Dear WZ Clients, Business Associates and Friends,

Lawmakers want to fix a mix-up in the economic relief CARES Act laws from March that could cost small businesses $120 billion in taxes.

Congressional members from both parties said businesses taking loans from the Paycheck Protection Program (PPP) should be allowed to deduct related expenses, like payroll, from taxes.

That provision is not in the current Republican draft for the next proposal. That could leave millions of small businesses without a lifeline for their next tax returns. Treasury Secretary Steven Mnuchin was opposed to the deductions, according to a source.  The Treasury Department’s position is that allowing deductions could serve as a kind of double benefit, allowing businesses to claim deductions and get tax-free income.

The issue comes from how the CARES Act was originally constructed, allowing for the PPP loans to be forgiven so long as businesses use them mostly for paying employees, with the forgiven loans not counting as taxable income. But the law doesn’t specify if ordinary tax deductions for the same expenses are allowed – though in late April, the Treasury Department and IRS determined that the businesses couldn’t also take deductions due to tax laws prohibiting double benefits.

In May, the House passed a bill that would allow for the deductions, with support from numerous lawmakers and the backing of the National Federation of Independent Businesses. All were disappointed to see the idea absent from the GOP bill.

The deductions, according to analysts, could help businesses use current losses against income from years past in order to claim refunds.

AS ALWAYS, WAGNER & ZWERMAN IS HERE TO ANSWER ALL OF YOUR QUESTIONS AND CONCERNS. WE ARE ALL IN THIS TOGETHER.

STAY SAFE AND HEALTHY

** IF YOU HAVE MISSED ANY PREVIOUS WZ COMMUNICATION IN REGARDS TO COVID-19, PLEASE REFER TO OUR WEBSITE

Best,

WZ Partners

Dear WZ Clients, Business Associates and Friends,

On July 27, 2020, U.S. Senator Marco Rubio (R-FL), Chairman of the Senate Committee on Small Business and Entrepreneurship, and Senator Susan Collins (R-ME), a senior member of the Senate Committee on Appropriations and Committee on Health, Education, Labor, and Pensions, introduced the Continuing Small Business Recovery and Paycheck Protection Program Act, a federal relief package that builds on the success of the bipartisan Paycheck Protection Program (PPP) and other small business relief programs in the Coronavirus Aid, Relief, and Economic Security (CARES) Act (P.L. 116-36).

The package aims to ensure small businesses, including minority-owned firms and those in underserved communities, have the necessary resources to weather the COVID-19 pandemic. The bill would allow the most severely affected small businesses to receive a second PPP loan. It would also create a new long-term recovery loan program, which would provide working capital to industries that have been hardest hit by the COVID-19 pandemic. The nearly $60 billion long-term recovery loan program would target low-income communities, minority-owned, and seasonal businesses.

A section by section is available here and a one pager here.

The Continuing Small Business Recovery and Paycheck Protection Program Act would:

• Long-term Recovery Sector Loans: Create a guaranteed long-term, low-interest working capital product by improving the terms of 7(a) loans for seasonal businesses and businesses located in low-income communities. The loans would equal 2x the borrowers’ annual revenues, up to $10 million, with a maturity of up to 20 years at an interest rate that is fixed at one percent to the borrower. The bill would allow businesses with 500 employees or fewer and have seen their revenues decline by 50 percent or more in the first or second quarter this year compared to the same quarter last year.

• PPP Second Draw Loans: Provide funds to allow the hardest-hit small employers – those that have seen their revenues decline by 50 percent or more in the first or second quarter this year compared to the same quarter last year – to receive a second PPP loan. The bill would limit these second forgivable loans to entities with 300 or fewer employees and create an additional set aside of funds for businesses with 10 or fewer employees to ensure equitable access to forgivable loans. The bill includes a $10 billion set aside for community lenders to access second draw funds.

• PPP Programmatic Improvements: Allow businesses to utilize forgivable PPP funds for personal protective equipment for workers, adaptive investments needed for businesses to operate safely amid the COVID-19 pandemic, and additional expenses. It would also simplify the forgiveness application and documentation requirements for smaller loans under $150,000. Additionally, it would further expand eligibility to certain 501(c)(6) organizations with 300 employees or fewer as well as favorable loan calculations for farmers and ranchers.

• Small Business Growth and Domestic Production Investment Facility: Provides for the provision of $10 billion in long-term debt with equity features to registered SBA Small Business Investment Companies (SBICs) that invest in small businesses with significant revenue losses from COVID-19, manufacturing startups in the domestic supply chain, and in low-income communities. Establishes return participation for the SBA in order to recoup the one-time cost of the investment.

AS ALWAYS, WAGNER & ZWERMAN IS HERE TO ANSWER ALL OF YOUR QUESTIONS AND CONCERNS. WE ARE ALL IN THIS TOGETHER.

STAY SAFE AND HEALTHY

** IF YOU HAVE MISSED ANY PREVIOUS WZ COMMUNICATION IN REGARDS TO COVID-19, PLEASE REFER TO OUR WEBSITE

Best,

Dear Clients, Business Associates and Friends:

M&T Bank is accepting applications under the Main Street Lending Program for profit organizations. Organizations may apply for one of three loan facilities and the loans have somewhat different characteristics.

The “New” and “Priority” facilities make new loans available to borrowers and the “Expanded” facility leverages an existing loan facility (term loan or revolving credit facility) to provide additional credit to borrowers. An eligible borrower may only participate in one of the Main Street Lending Program facilities.

For more information regarding the program details, click on the link below:

M&T Main Street Lending Program

AS ALWAYS, WAGNER & ZWERMAN IS HERE TO ANSWER ALL OF YOUR QUESTIONS AND CONCERNS. WE ARE ALL IN THIS TOGETHER.

