Author Topic: SBA PPP and EIDL Small Business Loans (some money is forgivable)  (Read 535699 times)

Offline ShimshonK

  • Dansdeals Platinum Elite + Lifetime Silver Elite
  • *****
  • Join Date: Nov 2018
  • Posts: 550
  • Total likes: 148
  • DansDeals.com Hat Tips 3
    • View Profile
Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #3000 on: January 21, 2021, 08:16:06 PM »
Any update on these open questions?
Bump. And if you might get some answers sometime in the future still, please let me know.

Offline cgr

  • Dansdeals Presidential Platinum Elite
  • ********
  • Join Date: Aug 2017
  • Posts: 4377
  • Total likes: 1318
  • DansDeals.com Hat Tips 7
    • View Profile
Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #3001 on: January 21, 2021, 08:48:02 PM »
Bump. And if you might get some answers sometime in the future still, please let me know.

I suggest you first check if you'd be eligible even if these rules aren't in your favor. It might take a while to get an answer on this...

Offline cgr

  • Dansdeals Presidential Platinum Elite
  • ********
  • Join Date: Aug 2017
  • Posts: 4377
  • Total likes: 1318
  • DansDeals.com Hat Tips 7
    • View Profile
Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #3002 on: January 21, 2021, 09:05:56 PM »
If anyone needs a bank that processes PPP where their married name (tax return) doesn't match their ID, I have a bank that clears it if you upload your marriage license.

I also have a bank that processes loans for as low as $100 (might be less but this is the lowest one I've seen).

Feel free to PM me.

Offline ShimshonK

  • Dansdeals Platinum Elite + Lifetime Silver Elite
  • *****
  • Join Date: Nov 2018
  • Posts: 550
  • Total likes: 148
  • DansDeals.com Hat Tips 3
    • View Profile
Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #3003 on: January 21, 2021, 09:34:00 PM »
I suggest you first check if you'd be eligible even if these rules aren't in your favor. It might take a while to get an answer on this...
I'd be eligible under my Schedule C biz alone, but would not be eligible if need to count total personal income (from other businesses) for the decrease.
If I don't want to wait, I can apply for the loan, and just sort this out before applying for forgiveness?

Offline cgr

  • Dansdeals Presidential Platinum Elite
  • ********
  • Join Date: Aug 2017
  • Posts: 4377
  • Total likes: 1318
  • DansDeals.com Hat Tips 7
    • View Profile
Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #3004 on: January 21, 2021, 09:37:17 PM »
I'd be eligible under my Schedule C biz alone, but would not be eligible if need to count total personal income (from other businesses) for the decrease.
If I don't want to wait, I can apply for the loan, and just sort this out before applying for forgiveness?
You need to certify the reduction even if you don't have to provide proof right now.

Offline ShimshonK

  • Dansdeals Platinum Elite + Lifetime Silver Elite
  • *****
  • Join Date: Nov 2018
  • Posts: 550
  • Total likes: 148
  • DansDeals.com Hat Tips 3
    • View Profile
Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #3005 on: January 22, 2021, 01:48:09 AM »
Spoke to some experts and cleared it up.
It's gross receipts, not gross income, so COGS should be excluded (or added back to gross income).

https://home.treasury.gov/system/files/136/Second-Draw-PPP-Loans--How-Calculate-Revenue-Reduction-Maximum-Loan-Amounts-Including-Documentation-Provide1192021.pdf
See page 4, question 5, for very exact instructions.
It seems like Kabbage/KServicing is saying otherwise, unless I understood you wrong.
On their application -
Quote
How do I calculate gross receipts?
The IRS defines "gross receipts" as "the total amounts the organization received from all sources during its annual accounting period, without subtracting any costs or expenses."

Offline ShimshonK

  • Dansdeals Platinum Elite + Lifetime Silver Elite
  • *****
  • Join Date: Nov 2018
  • Posts: 550
  • Total likes: 148
  • DansDeals.com Hat Tips 3
    • View Profile
Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #3006 on: January 22, 2021, 02:30:37 AM »
You need to certify the reduction even if you don't have to provide proof right now.
I'm somewhat surprised there's no clarity on this. There are many folks out there with multiple businesses that this is applicable to.

