Question of the Week
Did I miss out on stimulus relief?
It’s that time again…Happy Five-Minute Friday!
I hope you all are staying healthy, happy and sane during this time. The last few weeks, we’ve been talking about the government stimulus programs coming down the pike. This week has provided a mixed bag of updates.
First, the fun news. Most of you eligible for a stimulus check and whom had direct deposit info on file got your payments this week. For some, it provides much-needed relief. Others who don’t need the money have found creative ways to use it to help those who do – like donating it to charity or getting lots of take out.
On the other side of the coin, some of you who run small businesses are still waiting on relief. We learned earlier in the week that the SBA changed the rules about the Economic Injury Disaster Loans (EIDL) advance, limiting it to $1,000/employee. (Although some independent contractors are getting at least $1,000.) In addition, EIDLs and Paycheck Protection Program (PPP) Loans have run out of funding. We now wait on Congress to supply additional funds, which in my opinion will happen soon.
In the meantime, if you’re still waiting on funding or haven’t applied yet, you can use this opportunity to get your documents in order. This week, the SBA came out with additional guidance on specific requirements for the PPP loan. Here is the info you will need to gather to substantiate your loan.
For those of you without employees, regardless of whether you filed a 2019 tax return with the IRS, must provide:
- The 2019 Form 1040 Schedule C to substantiate applied-for PPP Loan amount
- A 2019 IRS Form 1099-Misc detailing non-employee compensation (box 7), invoice, bank statement or book of record that establishes that you are self-employed
- A 2020 invoice, bank statement or book of record to establish you were in operation on or around February 15, 2020
For those of you with employees, you must supply your 2019 Form 1040 Schedule C,
- Form 941 (or other tax forms or equivalent payroll processor records containing similar information) and state quarterly wage unemployment insurance tax reporting forms from each quarter in 2019 or equivalent payroll processor records, along with evidence of any retirement and health insurance contributions, if applicable
- A payroll statement or similar documentation from the pay period that covered February 15, 2020 must be provided to establish you were in operation on February 15, 2020
You can read more about the updates here. And as always, let me know if you have any questions.
Quotes of the Week
“Adaptability is about the powerful difference between adapting to cope and adapting to win”. — Max McKeown
Task of the Week
Focus on what you can control. And by that, I mean getting all of your documents in order for your business to take advantage of what’s coming next. Whether it’s preparing your Schedule C or finding a company to apply through, ask yourself what you can do to get in a better position and take that step.