** IF YOU HAVE MISSED ANY PREVIOUS WZ WEBINARS OR COMMUNICATION IN REGARDS TO COVID-19, PLEASE REFER TO OUR WEBSITE

Best,

WZ Partners

Dear Clients, Business Associates and Friends:

Small businesses that still need quick cash to help them through the Coronavirus pandemic can no longer count on the loan advance program from the Small Business Administration.

The coveted program, which provided immediate relief to businesses that applied for an emergency loan from the SBA, is officially out of money, the agency said this weekend. The SBA says it provided $20 billion in advance funds, the full amount allocated by Congress, to almost six million businesses employing 30.5 million people. The money was doled out in advances of $1,000 per employee, up to $10,000 per business.

The advances were originally approved back in March as part of the CARES Act and were distributed via the SBA’s existing Economic Injury Disaster Loans, or EIDL program, through which businesses and nonprofits can apply for low-interest loans.

The EIDL program is still open and accepting applications, but the advances which were highly sought after as they did not have to be paid back are no longer part of the deal.

Amid overwhelming demand during the early days of the COVID-19 outbreak, chaos and confusion initially plagued the EIDL program, with many small businesses and sole proprietors saying they were unable to find lenders or even contact the SBA for guidance. Presumably, a good number of frustrated business owners simply gave up.

Congress, meanwhile, is on break until next week, and lawmakers on Capitol Hill have yet to agree on the details of the next stimulus package.

The SBA says companies still seeking disaster assistance should visit their website for more information. See link below:

Small Business Administration

AS ALWAYS, WAGNER & ZWERMAN IS HERE TO ANSWER ALL OF YOUR QUESTIONS AND CONCERNS. WE ARE ALL IN THIS TOGETHER.

** IF YOU HAVE MISSED ANY PREVIOUS WZ WEBINARS OR COMMUNICATION IN REGARDS TO COVID-19, PLEASE REFER TO OUR WEBSITE

Best,

WZ Partners

Dear Clients, Business Associates and Friends:

The US House passed an extension of the $660 billion Paycheck Protection Program fewer than 24 hours after the program shut its doors, moving one step closer to reopening the cornerstone small business coronavirus relief effort.

The House unanimously passed the extension, which would keep the program open to applications to August 8, 2020. The measure will now go to President Donald Trump’s desk for his signature.

The House passage completes a whirlwind several days for a program that was all but certain to shutter until bipartisan negotiations were sparked in the US Senate on Tuesday afternoon.

Throughout the day Wednesday, House Democrats also debated how to handle the extension, with some pushing for additional changes to the program, according to several aides involved in the discussions.

Treasury Secretary Steven Mnuchin and Small Business Administration Administrator Jovita Carranza told lawmakers last week that data would be delivered to House committees by the end of this week, but there has been palpable frustration among Democrats over how long it has taken up to this point.

As it stands, more than 4.8 million small businesses tapped more than $520 billion in potentially forgivable loans through the program, a central pillar of the $2.2 trillion emergency economic relief efforts deployed in March to try and keep the economy afloat as the pandemic led to mass shut downs of businesses around the country.

The program was so critical at its inception that a first round of funding dried up in fewer than two weeks and had to be replenished. But interest in the program largely dried up in recent weeks, as shifting rules and the inability of borrowers to come back for a second loan limited the number of small businesses able to go through the application process.

More than $130 billion in allocated funds remained unused at the time of the program’s closure Tuesday night.

That, along with the looming deadline, have spurred bipartisan negotiations about the next phase of the program and small business relief.

Bipartisan Senate negotiations have started to move quickly, as lawmakers seek to lay the groundwork for the small business portion of the next stimulus legislation. Negotiations on that package are expected to kick into gear later this month after lawmakers return from the July 4 holiday recess.

Lawmakers involved in he negotiations are seeking a more targeted use of the left over funds in the next round of stimulus legislation, focusing specifically on the hardest hit businesses and industries.

AS ALWAYS, WAGNER & ZWERMAN IS HERE TO ANSWER ALL OF YOUR QUESTIONS AND CONCERNS. WE ARE ALL IN THIS TOGETHER.

** IF YOU HAVE MISSED ANY PREVIOUS WZ WEBINARS OR COMMUNICATION IN REGARDS TO COVID-19, PLEASE REFER TO OUR WEBSITE

On Tuesday, June 30, 2020, the U.S. Senate passed by unanimous consent a five-week extension of the Paycheck Protection Program (PPP).

The House of Representatives would have to pass the measure and President Donald Trump would have to sign it before the extension would take effect. Both chambers of Congress are expected to adjourn by the end of the week for a two-week recess.

The surprise move is intended to provide more time for small businesses to apply for the approximately $129 billion in PPP funding remaining. The PPP was launched in early April as the COVID-19 pandemic battered the U.S. economy and forced many businesses to close. The program provides forgivable loans that small businesses and other qualifying entities can use to cover payroll and other select costs.

The U.S. Small Business Administration (SBA), which oversees the program with the Treasury Department, stopped accepting loan applications at midnight Tuesday. The plan approved by the Senate on Tuesday night would extend the application period until Aug. 8, 2020.

As of 5 p.m. ET on Tuesday, June 30, 2020, the SBA had approved nearly 4.9 million loans for a total of more than $520 billion.

AS ALWAYS, WAGNER & ZWERMAN IS HERE TO ANSWER ALL OF YOUR QUESTIONS AND CONCERNS. WE ARE ALL IN THIS TOGETHER.

** IF YOU HAVE MISSED ANY PREVIOUS WZ WEBINARS OR COMMUNICATION IN REGARDS TO COVID-19, PLEASE REFER TO OUR WEBSITE