I figured to check what questions are asked by the bank. So I began filling out a second draw application on Kabbage (where most of the info was pre-filled from the first draw loan). There is a question asking if the applicant is affiliated with any other businesses, and when selecting yes, they ask a few additional questions relating to that (see first screenshot below).
After answering those questions, it goes on to show that I should be approved for a loan in the same amount as the first draw.
However, one of the checkbox statements says "the applicant has realized a reduction..." (see second screenshot below).
So based on that wording, it's not clear that it's fine to use each business individually.
Even if this is a real issue (having other businesses) - if they're using a date of 2/15/20 when the business must have been opened by, it's only fair that should also be the date they look if the applicant had other businesses, no?






Offline TBD

  • Dansdeals Lifetime Platinum Elite
  • *******
  • Join Date: Nov 2014
  • Posts: 1316
  • Total likes: 206
  • DansDeals.com Hat Tips 1
    • View Profile
  • Location: United States
Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #3007 on: January 22, 2021, 02:34:38 AM »
It seems like Kabbage/KServicing is saying otherwise, unless I understood you wrong.
On their application -
Both are saying the same just @cgr describes it differently.....   COGS should be excluded because its already included in the gross receipts and that's why Kabbage writes not to deduct COGS from gross receipts


Offline ShimshonK

  • Dansdeals Platinum Elite + Lifetime Silver Elite
  • *****
  • Join Date: Nov 2018
  • Posts: 550
  • Total likes: 148
  • DansDeals.com Hat Tips 3
    • View Profile
Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #3008 on: January 22, 2021, 02:49:25 AM »
Both are saying the same just @cgr describes it differently.....   COGS should be excluded because its already included in the gross receipts and that's why Kabbage writes not to deduct COGS from gross receipts
IDK, their wording definitely makes it seem like it's total revenue without ever reducing for COGS.

Offline cgr

  • Dansdeals Presidential Platinum Elite
  • ********
  • Join Date: Aug 2017
  • Posts: 4377
  • Total likes: 1318
  • DansDeals.com Hat Tips 7
    • View Profile
Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #3009 on: January 22, 2021, 07:43:58 AM »
IDK, their wording definitely makes it seem like it's total revenue without ever reducing for COGS.

I think the confusion here is because of the accounting terms used.
Gross Receipts = just topline revenue
Gross Income= topline revenue less COGS

If you're looking at Gross Receipts don't add or subtract anything to it.
If you're looking at Gross Income add back in the COGS.

Better?

Offline cgr

  • Dansdeals Presidential Platinum Elite
  • ********
  • Join Date: Aug 2017
  • Posts: 4377
  • Total likes: 1318
  • DansDeals.com Hat Tips 7
    • View Profile
Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #3010 on: January 22, 2021, 07:46:32 AM »
Even if this is a real issue (having other businesses) - if they're using a date of 2/15/20 when the business must have been opened by, it's only fair that should also be the date they look if the applicant had other businesses, no?

Not necessarily. The SBA has a full page in the IFR about acquisitions and it talks about later acquisitions and earlier acquisitions.

Offline shapsam

  • Dansdeals Presidential Platinum Elite
  • ********
  • Join Date: Feb 2017
  • Posts: 3017
  • Total likes: 637
  • DansDeals.com Hat Tips 11
    • View Profile
Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #3011 on: January 22, 2021, 11:31:23 AM »
Does it make sense that the Bluevine forgiveness application is not out yet? This is what it says when logged in:
"Our PPP loan forgiveness application will be available soon. Read our article for more information about the requirements."

Offline AsherO

  • Global Moderator
  • Dansdeals Lifetime 30K Presidential Platinum Elite
  • **********
  • Join Date: May 2008
  • Posts: 30533
  • Total likes: 7831
  • DansDeals.com Hat Tips 79
    • View Profile
  • Location: NYC
Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #3012 on: January 22, 2021, 11:43:29 AM »
Does it make sense that the Bluevine forgiveness application is not out yet? This is what it says when logged in:
"Our PPP loan forgiveness application will be available soon. Read our article for more information about the requirements."

