 Total Funds $70,000 Total Funds $70,000 Total Funds $70,000 Total Funds $70,000 Total Funds $60,000 Total Funds $60,000 Total Funds $10,000 Total Funds B. Eligible PPP Forgiveness B. Eligible PPP Forgiveness B. Eligible PPP Forgiveness B. Eligible PPP Forgiveness B. Eligible PPP Forgiveness B. Eligible PPP Forgiveness $50,000 $50,000 $50,000 $50,000 $50,000 $60,000 $60,000 NA ($60,000 PPP - $10,000 ($60,000 PPP - $10,000 ($60,000 PPP - $10,000 ($60,000 PPP - $10,000 ($60,000 PPP - $10,000 ($60,000 PPP - $0 EIDL ($60,000 PPP - $0 EIDL EIDL Advance) EIDL Advance) EIDL Advance) EIDL Advance) EIDL Advance) Advance) Advance) C. Total Amount of “Free” C. Total Amount of C. Total Amount of “Free” C. Total Amount of “Free” C. Total Amount of “Free” $60,000 $60,000 $60,000 $60,000 $60,000 $60,000 $10,000 Money Potentially “Free” Money Money Money Money ($50,000 Line B + $10,000 ($50,000 Line B + $10,000 ($50,000 Line B + $10,000 ($50,000 Line B + $10,000 ($60,000 Line B + $0 EIDL ($60,000 Line B + $0 EIDL EIDL Advance) EIDL Advance) EIDL Advance) EIDL Advance) Advance) Advance) D. Amount of Non- D. Non-Forgivable Funds D. Amount of Non- D. Amount of Non- $10,000 $10,000 $10,000 $0 $0 $0 Forgivable Funds (becomes (Becomes a Loan) Forgivable Funds (becomes Forgivable Funds (becomes ($70,000 Line A - $60,000 ($70,000 Line A - $60,000 ($70,000 Line A - $60,000 ($60,000 Line A - $60,000 ($60,000 Line A - $60,000 ($10,000 Line A - $10,000 a Loan if not repaid) a Loan if not repaid) a Loan if not repaid) Line C) Line C) Line C) Line C) Line C) Line C) thomasdoll.com
Overview of SBA Programs How to Use Your SBA Funds FAQs 11 > Disclaimers, EIDL Advance, PPP Timing, Eligible Expenses, Forgiveness Basics, Uncertainty, Case Studies, Strategies PPP T Tim imin ing End of Covered Apply for Bank Forgiveness Bank Receives Origination Period Forgiveness Deadline SBA Approval Date 8-Week Covered 10 Days to 60 Days Period Disburse Funds to Your Bank Account thomasdoll.com
Overview of SBA Programs How to Use Your SBA Funds FAQs 12 > Disclaimers, EIDL Advance, PPP Timing, Eligible Expenses, Forgiveness Basics, Uncertainty, Case Studies, Strategies PPP T Tim imin ing Origination End of Covered Date Period 8-Week Covered Period Closed Closed Closed Closed Reopening Reopening Reopening Reopening thomasdoll.com
Overview of SBA Programs How to Use Your SBA Funds FAQs 13 > Disclaimers, EIDL Advance, PPP Timing, Eligible Expenses, Forgiveness Basics, Uncertainty, Case Studies, Strategies PPP E Elig igib ible E Expenses Please refer to detailed expense guide thomasdoll.com
Overview of SBA Programs How to Use Your SBA Funds FAQs 14 > Disclaimers, EIDL Advance, PPP Timing, Eligible Expenses, Forgiveness Basics, Uncertainty, Case Studies, Strategies PPP E Elig igib ible E Expenses PPP Eligible for Practice Expenses/Costs PPP Eligible FORGIVENESS Payroll Costs Rent Utilities Mortgage Interest (business real estate) Other Debt Interest (ex. practice loan) NO Personal Protective Equipment (PPE) NO NO thomasdoll.com
Overview of SBA Programs How to Use Your SBA Funds FAQs 15 > Disclaimers, EIDL Advance, PPP Timing, Eligible Expenses, Forgiveness Basics, Uncertainty, Case Studies, Strategies PPP Eligible e Expen penses f es for F Forgiven eness ess • Payroll Costs • Rent • Utilities • Mortgage Interest • Applies to expenses that are “incurred” and “paid” during the eight-week covered period • Prior hours? • Prior utility/rent expenses prior to the time you received PPP funds? thomasdoll.com
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