Initially set up a year ago, the Paycheck Protection Program was a source of relief as the pandemic paralyzed the American economy. This program has since been expanded and extended due to the ongoing situation. Last week, U.S Senate approved an extension of the small-business relief program, which has about $79 billion left to distribute. The bill passed with a 92-7 vote and was signed into law by President Biden on Tuesday this week. This is a two-month extension that will give small business owners until the end of May to apply for forgivable loans.

According to the Small Business Administration, there is still $79 billion left to be lent, even after the approval of about 3.1 million loans, starting from the beginning of this year to March 21st. Owners that spend forgiveness money on approved costs, such as worker salaries, are eligible to convert their PPP loans into grants. Many business groups and leaders urged Congress to extend the deadline so that small businesses have enough time to apply for the money.

The new round of PPP lending that opened in January was available since Congress had approved of more funds in December. Additionally, lawmakers approved an extra $7.25 billion in the latest $1.9 trillion stimulus bill. This bill also expanded eligibility to some nonprofits and online publishers. This month’s package includes a $28.6 billion grant program for restaurants. Restaurants that have received PPP money can tap the fund if they can demonstrate enough revenue loss. It has not been announced as to how the SBA will be distributing those grants.

With the latest PPP round, some businesses were able to apply for a second loan, if they had already used their first one and met the requirements regarding the number of employees as well as being able to demonstrate a decline in revenue. Unfortunately, these new forms and exclusive access periods for some small businesses meant that the roll-out of additional funding was slow and many applicants waited weeks for their financing to be processed.

Talley’s professionals have spent hundreds of hours reviewing the law, regulations, and SBA PPP FAQs issued on an almost daily basis and we are happy to assist you in the process. We are available to simply answer a quick question or assist in the application and/or forgiveness audit process.

Under pressure to transform its operations digitally, GameStop Corp announced that they hired former Amazon.com Inc. executive Matt Francis as their first chief technology officer. GameStop’s change of focus from its 5,000 stores to e-commerce is due to activist investor Ryan Cohen. Mr. Francis will be overseeing GameStop’s e-commerce and technology functions.

Experts say that for a technology executive to be a successful digital transformation leader, they must have a special set of business and technology skills. These skills include, but are not limited to:

Map Data’s Role Across the Business
Starting with a digital transformation mission will put the focus on technology without understanding the business context. It is important to start with business transformation first to understand how data plays a role in customer engagement and business operations over time. Next, map technology against those strategies and understand where technology transformation is needed. By doing these things, focus changes from bottom-up to top-down, which creates a clear context for change.

Communicate in Language the C-Suite Understands
Understanding technical requirements as well as being able to put them into non-technical business language is important. Although fellow businesspeople may understand your viewpoints, it is best to keep it simple so that people can buy into your plan and are more willing to help out. The best digital transformation leader is one that communicates well, is seen as a colleague, and is seen to be an expert in IT.

Be a Talent Magnet
Being a really strong people leader is something that sets a lot of technology executives apart. No one is going to be able to solve all of the problems that may occur in a digital transformation. They need to set themselves apart in the competition for talent.

Connect Tech Investments to New Lines of Business
Many chief technology officers have to communicate with chief executives, boards, and other C-suite stakeholders to help construct and deliver technology that will be the right fit for the process. It is the digital transformation leader’s job to be in charge of the change when it comes to conversations about how the change will affect costs and revenue. Although many see technology as a way to cut costs, many are coming to realize that with technology, you can create new productivity, products, and lines of business.

Proper business planning is a complex and ongoing effort, requiring expert counsel—a professional with knowledge and experience, familiar with the challenges that characterize an entrepreneur’s business ventures. Talley LLP shares the same entrepreneurial spirit that has helped propel our clients to their current level of success. With over 25 years’ experience in helping high net worth individuals and business owners, Talley has the expertise necessary to assist entrepreneurs throughout their entire journey, from formation through succession.

As January came to a close, The U.S. Small Business Administration pledged to improve the loan review process for the Paycheck Protection Program loans, even with the growing number of fraud complaints. The SBA is attempting to allow small businesses as much time a possible to access needed PPP funds by taking steps to smooth the path for reviews of “first draw” loans.

In December 2020, Congress renewed the business lending program with an additional $284 billion in funding. Due to the introduction of the PPP loans included in the CARES Act last March, accountants were able to help small business clients procure loans and apply for forgiveness of the debt. However, there are obstacles that many businesses faced while trying to access the loans and navigating their ever-changing rules and procedures. These struggles were especially evident within the first round of funding when Congress had to renew the program allowing for more funding.