Given that:
1. The treasury just recently released the latest forgiveness forms
2. BlueVine is probably prioritizing PPP 2 over forgiveness
3. BlueVine apparently hasn't yet opened PPP 2 to all borrowers (1st draw, if they ever will reopen that, and 2nd draw for some banks/borrowers)

It's likely gonna be a while. Kindly CMIIW, I'm a BlueVine borrower too and would love to know that forgiveness is done with and out of the way for me.
100% of Likes will be donated to support our brothers and sisters in Eretz Yisrael

Offline AsherO

  • Global Moderator
  • Dansdeals Lifetime 30K Presidential Platinum Elite
  • **********
  • Join Date: May 2008
  • Posts: 30533
  • Total likes: 7831
  • DansDeals.com Hat Tips 79
    • View Profile
  • Location: NYC
Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #3013 on: January 22, 2021, 11:51:13 AM »
Given that:
1. The treasury just recently released the latest forgiveness forms
2. BlueVine is probably prioritizing PPP 2 over forgiveness
3. BlueVine apparently hasn't yet opened PPP 2 to all borrowers (1st draw, if they ever will reopen that, and 2nd draw for some banks/borrowers)

It's likely gonna be a while. Kindly CMIIW, I'm a BlueVine borrower too and would love to know that forgiveness is done with and out of the way for me.

Apparently it varies by lender (BlueVine is a platform, not a lender). Your loan docs from BlueVine (Docusign) should tell you who the actual lender is.

For instance, it seems CrossRiver via BlueVine borrowers can request forgiveness on a platform called Scratch.
100% of Likes will be donated to support our brothers and sisters in Eretz Yisrael

Offline yitz1000

  • Dansdeals Gold Elite
  • ***
  • Join Date: Aug 2015
  • Posts: 210
  • Total likes: 21
  • DansDeals.com Hat Tips 0
  • Gender: Male
    • View Profile
  • Location: Brooklyn NY
Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #3014 on: January 22, 2021, 12:50:58 PM »
Apparently it varies by lender (BlueVine is a platform, not a lender). Your loan docs from BlueVine (Docusign) should tell you who the actual lender is.

For instance, it seems CrossRiver via BlueVine borrowers can request forgiveness on a platform called Scratch.

Correct, and although Scratch allows you to apply for Forgiveness now, they display this message:

ATTENTION: YOU MAY BENEFIT FROM WAITING TO SUBMIT THIS FORGIVENESS APPLICATION. CHANGES ARE COMING TO THE PPP FORGIVENESS PROCESS THAT MAY MAKE YOU ELIGIBLE FOR MORE FORGIVENESS.
A new law was recently enacted that includes changes to the PPP forgiveness application. You may benefit from waiting to submit your application so you can take advantage of the upcoming updates, which are not available in today’s forgiveness application:

New categories of expenses will be eligible for forgiveness, including certain operational costs (such as business software), certain supplier costs, COVID-19 worker protection costs (such as personal protective equipment or changes to your business space for safety), and property damage costs not covered by insurance. Read more about newly forgivable expenses here.
The forgiveness application will be simplified for loans of $150,000 and under.
Borrowers will be able to change their covered period to end any day that’s between 8 and 24 weeks after their loan disbursement date.

If you would like to take advantage of these changes, we recommend you wait to submit your forgiveness application until the updated application is released in February 2021. You’ll receive a notification over email when this application is available.

If you don’t expect the above changes to affect your forgiveness amount, it’s okay to go ahead and submit your forgiveness application now.

Remember that your PPP loan will not enter repayment until 10 months after the end of your covered period. You can apply for forgiveness at any point before the maturity date of your loan.

Offline AsherO

  • Global Moderator
  • Dansdeals Lifetime 30K Presidential Platinum Elite
  • **********
  • Join Date: May 2008
  • Posts: 30533
  • Total likes: 7831
  • DansDeals.com Hat Tips 79
    • View Profile
  • Location: NYC
Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #3015 on: January 22, 2021, 01:21:25 PM »
Correct, and although Scratch allows you to apply for Forgiveness now, they display this message:

ATTENTION: YOU MAY BENEFIT FROM WAITING TO SUBMIT THIS FORGIVENESS APPLICATION. CHANGES ARE COMING TO THE PPP FORGIVENESS PROCESS THAT MAY MAKE YOU ELIGIBLE FOR MORE FORGIVENESS.
A new law was recently enacted that includes changes to the PPP forgiveness application. You may benefit from waiting to submit your application so you can take advantage of the upcoming updates, which are not available in today’s forgiveness application:

