On December 21, 2020, Congress passed a coronavirus stimulus package that includes an additional $284 billion of Paycheck Protection Program funding of financial relief in the form of tax credits and loan forgiveness for borrowers who meet certain criteria. Many business owners look to DLA for help navigating the complexities of the loan application process, implementing proven cash management strategies and preparing audit ready documentation that supports loan forgiveness.
- PPP Loan Applications
- Navigate the complexities of the PPP loan process
- Accurately identify all qualified payroll expenses to maximize loan
- Certify your application with confidence
- Cash Flow Solutions
- Cost savings solutions
- Working capital improvement strategies
- Strategic planning and cash flow modeling
- Monitor actual spending relative to forgiveness criteria
- PPP Loan Forgiveness
- Custom reporting aligned to forgiveness applications
- Analyze incurred cost to accounts and identify qualified expenses
- Audit ready documentation
PPP Loan Applications
- Eligibility Criteria and What’s Available:
- All Applicants:
- 25% revenue decline and economic need
- Loan amount based on 2.5 times payroll costs
- First-time Applicants:
- 500 or fewer employees
- Loan capped at $10 million
- Second-time Applicants:
- 300 or fewer employees
- Loan capped at $2 million
- Potential 2nd Draw against PPP-1
- All Applicants:
- Qualified Expenses:
- Payroll costs
- Mortgage interest, rent and utility
- Covered worker protection and facility modification expenditures
- Covered property damage
- Covered supplier costs
- Application Deadline
- March 31, 2021
- Early application is recommended
Cash Flow Solutions
- How good is my cash flow plan?
- Have you analyzed your costs and identified opportunities to reduce cost?
- Do you have a plan to free up cash tied up in account receivable and inventory?
- Do you have a cash flow plan that gets you to where you need to be?
- Have you stress tested the underlying cash flow assumptions?
- How will PPP impact my tax bill?
- Qualified PPP expenses are deductible
- PPP forgiveness is not taxable
- Employee Retention Credits can offset payroll taxes
- Certain meals are now 100% deductible
- Partnerships and S-corps may receive a stepped up basis on PPP forgiveness
PPP Loan Forgiveness
- Borrowers can apply for forgiveness any time up to the maturity date of the loan
- Understanding what qualifies as payroll cost is key to maximizing loan forgiveness: the 8 week “Covered Period” and the 24 week “Alternate Payroll Covered Period”
- Calculations may change if there have been reductions in staff or pay rates
- Applicants who borrowed under first PPP may qualify for a second draw
- Certifications made by borrowers are legally binding and potentially subject to audit
- Organized documentation will facilitate the SBA forgiveness application
Scott Levy, CPA, CGMA
Partner, New England Practice and Accounting Advisory Group Leader
Jesse Liszkiewicz, CPA
Director – Accounting Advisory
Managing Director – Accounting Advisory
John Leydon, CPA
Outsourced CFO and Controller Services Consultant, Accounting Advisory
Contact us today for questions and more information.