The SBA is committed to addressing issues more efficiently and ensure that there is fair and equitable access to the PPP loans for small businesses in every community. The program is intended for small businesses to provide loans that will be forgiven if they retained their employees for up to 8 weeks, but many larger companies and organizations ended up claiming the majority of the money. Another group that many small businesses had to compete with were those making fraudulent claims about being a small business. For instance, there was an individual who claimed he had a small business and 50 employees. It was discovered he  used PPP loan funds to buy a Lamborghini Huracan.

In response to those false claims, the SBA set up safeguards to avoid fraudulent claims; but this has proven to be a huge obstacle for small businesses. The SBA and Biden administration are working together to identify immediate solutions to promote transparency and to address eligibility, compliance and integrity.

The SBA will be hosting a nationwide call with a group of leaders to explain additional details they will need to provide to help resolve any first draw PPP loan reviews and potential holds that are affecting second draw approvals. Meanwhile, the SBA is also working on easing the review process for second draw loans so that can be processed in a more efficient way. They are equipping their field team of lender relation specialists with the information needed for appropriate responses to resolve problems and the SBA is going to provide extra guidance to PPP lenders on the review and resolution process.

Talley’s professionals have spent hundreds of hours reviewing the law, regulations, and SBA PPP FAQs issued on an almost daily basis and we are happy to assist you in the process. We are available to simply answer a quick question or assist in the application and/or forgiveness audit process.

Earlier this month, the U.S Small Business Association (SBA) and the Treasury Department decided to relaunch the Paycheck Protection Program to new borrowers and to prioritize loans from lenders in the community. As a result of the latest stimulus package passed by Congress, the program now has $284.5 billion for “first draw” PPP loans as well as “second draw” PPP loans. First-draw loans are for the small businesses that did not take advantage of the program last year, while the second draw is for those who used the PPP loans in 2020. Initially, community financial institutions were able to make first-draw and second-draw loans, but the SBA and Treasury have now opened the program to lenders as well.

In response to last year’s shaky launch, the SBA is making a concerted effort to increasing the availability of loans to small businesses. One complication from the PPP being launched with the CARES Act is that money was exhausted by large companies that already had ties with large banks. This left little money for small businesses until Congress appropriated more money. The PPP will be open through March 31st

Main updates to the program:

  • PPP borrowers can set their PPP loan’s covered period to be any length between 8 and 24 weeks to meet their business needs
  • PPP loans will cover additional expenses, including operations expenditures, property damage costs, supplier costs, and worker protection expenditures
  • PPP eligibility has expanded to include 501(c)(6)s, housing cooperative, destination marketing organizations, and other organizations
  • The PPP now offers more flexibility for seasonal employees
  • Qualified existing PPP borrowers can request to modify their first-draw PPP loan amount
  • Qualified existing PPP borrowers are eligible to apply for second-draw PPP loans

Borrowers are generally eligible for second draw PPP loan if:

  • Previously received at first-draw PPP loan and will or has used the full amount only for authorized uses
  • Has no more than 300 employees
  • Can demonstrate at least a 25 percent reduction in gross receipts between comparable quarters in 2019 and 2020

Talley’s professionals have spent hundreds of hours reviewing the law, regulations, and SBA PPP FAQs issued on an almost daily basis and we are happy to assist you in the process. We are available to simply answer a quick question or assist in the application and/or forgiveness audit process.

Entrepreneurs who took a PPP loan this year cannot write off certain expenses on their taxes if they expect the debt will be forgiven, according to the IRS and Treasury Department. The two agencies have issued guidance to clear up the tax treatment of expenses when a loan from the Small Business Administration’s Paycheck Protection Program hasn’t been forgiven by the end of the year.

The IRS and the Treasury issued both a revenue ruling and a revenue procedure, essentially saying that since businesses aren’t taxed on the proceeds of a forgiven PPP loan, the expenses aren’t deductible. The IRS notes that this results in neither a tax benefit nor harm since the taxpayer has not paid anything out of pocket.

“This results in neither a tax benefit nor tax harm since the taxpayer has not paid anything out of pocket,” said the Treasury in a news release. “If a business reasonably believes that a PPP loan will be forgiven in the future, expenses related to the loan are not deductible, whether the business has filed for forgiveness or not. Therefore, we encourage businesses to file for forgiveness as soon as possible.”

The IRS also notes that in cases where a PPP loan was expected to be forgiven, but it is not, businesses will be able to deduct those expenses. However, if a “business reasonably believes that a PPP loan will be forgiven in the future, expenses related to the loan are not deductible, whether the business has filed for forgiveness or not.”

