Covid relief loans, such as Economic Disaster Loans (EIDL) and Paycheck Protection Plan (PPP) loans, have provided millions of businesses with essential financing. But with hundreds of pages of ever-changing advice on these loans and grants, it’s no surprise that many business owners find themselves confused and unsure where to turn for help with their questions. PPP and EIDL.
At Nav, we’ve written extensively about the Paycheck Protection Program and the EIDL, and as a result, we’ve answered hundreds of questions about these programs. Some of these questions are easy to answer, for example:
“Can I get a PPP loan if I am an independent contractor? “
Answer: Yes, based on the income declared on your Schedule C tax form.
“How do I apply for the Targeted EIDL scholarship?” “
Answer: You must wait for the SBA to send you an email to apply. You will only receive an invitation if you have applied for an EIDL scholarship in 2020.
Others may be more complicated, like the one we recently received on our blog:
“I own 100% of an S corporation and take a paycheck. I am trying to apply for the 2nd PPP loan, but the bank is asking for Q1 2020 form 941 to show the number of employees and see if I was in business. I was in business for the whole of 2020, but I did not take a paycheck for the first quarter of 2020, so I declared a zero on the 941 form. Since there was no pay for January-March 2020, but I am using my 2019 numbers to apply, this zero return disqualifies me for the 2nd PPP round? My gross sales have dropped by the required 25%. “
(Note: We don’t have all the answers. For this question, we’ve encouraged our reader to explore some of the options below.)
If you’re looking for answers to your EIDL and PPP questions, here are five places to get help:
1. Your lender
If you have submitted your PPP loan application, specific questions regarding your application should be directed to your lender. Of course, most lenders face massive loan volumes and some are more responsive than others to questions from borrowers.
Try to be patient and respond to requests for additional information, even if it seems redundant. (They also deal with changing guidelines.) Your lender will ultimately be responsible for driving your application throughout the process.
If you have applied for an EIDL or the Targeted EIDL advance, questions should be directed to the Small Business Administration (SBA) as they make these loans and grants.
2. Your local SBA office
The SBA has offices across the country, and many have held events to answer questions from small business owners about Covid loans and other relief programs. These offices can be a useful source of information and assistance if you have questions about PPPs and EIDL. Find your local SBA office here.
3. SBA resource partners
Taxpayer money helps fund valuable programs that can come in handy as you try to navigate the economic downturn. SBA resource partners include:
- Small Business Development Centers (SBDC)
- SCORE (volunteer mentors)
- Women’s Business Centers (WBC)
- Business Outreach Centers for Veterans (VBOC)
The people involved in these organizations have worked tirelessly over the past year to help small business owners take advantage of federal assistance programs. As an added bonus, they may be able to direct you to state or local aid and grant programs. Find your local SBA resource partners here.
4. Your accounting professional
There are several reasons why accounting professionals can be crucial in helping you secure a Covid relief loan or grant:
- To apply for a PPP or EIDL loan, you must have completed your tax returns.
- Your claim may require calculations (such as income reductions) that you may not be comfortable calculating on your own.
- PPP forgiveness requests can be incredibly difficult, even for the most detail-oriented entrepreneur. Your accountant or accountant can help you or refer you to someone who can. (Accounting professionals may have access to forgiveness calculator software.)
Realize that this is already an insanely busy year for accountants and bookkeepers, so try to be understanding and patient with your requests for help. Organizing your financial information will allow them to help you more effectively, so make sure you’ve done your part!
5. Other business owners
Shortly after the passage of the CARES Act in March 2020, Nav created a Facebook group for business owners to ask questions and share their experiences with EIDL and PPP. It exploded. Business Lending and Financing Information Center – PPP, EIDL and more Facebook now has nearly 20,000 members, many of whom share their experiences with these programs.
Of course, you have to be extra careful when following the advice of a Facebook post, but one thing many business owners have found helpful about this community is to hear from others about their progress in this community. obtaining financing through these stimulus programs.
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