We are knee deep in tax forms with the 3/15 deadline looming for corps.
On top of that, of course, Congress continues to throw new things our way. The House passed the “American Rescue Plan” and there are stimulus-ish things to pay attention to.
One provision of note for my NYC business clients: The federal minimum wage hike was included in this bill, but my sources tell me that this is very unlikely to remain in the final bill that makes its way to the President’s desk. I will keep you posted, and we can help you work through whatever implications need to be considered.
I find myself saying this each week, but if you need to get on our calendar, NOW would be a good time to do so:
A quick favor, business owner to business owner: Would you kindly leave us a review on Google?
Make us smile with a review on Google
Apparently it’s one of the primary ways that people are finding and evaluating businesses online these days — so a good word from our friends would go a LONG way. Thank you!
Now … despite our very heightened workflow (which, by the way, we have long planned for) I did want to take a moment to give you the scoop on what’s happening and available with the expanded PPP program, who is eligible (who isn’t), etc.
Go ahead, leave that review for us (use the link I already posted above), and then come back right here and let’s break this down.
All Things PPP For Businesses in NYC
“Success is not final, failure is not fatal: it is the courage to continue that counts.” -Winston S. Churchill
Recently, the Biden administration announced an expansion of the PPP for businesses program to better include certain smaller and minority-owned NYC businesses.
But there are considerations to keep in mind about this.
Before I get into the new things around what was announced last week, here are the basics
Firstly, if you have NOT applied for the PPP in 2020, I suggest that you do so now. For many businesses, these are essentially “grants” from the government (because of how these loans are forgiven). If you have a philosophical problem with doing this, that’s fine. But otherwise … this is one of those “use it or lose it” programs that come around once in a generation.
If you received the first round of PPP, you still might be eligible to apply again (“Second Draw” PPP). Your business is eligible for this second draw if you:
- Previously received a First Draw PPP Loan and will or have used the full amount only for authorized uses
- Have no more than 300 employees; and
- You can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020
That final provision is a nice one because it means that we can take a look at a variety of circumstances that might make you eligible.
Forgiveness terms for both “first draw” and “second draw” are essentially the same:
- Employee and compensation levels are maintained
- The loan proceeds are spent on payroll costs and other eligible expenses; and
- At least 60 percent of the proceeds are spent on payroll costs
And there is a “streamlined” process for loans under $150 K.
Lastly, and this is the big news: There is a special window for smaller and minority-owned NYC businesses to apply before big firms — a window that ends Tuesday, March 9th.
This is important because in 2020 (and especially in the first round of funding) many businesses missed out on receiving these loans because the program funds were depleted quickly. That was less of an issue in the second round of funding, but who knows what will happen with this “Second Draw”.
That’s why I suggest you contact your bank or lender to apply ASAP.
And if you need help in running some numbers to make this happen, we’re right here:
(And if your friends need help, send them our way.)
I’m grateful for our partnership and for your referrals.
Claudine Powell Phillip
Phillip & Associates, LLC
Feel free to share this article with a NYC area (or beyond!) business associate or client you know who could benefit from our assistance. While these particular articles usually relate to business strategy, as you know, we specialize in tax preparation and planning for families and business owners.