Recently released guidance in IRS Notice 2020-32 further clarifies deducting expenses for PPP loans. The notice make clear that no deduction is allowed under the Tax Code for an expense that is otherwise deductible if the payment of the expense results in forgiveness of the loan under the CARES Act, and the income associated with the forgiveness is excluded from gross income.

Talley’s professionals have spent hundreds of hours reviewing the law, regulations and SBA PPP FAQs issued on an almost daily basis and we are happy to assist you in the process. We are available to simply answer a quick question or assist in the application and/or forgiveness audit process.

The SBA decided, in consultation with the Department of Treasury, that it will review all loans in excess of $2 million following the lender’s submission of the borrower’s loan forgiveness application. That being said, the SBA has reserved the right to also audit loans in any amount at any time, and will likely “spot check” loans in lower amounts.

Since the first round of funding was depleted so quickly, and many large businesses were approved for loans they didn’t need, the SBA is stepping up efforts to make sure every loan is going to the right business, for the right amount, for the right purpose.

When would an audit happen? PPP loan audits will be performed when a business seeks loan forgiveness. However, the borrower must retain PPP documentation files for six years after the date the loan was forgiven or repaid in full.

What are some items that the SBA may verify?

  • Eligibility: Was the borrower eligible for the PPP loan based on the rules and guidance available at the time of application?
  • Loan amount and loan use: Did the borrower calculate the loan amount correctly, and did the borrower use the loan funds for allowed expenses under the CARES Act?
  • Loan forgiveness: Is the borrower eligible for forgiveness on the claimed amount?

Are you using PPP funds correctly? If you are looking for the loan to be forgiven, at least 60% of the fund must be spent on payroll and employee benefits, while the remaining 40% on utilities, rent and mortgage interest. This will be verified by examination of your payroll records and expense documentation. If you spend funds on anything else, you could be subject to additional liability or even charges of fraud.

What could happen as the result of an audit? If you are ineligible for the loan or forgiveness amount, your forgiveness application may be rejected by the SBA and they may demand you repay the outstanding loan balance. You may choose to appeal the SBA’s decision.

How can you appeal? Your appeal must be filed within 30 calendar days after: 1. The receipt of the final SAB loan review decision, or; 2. Notification by the lender of the final SBA loan review decision; whichever is earlier. Once the appeal is filed, a judge will issue a decision within 45 calendar days.

Do you need a CPA for a PPP Audit? Although it is not required to have a CPA during this process, having one will help with finding and preparing documents that will be requested during an audit.

Talley’s professionals have spent hundreds of hours reviewing the law, regulations and SBA PPP FAQs issued on an almost daily basis and we are happy to assist you in the process. We are available to simply answer a quick question or assist in the application and/or forgiveness audit process.

The U.S. Small Business Administration (SBA) released guidance last week confirming that Paycheck Protection Program (PPP) loan forgiveness applications are not due on October 31, 2020. In the SBA’s latest loan forgiveness FAQ document, the SBA explains that borrowers may submit a loan forgiveness application any time before the maturity date of the loan, which is either two or five years from the loan’s origination, depending on the borrower’s agreement.

Fears of an October 31, 2020 PPP deadline came to the SBA’s attention because the program’s loan forgiveness application forms (3508, 3508EZ, and 3508S) show an expiration date of “10/31/2020” in the upper-right corner. This prompted the SBA to calm PPP borrowers’ fears of a surprise deadline by issuing a new entry in its loan forgiveness frequently asked questions document answering “Is October 31, 2020, the deadline for borrowers to apply for forgiveness?”

What is the Paycheck Protection Program (PPP)? The PPP is a part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. This act authorizes the Treasury to use the SBA’s 7(a) small business lending program to fund loans of up to $10 million per borrower that qualifying businesses can spend to cover payroll, mortgage eligible costs.

Talley’s professionals have spent literally hundreds of hours reviewing the law, regulations and FAQs issued on an almost daily basis and we are happy to assist you in the process. We are available to simply answer a quick question or assist in the application and/or forgiveness process.

As 2020 is coming to a close, employees of both large companies and small businesses are finding themselves in a rut as they continue to work from home. A survey conducted by FlexJobs and Mental Health America found that 75% of people have experienced work burnout and 40% said they felt it during the pandemic. Between job-less worries, work-from-home challenges and feeling overwhelmed, it’s easy to understand why both businesses and employees are experiencing work burnout as well as other mental health issues.

