Category Archives: COVID 19 UPDATES

House Passes PPP Extension

SENATE APPROVES 5-WEEK PPP EXTENSION

WZ WEBINAR-New PPP Forgiveness Rules and Update on Other Government Loan Programs-RECORDING 6/26/2020

Dear Clients, Business Associates and Friends:
In case you missed the webinar on 6/26/2020 you can watch it here. The Master Spreadsheet (updated as of 6/26/2020) is available here:  Forgiveness Reduction Formulas .  A pdf of the presentation is also available here: NEW PPP FORGIVENESS RULES AND UPDATE ON OTHER GOVERNMENT LOAN PROGRAMS.
As always, Wagner & Zwerman are available to answer any of your questions and concerns and we are committed in providing you with the most updated information as it becomes available.
Best,
WZ Partners

 

Wagner & Zwerman LLP

NEW WZ WEBINAR SCHEDULED 6/26/2020

NEW LAW DECOUPLES NYC FROM SOME FEDERAL “CARES” ACT PROVISIONS

Dear Clients, Business Associates and Friends:
A.B. 10519 / S.B. 8411, signed by gov. 6/17/20. The New York FY 2020-2021 State Budget Bill enacted in April 2020 (Budget Act) decoupled the New York State and New York City corporate and personal income taxes from certain federal tax provisions enacted under the federal Coronavirus Aid, Relief, and Economic Security (“CARES”) Act (i.e., P.L. 116-136). Recently signed state legislation further decouples New York City business income taxes from additional CARES Act provisions. More specifically, new law provides for the following amendments to the New York City Unincorporated Business Tax (UBT), General Corporation Tax (GCT), Banking Corporation Tax (BTX) and Business Corporation Tax (BCT):
1.      Regarding the UBT, the bill decouples from the CARES Act amendments related to:
      1. The temporary repeal of the loss limitation for individuals, estates and trusts under IRC section 461(l) for tax years beginning before January 1, 2021 (under CARES Act section 2304);
      2. The new federal five-year carryback for net operating losses arising in the 2018, 2019, and 2020 tax years, as well as the temporary repeal of the 80% of income limitation for tax years beginning before 2021 (under CARES Act section 2303); and
      3. Modifications to the limitation on business interest expense deduction under IRC section 163(j)(10) for tax years beginning in 2019 and 2020 (under CARES Act section 2306), including provisions addressing partnerships and the election to use 2019 adjusted taxable income (ATI) in 2020 for computing the interest expense deduction (note: the provision allowing 50% of ATI to compute interest expense deduction in 2019 and 2020 was previously decoupled from under the Budget Act legislation);
2.     Regarding the BTX and GCT, the bill decouples from the CARES Act amendment provisions described in 1b) and 1c) above; and
Regarding the BCT, the bill decouples from the CARES Act amendment provisions described in 1c) above.

 

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

 

Wagner & Zwerman LLP

 

NEW PPP LOAN FORGIVENESS APPLICATIONS

Dear Clients, Business Associates and Friends:
The Small Business Administration (SBA) has released two Paycheck Protection Program (PPP) Loan Forgiveness Applications with instructions. Provided below are links for the two applications:
PPP Form 3508 EZ
PPP Form 3508
The updated Form 3508 has been reduced to five pages and the new Form 3508EZ is two pages long. Both forms were designed to make the application process simpler. 
The forms now take into account the new rules issued thru the Payroll Protection Flexibility Act (PPFA). Those provisions included a 24 week covered period for expenses, and an increased percentage for non payroll costs. 
The new EZ version applies to borrowers that can meet one of three criteria below: 
  • Are self-employed and have no employees; OR
  • Did not reduce the salaries or wages of their employees by more than 25%, and did not have any full time equivalent reductions of their employees; OR
  • Experienced reductions in business activity as a result of health directives related to COVID-19, and did not reduce the salaries or wages of their employees by more than 25%.
New guidance will now limit owner compensation for the 24 week covered period to $20,833 (the 2.5-month equivalent of $100,000 per year) or the 2.5-month equivalent of their applicable compensation in 2019, whichever is lower. For an 8-week Covered Period, this amount is capped at 8/52 of compensation (up to $15,385).
Employee compensation will be capped at $46,154 ( $100,000 annual / 52 *24 ) for the 24 week covered period or $15,385 for an 8 week period.
If the borrower received its PPP loan before June 5, 2020, the borrower may elect to use either the 8 week or 24 week covered period. For any loans received after June 5, 2020, the borrower must use the 24 week covered period.
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

 

Wagner & Zwerman LLP

MAIN STREET LENDING PROGRAM LENDER REGISTRATION

Dear Clients, Business Associates and Friends:
The Federal Reserve opened Lender registration this week for the Main Street Lending Program. They are currently working to create the infrastructure necessary to fully operate the program. Once operational, small and medium sized businesses can apply by contacting an eligible lender.
Please see the attached FAQ’s as of June 8, 2020 for additional information.

