Author Topic: SBA PPP and EIDL Small Business Loans (some money is forgivable)  (Read 536026 times)

Offline Deal Guy

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Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #1840 on: June 24, 2020, 06:37:54 PM »
Are general partners of a 1065 partnership eligible for ppp?
I've read about s-corps and schedule c, but where do they talk about partnerships?

Offline cgr

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Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #1841 on: June 24, 2020, 06:39:51 PM »
Are general partners of a 1065 partnership eligible for ppp?
I've read about s-corps and schedule c, but where do they talk about partnerships?

Yes, they're eligible. Do a search in the thread- it's been discussed.

Offline SwellCindy

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Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #1842 on: June 25, 2020, 11:01:43 AM »
I've come across this statement somewhere regarding EIDL loans:
"Not stated with the loan offering: Anything over 25000 is collateralized under 25000 is unencumbered."
Can anyone explain, and any add'l DP? Thank you.

Offline cgr

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Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #1843 on: June 25, 2020, 11:14:25 AM »
I've come across this statement somewhere regarding EIDL loans:
"Not stated with the loan offering: Anything over 25000 is collateralized under 25000 is unencumbered."
Can anyone explain, and any add'l DP? Thank you.

Basically anything other than inventory is collateral, and you need written SBA authorization to sell any collateral.

If you don’t have any collateral they’ll lend you the money anyway, though assets you acquire might become collateral as well, consult a lawyer.

FWIU, if you borrow $25k or less (per company?) they don’t do the collateral thingy.

Dont know what the SBA thinks when they are asking ppl to sign on the EIDL loan docs the following paragraph for the next 30 years....
Maybe they can just build a prison gate around USA or a Mexican wall...


LIMITS ON DISTRIBUTION OF ASSETS
·        Borrower will not, without the prior written consent of SBA, make any distribution of Borrower’s assets, or give
any preferential treatment, make any advance, directly or indirectly, by way of loan, gift, bonus, or otherwise, to
any owner or partner or any of its employees, or to any company directly or indirectly controlling or affiliated
with or controlled by Borrower, or any other company.

I am waiting on a tax attorney to give me an officially opinion. Off the record he said there is no way that was the intent of the SBA.

Offline cgr

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Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #1844 on: June 25, 2020, 11:16:15 AM »
Thanks to @aygart for pointing out the following:

As part of the CARES Act, the SBA is paying principal, interest, and loan fees for a six-month period on SBA 7(a), 504, or Microloans loans if the loan is disbursed prior to September 27, 2020. (this does not include EIDL or PPP loans)

There's still time to apply for these loans and receive 6 months of comped payments!

Offline cgr

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Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #1845 on: June 25, 2020, 11:48:23 AM »
Thanks to @aygart for pointing out the following:

As part of the CARES Act, the SBA is paying principal, interest, and loan fees for a six-month period on SBA 7(a), 504, or Microloans loans if the loan is disbursed prior to September 27, 2020. (this does not include EIDL or PPP loans)

There's still time to apply for these loans and receive 6 months of comped payments!

For a basic overview of 7(a) vs 504 vs Microloans see https://www.sba.gov/sites/default/files/articles/FY_2019_LoanQuickReference.pdf
« Last Edit: June 25, 2020, 11:52:32 AM by cgr »

Offline Deal Guy

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Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #1846 on: June 25, 2020, 12:10:34 PM »
Are ppp loans still being accepted today?
Are there funds left?

Offline shapsam

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Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #1847 on: June 25, 2020, 12:17:55 PM »
Are ppp loans still being accepted today?
Are there funds left?
Yes and yes.

Offline beeweegee

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Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #1848 on: June 25, 2020, 03:11:45 PM »
Your employees can definitely file if they're not receiving a paycheck.
As for yourself, if the total received divided by 24 weeks (assuming you're choosing this longer period) is less than $504 I think you should be able to claim no problem. I'm not sure if you can end-load the amount to only count as "earnings" for the last 2.5 months instead of over 24 weeks, although I can see good reason as to why you can make that claim since they only funded you for 2.5 months.
If one did this (claim unemployment while collecting PPP payments) due to the total being under the $504 or $713 maximum, how would you report the hours worked? When you certify, they ask how much you made but also how many hours you worked. Would you just use your general hourly rate and calculate how many hours that PPP payment would equal to? (NJ if it makes a difference.)

