The SBA and Treasury Department Announce Total Forgiveness For All PPP Loans Of $50,000 Or Less

If you have a Paycheck Protection Program (PPP) loan of $50,000 or less, the SBA/Treasury Department announced the following:

  • There is now an easy loan forgiveness application for all Paycheck Protection Program (PPP) loans of $50,000 or less.
  • This decision streamlines the PPP forgiveness process to provide financial and administrative relief to America’s smallest businesses.
  • This decision will also allow lenders to process forgiveness applications far more swiftly.

SBA began approving PPP loan forgiveness applications and remitting forgiveness payments to PPP lenders for PPP borrowers on October 2, 2020. SBA will continue to process all PPP loan forgiveness applications in an expeditious manner.

PPP Loan Forgiveness Application.

If you have a PPP loan of $50,000 or less, we have listed several links below to use:

Get Your Loan Forgiveness Application In Soon.

Experts agree that all loan forgiveness applications should be completed as soon as possible as Form 3508S has a printed expiration date of October 31, 2020; however, a final loan forgiveness due date is not yet made public as of October 14, 2020.

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Follow DOL Guidance When Reducing Salaries During the Pandemic

The Basic Rules

Under the federal Fair Labor Standards Act (FLSA), an employer can generally reduce exempt employees’ regular salary for COVID-19-related reasons. However, the reduction cannot be made after the fact or based on the employer’s day-to-day or week-to-week needs, according to the DOL.

“In other words, exempt employees must be paid their predetermined salary for any workweek in which the employee provided any services,” said Lisa Reimbold, an attorney with Clark Hill in Los Angeles “As such, any pay reduction for an exempt employee can only apply to future workweeks.”

The FLSA requires most businesses to pay employees 1 1/2 times their regular hourly rate for hours worked in excess of 40 in a workweek, unless employees fall under an exemption. The most common exemptions are administrative, executive and professional, which are collectively called white-collar exemptions.

To read more, click here.

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Phase 4 Stimulus Package: 7 Topics Still Being Debated

Politicians in Washington have begun negotiations on the next round of COVID-19 stimulus. For business owners across the country, this will be a welcome relief and more. And with the prior stimulus measures expired, Congress will meet shortly to negotiate a new package.

#1. The PPP Will Likely Continue: The Paycheck Protection Program (PPP), the $669 billion forgivable loan program, might continue. Secondly, all PPP loans under $150,000 or $250,000 could be automatically forgiven.

#2. Local Communities Will Get A Boost: Low-income areas, as well as minority-owned businesses, might receive $50 billion to support small business local relief funds. The Cares Act initially provided $150 billion in federal aid to state and local governments across the country, some of which went toward grant funding for local businesses.

#3. More Tax Relief: Currently, PPP monies aren’t counted as taxable income. Because of that, the IRS ruled that a business wasn’t able to deduct traditional business expenses paid by PPP funds (if the loan was forgiven). A new bill, the Small Business Expense Protection Act, was introduced that would allow a business to take these deductions.

Additionally, another bill was introduced in May, JOBS Credit Act. The proposed JOBS Credit Act would make the following changes to the CARES Act employee retention credits:

The credits currently equal 50% of up to $10,000 in qualified wages that an eligible employer pays in a calendar quarter. The JOBS Credit Act would increase the amount of the credits to 80% of up to $15,000 in qualified wages per calendar quarter with a new annual cap of $45,000 in qualified wages. The maximum credit for wages paid to any employee would, therefore, increase from $5,000 under the CARES Act to $36,000 under the increased limits of the JOBS Credit Act.

Click Here To Read About The JOBS Credit Act.

#4. Stimulus Checks Sent To Individuals: The Heroes Act passed by the House supports another round of stimulus checks that the Cares Act authorized in March for millions of taxpayers:

Individuals earning under $75,000 would get $1,200.
Married couples with less than $150,000 in adjusted gross income would get $2,400.
An additional $1,200 for up to three dependents, regardless of age.

#5. Unemployment Benefits: The Cares Act’s enhanced unemployment insurance, which offered an additional $600 per week, expired in July. To avoid the issue of employees not wanting to come back to work, many lawmakers are considering a varied dollar value to better coordinate with a state’s unemployment insurance level (replace 80% to 90% of a worker’s former wages, up to a maximum federal benefit of an additional $400 per week).

#6. $1,500 Return To Work Bonus: The Paycheck Recovery Act, proposed in mid-May, offers someone who makes less than $40,100 annually, a $1,500 rehiring bonus upon return to work.

#7. Greater Liability Protection: Certain lawmakers want to see greater liability protection for employers. Although the details are unclear, the Phase 4 bill will allow for some form of safe harbor for companies that make a good-faith effort to follow public-health guidelines.

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COVID-19 Employer Resources and Compliance Toolkit

During these uncertain times, Miami Payroll Center is keeping up to date on all legislative and tax related responses to the COVID-19 crisis as they relate to small businesses and their employees. As additional information becomes available from related government agencies such as the Department of Labor and the IRS, this page will be updated accordingly.

On Wednesday, March 18th, the President signed the Families First Coronavirus Response Act to take effect on April 1, 2020 and will sunset on December 31, 2020. The Act provides for mandated paid emergency sick leave and paid family and medical leave for many workers. To offset wages paid under the program, employers will receive a tax credit. There are still several uncertainties, such as the timing of the credits to offset the payments required by employers. Many of the details for implementation are still unknown until individual government agencies, e.g. DOL, IRS, release their own guidance between now and April 1, 2020. As additional details are released for implementation, we will update the information on this page.

If you have specific questions as to how these changes may affect your business, please contact us at 305-273-4066.

Useful Links

COVID-19 Miami Payroll Center Published Resources

IRS Updates

The IRS has established a special section focused on steps to help taxpayers, businesses and others affected by the coronavirus. This page will be updated as new information is available.

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