 

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

 

Wagner & Zwerman LLP

SBA LOANS FOR AGRICULTURAL BUSINESSES

Dear Clients, Business Associates and Friends:
Beginning Monday June 22nd , The Small Business Administration is reopening its Economic Injury Disaster Loan and EIDL Advance Grant Portal to a broader array of eligible small businesses and nonprofits affected by the coronavirus pandemic.
The portal had been accepting applications only from agricultural businesses for the last month, as demand was high, and those businesses had not been EIDL eligible in the past.
To meet the unprecedented need, the SBA has made numerous improvements to the application and loan closing process, including deploying new technology and automated tools.
The EIDL program has gotten less attention than the SBA’s Paycheck Protection Program, which has been popular on Main Street but had a rocky initial rollout with businesses delayed in getting funding and large public companies being shamed into returning funds. As of Sunday June 14th , 1.43 million loans had been approved for a total of $95.6 billion through the EIDL program.
The loans available under the program had been for as much as $2 million, but that number was dropped to $150,000 due to demand. The program’s emergency grant was also dropped from its initial amount of up to $10,000 per business, to $1,000 per employee, per business.
As of Friday June 14th , the PPP had 4.5 million loans approved for a total of $512 billion, with nearly $130 billion left unallocated for small businesses.
Data from the National Federation of Independent Business from earlier this month found that of the respondents who applied for an EIDL loan, 57% have been approved so far, 38% have not heard yet about the status of their application, and 5% were denied. About 36% of EIDL applicants have received the loan as of June 2nd . Sixty-nine percent of those who requested the EIDL emergency advance had received those funds.
Unlike the Paycheck Protection Program, which businesses have the opportunity to apply to through June 30th , businesses can apply to the EIDL programs through the end of the year.
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

 

Wagner & Zwerman LLP

WHAT IS THE SBA DEBT RELIEF PROGRAM AND HOW DO I APPLY?

Dear Clients, Business Associates and Friends:
The Small Business Administration’s Debt Relief Program eliminates certain SBA loan payments for six months. As of March 27, the SBA covers all SBA 7(a), 504, and microloan payments, including principal and interest.
The Paycheck Protection Program loans and Economic Injury Disaster Loans aren’t eligible. Participation in the program is automatic, and no application is necessary. The SBA has instructed lenders to stop collecting payments from borrowers during the debt-relief period.
For loans that aren’t deferred, the SBA will start making payments on the next payment due, and will make six monthly payments. With loans that are deferred, the SBA will make payments starting with the first payment due after the deferment and will make six monthly payments.
Businesses that pay their 7(a), 504, or microloans through automatic payments have to stop these payments during the debt-relief period. If a business makes a payment on its loans after March 27, they say, its lender must give them the option to return the payment or apply it to the loan balance.
New 7(a), 504, and microloans that businesses apply for and receive between March 27 and Sept. 27 are also eligible for the Debt Relief Program. For these loans, the SBA will pay the first six monthly payments. The SBA will make payments within 30 days of the date that the first payment is due.
While SBA Serviced Disaster (Home and Business) Loans aren’t eligible for the Debt Relief Program, if the loan had a “regular servicing” status on March 1, then the SBA will automatically defer loan payments through Dec. 31. These loans will continue to accrue interest, but businesses are not required to make regular payments until after Dec. 31. With disaster loan deferrals, the SBA does not automatically cancel pre-authorized or recurring payments. Businesses are responsible for canceling these payments.
For more about the SBA Debt Relief Program, click here and what the SBA covers, click here.
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
Wagner & Zwerman LLP

 

FEDERAL RESERVE EXPANDS MAIN STREET LENDING PROGRAM

Dear Clients, Business Associates and Friends:
The Federal Reserve has changed the terms of its Main Street lending program to allow for greater participation for both smaller and bigger loans.
On Monday, June 8, 2020, the central bank said it is lowering the initially stated minimum loan and raising the maximum that can be borrowed, plus is expanding the loan terms to five years. The program is part of the Fed’s efforts to get money to small and medium-sized businesses hurt during the Coronavirus induced recession.
Under the new guidelines, the minimum loan now will be $250,000, half the amount under previous versions of the plan. The maximum will now vary by facility but could be up to $300 million from the previous $200 million.
In addition to the changes in loan size, the Fed also has extended the repayment period from four years to five years and will delay the repayment period to two years from the original one year. Interest also is delayed for one year and will be Libor, a commonly used overnight lending rate, plus 3%. Lenders will now assume just 5% of the loans, with the Fed holding the rest.
The program is part of a dozen measures the central bank has taken to boost lending and liquidity during the Coronavirus crisis. The Fed has “lending but not spending” powers. Main Street and other similar programs are being backstopped by Treasury money that the Fed can leverage up. In this case, the Treasury is providing $75 billion in equity that can be used for $600 billion in lending.
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
Wagner & Zwerman LLP