Offline TBD

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Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #1849 on: June 25, 2020, 03:20:39 PM »
Thanks to @aygart for pointing out the following:

As part of the CARES Act, the SBA is paying principal, interest, and loan fees for a six-month period on SBA 7(a), 504, or Microloans loans if the loan is disbursed prior to September 27, 2020. (this does not include EIDL or PPP loans)

There's still time to apply for these loans and receive 6 months of comped payments!
Anyone with more updates which loan has the shortest term, as 6 months of payments should include a large amount of principal in it also?

Offline TBD

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Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #1850 on: June 25, 2020, 03:23:46 PM »
IT SEEMS THAT THE SBA NUMBER NEEDS TO BE ISSUED BY JUNE 30 NOT THE ACTUAL LOAN DISBURSEMENT

Dear ......,
Per SBA guidance, lenders are not able to obtain PPP-SBA numbers after June 30th. If you have not supplied all required documentation to support your application, please do so as soon as possible. We will be working diligently to process all applications that are active and have supplied all required documentation.

Offline cgr

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Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #1851 on: June 25, 2020, 03:33:52 PM »
Anyone with more updates which loan has the shortest term, as 6 months of payments should include a large amount of principal in it also?

The chart give you the basics- Microloans generally have the shortest term but also has the smallest maximum loan...

You'd also want something with no prepayment penalty if you just want the loan for the 6 months of free money and then pay it all off once you need to start footing the bill...

Question- if I get a 50k microloan with a 6 month term, does that mean the SBA just gave me 50k straight up?

Offline SwellCindy

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Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #1852 on: June 25, 2020, 03:36:44 PM »
Can one use EIDL loan funds for payroll?

Offline TBD

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Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #1853 on: June 25, 2020, 03:41:31 PM »
Can one use EIDL loan funds for payroll?
Yes. but not the same payroll that you used PPP funds for

Offline SwellCindy

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Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #1854 on: June 25, 2020, 03:53:16 PM »
Yes. but not the same payroll that you used PPP funds for

Meaning payroll that covers different dates would be ok?
For ex, if the PPP funds were used to pay employees from April - May 25th, can I use EIDL loan funds from May 26 and on?

Thank you for your replies.

Offline TBD

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Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #1855 on: June 25, 2020, 03:55:26 PM »
Meaning payroll that covers different dates would be ok?
For ex, if the PPP funds were used to pay employees from April - May 25th, can I use EIDL loan funds from May 26 and on?

Thank you for your replies.
correct

Offline TBD

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Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #1856 on: June 25, 2020, 04:11:58 PM »
The chart give you the basics- Microloans generally have the shortest term but also has the smallest maximum loan...

You'd also want something with no prepayment penalty if you just want the loan for the 6 months of free money and then pay it all off once you need to start footing the bill...

Question- if I get a 50k microloan with a 6 month term, does that mean the SBA just gave me 50k straight up?
https://www.grsm.com/publications/2020/borrowers-lenders-sba7a-504-loans-cares-act

Remember, traditional SBA 7(a) and 504 loans require that borrowers meet the “credit elsewhere test.”  That test requires a showing that the borrower does not have the ability to obtain some or all of the requested loan funds from alternative sources without causing undue hardship.

Offline JACKBLUE

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Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #1857 on: June 25, 2020, 04:21:31 PM »
Applied for a few loans under same email, when i open my account i can only see 1 loan, how do i add all others?
If you used the same email for multiple applications and it doesn't show up in your account, you can call SBA to manually add them.

Offline cgr

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Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #1858 on: June 25, 2020, 04:24:36 PM »
https://www.grsm.com/publications/2020/borrowers-lenders-sba7a-504-loans-cares-act

Remember, traditional SBA 7(a) and 504 loans require that borrowers meet the “credit elsewhere test.”  That test requires a showing that the borrower does not have the ability to obtain some or all of the requested loan funds from alternative sources without causing undue hardship.

Wouldn't the fact that they're offering to comp 6 moths automatically make them the best deal out there?

Offline Dan

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Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #1859 on: June 25, 2020, 04:30:56 PM »
Haven't been following PPP updates, but is it correct that if you take a 24 week period, owner compensation is capped at $20,833 and employee compensation is capped at $46,154?
Can you take out a bigger loan or that's still capped at 2.5x salary (capped at 100K)?
Any other major updates?
Save your time, I don't answer PM. Post it in the forum and a dedicated DDF'er will get back to you as soon as possible.