The SBA Payroll Protection Program (PPP) Loan Criteria For Forgiveness Are Changing…

The ** UPDATED** SBA PPP Payroll Tracker will help you remain in compliance with the forgiveness terms.

If your business received funds, you must track the spending in order to have the loan amount forgiven.

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$10B

EIDL

$350B

SBA PPP

$600B

MSELF

The UPDATED Excel Payroll Tracker is $99. The template can be purchased & downloaded below.

Existing clients of TGG Accounting should email their team for their FREE Payroll Tracker link.

The UPDATED PPP Payroll Tracker will guide you through the necessary steps to keep your SBA PPP funds in compliance.

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HERE’S WHAT CHANGED:

  • Calculator Tab
    • Added: Payroll Frequency and Alternative Covered Period. For weekly or biweekly payroll employers, you can elect to start the 8 weeks of payroll on the first day of the next payroll period after funding. This will align the payroll for the incurred amounts to a full additional week.
      • NOTE: The alternative date only applies to the payroll costs.  Other covered costs start on the day of funding.
    • Changed: the calculator to calculate each line per the forgiveness application. They are labeled Line 1., Line 2., etc. to align to the application
    • Changed: the reduction modifiers. The previous versions calculated independently for the 75.0% wage and the FTEs. SBA calculation is 75.0% first then subtotal times the FTE modifier
    • Changed: Forgiveness calculation to the lessor of 1. Modified total (total spend less the FTE or wage reduction modifiers), total loan amount, or payroll costs divided by 75.0%
    • Added: Schedule A Tab. This has all the inputs for schedule A. No inputs on this tab unless company elects to use alternative average FTE (seasonal employers only)
    • Added: Schedule A Tables. This is table 1, table 2, and owner comp. Enter EE IDs on the appropriate tables and payroll/FTE data will pull in. These should be able to PDF and attach to application.
      • NOTE: this MUST be completed to feed into the calculator and Schedule A.
  • Payroll Tab
    • Added: Hire & Term Dates to EE information
      • Hire dates to use as reference for table 1 vs table 2 determination.
      • Term dates will pull into the FTE tab for the FTE reduction testing.
    • Changed: 75.0% Ave to calculate average hourly rate for Q1 vs the average weekly pay in previous version.  For salaried individuals use standard 40 hours/week in hours for payroll average and FTE tab.
    • Added: Incurred Payroll column. Enter the week of the incurred payroll that is paid after the covered period to pull the data into the correct week on cash flow.
    • Added: Hourly and Wage reduction and Safe Harbor Test in columns Z-AJ. Safe Harbor test data is only necessary to enter for individuals that fall below the 75.0% test.  Enter as an hourly rate for both hourly and salary employees. This will test ALL employees, but will only effect employees on Table 1. The determination of table 1 vs table 2 is based on 2019 compensation levels that are not in any other calculations, so it is not being limited on this schedule.
    • Changed: Eligible payroll subtotal to be a manual weekly adjustment. The only thing this feeds into is the cash flow report.
    • Deleted: $100k & 75.0% prorations per person. The prorated $100k is in the tables. The reduction is now in the box 3 column of the reduction testing.
  • FTE Tab
    • Added: FTE methodology. Company has the choice to calculate by rounding to the nearest tenth or 0.5.
      • NOTE: Companies will likely need to recalculate historical benchmarks to match the current methodology selected.
    • Added: Safe Harbor test inputs.
    • Added: Status at End of Period. This is pulled off the payroll tab for the term date
    • Added: Term Reason. Some termination reasons qualify for reduction exceptions.
    • Added: Column for hours in the incurred/unpaid period
    • Added: Testing for the reduction exceptions. Company should evaluate for anyone that is less than normal hours compared to Q1. If there is a qualifying reason for reduction, the company must not have rehired for that position during the period to qualify for the exception.
  • Cash Flow
    • Added: Columns for qualifying pay-outs after the 8-weeks for cost incurred but not paid until the normal schedule after the covered period.

The TGG Payroll Tracker is meant to be used by qualified accounting professionals and business owners with financial accumen.  The tool works as well as the information (and veracity of information) that is put into the tool.  TGG is secure in the validity of the tool but cannot take responsibility for the way in which any person or business uses the tool.  Please reach out to our team if you need help tracking your accounting.

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SBA PPP Loan Criteria

SBA PPP Loans are forgivable:

  • If the business uses 75% of the loan amount to pay payroll expenses during the 8 week period following receipt of the funds.
  • If the business uses 25% for operating expenses.
  • If the business can verify the use of funds.

Strategies to ensure forgiveness:

  1. Use the TGG SBA PPP Tracker tool.
  2. Place funds in a separate account.
  3. Return funds that are not used in the allotted time period for the appropriate use.
    1. i.e. For a loan of $100K, $75K must be used in the 8 weeks to cover payroll.  If the business only has $60K in payroll costs in those 8 weeks, they should either return the money or assume that portion of the loan, $15K will be un-forgiven.  Non-forgiven loans revert to the terms of the loan at 2 years, 1% interest with 6 months deferred payments.
  4. Keep impeccable records of expenses. Bank records, expense reports, physical receipts.

US Banks originate the SBA PPP Loans.

Most banks will only accept loan applications from existing customers.

A few exceptions can be found here :https://thinksba.com/cv/

Download the SBA Fact Sheet

Read the entire Federal Reserve Press Release HERE: https://www.federalreserve.gov/newsevents/pressreleases/monetary20200409a.htm

Other Stimulus Resources

Have you applied for the MSELF Loan?

The Main Street Lending Program will enhance support for small and mid-sized businesses that were in good financial standing before the crisis by offering 4-year loans to companies employing up to 10,000 workers or with revenues of less than $2.5 billion. Principal and interest payments will be deferred for one year. Eligible banks may originate new Main Street loans or use Main Street loans to increase the size of existing loans to businesses.

GET THE MSELF LOAN ORGANIZER

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