Hi Welcome to ValuationPodcast.com - A podcast and video series about all things related to business and valuation. My name is Melissa Gragg, a company valuation expert in St. Louis Missouri.
During this episode we will discuss PPP loan forgiveness rules or spending rules and the PPP Loan forgiveness application process with Mark Nicholas, a forensic accounting expert and CPA in St. Louis as well as Bloomington and Decatur, Illinois. Welcome Mark!!
Once again, the PPP loan program has undergone changes that will affect how full forgiveness is achieved. This time there is some good news! On June 5th, the Paycheck Protection Program Flexibility Act was signed into law that added some additional key provisions to help business owners meet the forgiveness requirements more easily.
- I understand the time period for spending the PPP loan funds has been extended. How long is it and what does that mean for business owners?
- The old rules for spending the PPP loan funds was 75% on payroll costs and 25% on certain other items. What changed?
- Are the loan terms of 2 years and 1% interest still in place?
- Is it too late to still apply for a PPP loan?
- What do we need to know about the PPP Loan Forgiveness Application and should the business owner wait to fill out the application?
- What do we know about Prioritized Paycheck Protection Program Act?
- Eligible businesses must have exhausted their initial PPP loan, or be on pace to spend the aid in order to qualify for another loan. The bill would also extend the loan application deadline for businesses from June 30 to Dec. 30 or later. A companion bill has been introduced in the House.
- Covered Period – The covered period for eligible expenses has increased from 8 to 24 weeks!This means that you have an extended period of time to accumulate payroll and other eligible expenses to meet the forgiveness requirements. This means that those potential bonuses and payroll adjustments at the end of your original 8-week period may not be necessary at this time.
- If your PPP loan was made prior to June 5th, you may elect to still use the prior 8-week period to determine loan forgiveness.
- Payroll Costs – The payroll expense requirements for use of PPP funds has decreased to 60% of your loan, where it was 75% previously. This allows for more of the funds to be used on the other qualifying expenses like rent, utilities, and mortgage interest.
- Using less than 60% of your funds on payroll costs will decrease the amount of other eligible expenses, which will decrease the total amount of forgiveness allowed.
- Application Deadline – If you have not yet applied for a PPP loan, the deadline is June 30th. If you’re considering applying, don’t wait until that date as your banker needs to submit the request to the SBA by June 30th.
Melissa Gragg, CVA, MAFF, CDFA
Expert testimony for financial and valuation issues
http://www.BridgeValuation.com
melissa@bridgevaluation.com
Cell: (314) 541-8163
Bridge Valuation Partners, LLC
Mark A Nicholas, CPA, CFE, CVA, CFF, MAFF
Managing Member
Financial Litigation Consultants, LLC
2712 McGraw Drive Bloomington, IL | 309-663-1353
3130 Sutton Blvd Maplewood, MO | 314-279-9223
3040 N University Ave, Decatur, IL | 217-877-6766
Email: mark.nicholas@flc-llc.com
Website: http://www.flc-llc.com
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