  • Acknowledge the problem. The first step in managing burnout is to acknowledge that you’re dealing with it. The symptoms of work burnout, as defined by the World Health Organization (WHO), include feeling: emotionally and/or physically drained; mentally checked out at work; excessive pressure to succeed and the need to hide personal concerns while at work. If you’re concerned about your mental health, you can take a free confidential and anonymous online screening at the Mental Health America website here.
  • Look into employer-provided mental heath benefits. These include telemedicine screenings, employee assistance programs and stress reduction programs. If your employer doesn’t provide assistance, look into services offered through local nonprofit agencies, veterans organizations or your state office of mental health.

  • Establish firm work/life boundaries. When you work from home, it’s critical to set healthy boundaries to keep the stress and demands of work from interfering with home life and vice versa. While not everyone has the option to dedicate a room in their home as their personal office, try to create a dedicated workspace that limits as many distractions as possible. Focus on work tasks before personal tasks, especially in the morning; later in the day, when you need a break, you can squeeze in personal tasks, exercise, or a fun activity to unwind.

Talley shares the same entrepreneurial spirit that has helped propel our clients to their current levels of success. With over 25 years of experience assisting high net worth individuals and business owners, Talley has the expertise necessary to help entrepreneurs throughout their entire journey, from formation to succession.

The U.S. Small Business Administration (SBA), in consultation with the Treasury Department, earlier this week released a simpler loan forgiveness application for Paycheck Protection Program (PPP) loans of $50,000 or less. This action streamlines the PPP forgiveness process to provide financial and administrative relief to America’s smallest businesses while also offering additional guidance on lender responsibilities.

Simplifying Forgiveness for Many. Under the new Interim Final Rules (IFR), Businesses that borrowed $50,000 or less won’t have the amount of their PPP loan forgiveness reduced based on reductions in full-time-equivalent employees or reductions in employee salary or wages. The newly simplified forgiveness application, Form 3508S, can be used by borrowers with a total loan amount of $50,000 or less, unless they and their affiliates received loans totaling $2 million or more.

For PPP loans of all sizes, the IFR also contains guidance on lender responsibilities with respect to the review of borrower documentation of eligible costs for forgiveness in excess of a borrower’s PPP loan amount.

Congress created the PPP as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which was signed into law on March 27. The legislation authorized Treasury to use the SBA’s 7(a) small business lending program to fund loans of up to $10 million per borrower that qualifying businesses could spend to cover payroll, mortgage interest, rent, and utilities.

PPP borrowers can qualify to have the loans forgiven if the proceeds are used to pay certain eligible costs. The program stopped accepting applications on Aug. 8 with almost $134 billion of congressionally approved funds remaining unspent.

Talley’s professionals have spent literally hundreds of hours reviewing the law, regulations and FAQs issued on an almost daily basis and we are happy to assist you in the process. We are available to simply answer a quick question or assist in the application and/or forgiveness process.

Have any questions about the PPP? Contact Us.

From Olympic medals to national championships, the world of elite sports is full of inspiring stories of hard work and determination. Similar to the career of an entrepreneur, success in this profession doesn’t come easy. Being a star player often requires long hours, creative thinking, and commitment to the team. Although physical talent is key to an athlete’s success, their mindset is even more critical and can teach entrepreneurs a few lessons on how to be equally victorious in the board room.

Continue to set goals and improve. Plateauing is both an athlete’s and an entrepreneur’s worst enemy. An athlete must set performance goals and create a plan to achieve new career milestones. Consistent practice and self-evaluation allow them to perform their best as a competitor. Likewise, entrepreneurs should set overall goals to keep their businesses moving in the right direction. They should focus on making a game plan that will help them improve as they continue to grow. Breaking their overall goals down into micro-goals is one way they can make tracking their progress more manageable.

Don’t be afraid to take risks. Most successful athletes did not get where they are by playing it safe. Risk and reward often go hand in hand, so pushing that extra mile or taking that final shot are what differentiate elite athletes from the average player. Finding a balance between risk and recklessness is also critical for entrepreneurs. Being too scared of change will inhibit growth, and changing too much at once will cause failure. Calculated risks are the solution to keeping a business ahead of competitors while taking potential concerns into account.

Keep your head in the game. The greatest athletes in the world are also recognized as leaders. Their hard work, ambition, and drive are qualities any director, CEO, or business influencer can aspire to possess. If an athlete makes a mistake, being able to separate their failures from their present performance allows them to continue reaching for success. Entrepreneurship may be one of the most challenging business environments, but business owners must maintain a level head throughout the ups and downs. Entrepreneurs need to stay confident in themselves even when the odds are stacked against them.

Talley shares the same entrepreneurial spirit that has helped propel our clients to their current levels of success. With over 25 years of experience assisting high net worth individuals and business owners, Talley has the expertise necessary to help entrepreneurs throughout their entire journey, from formation to succession.


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