August 7, 2020
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Forgiveness FAQ
On Tuesday, the Small Business Administration (finally) issued an FAQ on the Paycheck Protection Program (PPP) loan forgiveness application process. It clarifies eligible forgiveness costs, reduction calculations, and more.
Here are a few highlights:
- Sole proprietors, independent contractors, and self-employed individuals without employees automatically qualify to use the simplified EZ application for forgiveness.
- Scanned documents and e-signatures are A-OK.
- As long as borrowers submit loan forgiveness applications within 10 months after their covered period ends, they won’t have to make any payments until the SBA issues their forgiveness amount.
- Check out question #8 for a detailed look at how owner compensation forgiveness amounts are determined by entity type.
With the 24-week covered period coming to a close for many businesses next month, make sure you keep this FAQ and our PPP forgiveness application guide handy. It comes with detailed instructions for both the EZ and regular forms of the application, as well as a calculation spreadsheet to ensure you get the math right.
In hot water
You may have seen headlines about companies like Walmart and Kroger landing in legal hot water due to missteps while managing employees who contracted COVID-19—but it’s not just the big guys that need to worry about costly litigation. Employment claims are spiking for companies of all sizes amid devastating job losses. With the added fear and safety issues caused by a novel pandemic, our current situation is ripe for workplace legal claims.
There are a few main areas employers should watch out for, including:
- Safety: Is your workplace compliant with all new federal and local safety requirements?
- Privacy: How can you ensure employee’s health information is protected while screening for COVID in your workplace?
- Leave: Do you know the ins and outs of FMLA and new leave provisions under the FFCRA?
- Employment: Have your workers requested accommodations or voiced concerns about new workplace guidelines? As you change wages and hours, are you still compliant with minimum wage requirements?
Our guide to COVID legal claims covers all of these areas, and we’ve also done an extra dive into discrimination issues that can arise as employees come back to work.
New lease on livelihood
We’ve been so inspired by the resilience and creativity small businesses have shown in the face of these trying times. From a photobooth company becoming a purveyor of locally-produced goods to a bakery launching Portland’s hottest vending machine, entrepreneurship is far from dead and gone.
USA Today columnist Steve Strauss has put together a whole list of ways local businesses have been playing to their strengths and pivoting to navigate the pandemic downturn:
Read Steve’s full article on business pivot examples and how to pivot your business.
Watch list: Recovering from lockdown
Small businesses across America are being put through the wringer. Join Gusto and Bench on Wednesday, August 12 for an information-packed webinar that will help you develop an action plan for your business. We’ll walk you through how you can leverage tools and resources to implement strategies that will propel your business from surviving to thriving.
PPP ends Saturday, and other headlines from the week
- Time’s up: With $128 billion still available, the PPP’s extended application deadline is coming up this Saturday, August 8. As we’ve mentioned in our coverage of the upcoming HEALS Act, it’s likely this won’t be the last round of PPP funding—and more targeted relief may be on the horizon. But as of now, many businesses are left in the lurch.
- Changing tides: A new survey shows a 17-point increase in the number of small business owners who say BIPOC-owned small businesses face more challenges than White-owned companies. While this doesn’t fix the problem at hand, greater awareness may bring a sharper focus on inequity faced by BIPOC business owners and, in time, support and solutions.
- Business interrupted: Thousands of business owners have discovered that the business interruption insurance policies they pay thousands of dollars a year for won’t pay them a thing amid this… business interruption.
- Updated timelines: The CDC has contracted the recommended quarantine time to 10 days after symptoms first appear.
Top relief options for the week
- Lowe’s has increased its minority small business grants to $30 million and is adding $25 million to its small business grant program with the Local Initiatives Support Corporation (LISC). Applications will be accepted starting August 31.
- AEO and GoDaddy are teaming up to provide technical assistance to business owners. Accepted organizations will receive a $25,000 grant and GoDaddy content and coaching.
- The Wyoming Business Council announced two new waves of funding. The Relief Fund has $50 million set aside for businesses and nonprofits required to close by public health order, and an additional $125 million is available to cover COVID-19-related expenses and losses. Businesses with 100 or fewer employees can apply for awards up to $300,000.
- New Mexico launched the $400 million Small Business Recovery Loan Fund. The program will provide loans of up to $75,000 at interest rates set at one-half the prime rate on the day of the loan.
- The North Carolina Department of Commerce launched the $15 million Job Retention Grant program offering grants up to $250,000. Applications are due on September 1.
- Orange County’s COVID-19 Layoff Aversion Support Program is providing up to $10,000 in grant funds for eligible businesses.
Want more small business news and resources? Check out past editions in our archive.