New categories of expenses will be eligible for forgiveness, including certain operational costs (such as business software), certain supplier costs, COVID-19 worker protection costs (such as personal protective equipment or changes to your business space for safety), and property damage costs not covered by insurance. Read more about newly forgivable expenses here.
The forgiveness application will be simplified for loans of $150,000 and under.
Borrowers will be able to change their covered period to end any day that’s between 8 and 24 weeks after their loan disbursement date.

If you would like to take advantage of these changes, we recommend you wait to submit your forgiveness application until the updated application is released in February 2021. You’ll receive a notification over email when this application is available.

If you don’t expect the above changes to affect your forgiveness amount, it’s okay to go ahead and submit your forgiveness application now.

Remember that your PPP loan will not enter repayment until 10 months after the end of your covered period. You can apply for forgiveness at any point before the maturity date of your loan.

I guess I didn't realize they still haven't implemented the simplified version. But that makes sense, Planning, compliance, and IT all need to work together to implement it and make sure all their bases are covered. Then it goes to QA/testing, eventually some executive has to sign off on it.
100% of Likes will be donated to support our brothers and sisters in Eretz Yisrael

Offline ShimshonK

  • Dansdeals Platinum Elite + Lifetime Silver Elite
  • *****
  • Join Date: Nov 2018
  • Posts: 550
  • Total likes: 148
  • DansDeals.com Hat Tips 3
    • View Profile
Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #3016 on: January 23, 2021, 08:06:37 PM »
I think the confusion here is because of the accounting terms used.
Gross Receipts = just topline revenue
Gross Income= topline revenue less COGS

If you're looking at Gross Receipts don't add or subtract anything to it.
If you're looking at Gross Income add back in the COGS.

Better?
Ok, now I understand, thanks.

Offline TBD

  • Dansdeals Lifetime Platinum Elite
  • *******
  • Join Date: Nov 2014
  • Posts: 1316
  • Total likes: 206
  • DansDeals.com Hat Tips 1
    • View Profile
  • Location: United States
Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #3017 on: January 23, 2021, 09:46:47 PM »
. In addition, borrowers obtaining a second draw PPP loan of more than $150,000 must submit the loan forgiveness application for the first draw PPP loan before applying for the second draw PPP loan.

https://www.lanepowell.com/Our-Insights/218520/SBA-Guidance-for-PPP-Loan-Forgiveness-Incorporates-Changes-From-the-Year-End-2020-Recovery-Bill

Offline cgr

  • Dansdeals Presidential Platinum Elite
  • ********
  • Join Date: Aug 2017
  • Posts: 4377
  • Total likes: 1318
  • DansDeals.com Hat Tips 7
    • View Profile
Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #3018 on: January 23, 2021, 10:34:42 PM »
. In addition, borrowers obtaining a second draw PPP loan of more than $150,000 must submit the loan forgiveness application for the first draw PPP loan before applying for the second draw PPP loan.

https://www.lanepowell.com/Our-Insights/218520/SBA-Guidance-for-PPP-Loan-Forgiveness-Incorporates-Changes-From-the-Year-End-2020-Recovery-Bill

What's their source?
Here's the latest IFR and I couldn't find that requirement anywhere. All it says is that borrowers with loans of $150k+ must apply for First Draw forgiveness before or together with Second Draw forgiveness.
https://home.treasury.gov/system/files/136/PPP--IFR--Loan-Forgiveness-Requirements-Loan-Review-Procedures-Amended-Economic-Aid-Act-1192021.pdf

Offline YitzyS

  • Dansdeals Lifetime Presidential Platinum Elite
  • *********
  • Join Date: Jan 2015
  • Posts: 5552
  • Total likes: 13696
  • DansDeals.com Hat Tips 34
  • Gender: Male
    • View Profile
  • Location: Lakewood, NJ
Re: SBA PPP and EIDL Small Business Loans (some money is forgivable)
« Reply #3019 on: January 24, 2021, 11:56:26 AM »
Approved!