Duquette, Hurley & Assoc, Inc.
Duquette, Hurley & Assoc, Inc.
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    • Home
    • ABOUT US
    • SERVICES $
    • Contact Us
    • TOOLS
    • PAY
    • Links
      • Pay Now
      • Satisfaction Survey
      • Remote Support (Windows)
      • Remote Support (MacOS)
      • Time Clock
      • Get Tax Questionnaire
      • RI Electronic Mandate
      • File Upload
  • Home
  • ABOUT US
  • SERVICES $
  • Contact Us
  • TOOLS
  • PAY
  • Links
    • Pay Now
    • Satisfaction Survey
    • Remote Support (Windows)
    • Remote Support (MacOS)
    • Time Clock
    • Get Tax Questionnaire
    • RI Electronic Mandate
    • File Upload

COVID-19 Information for Businesses

IMPORTANT NOTE

The summarized information below is tailored for what we think our clients would find most helpful. It is not the full rules, regulations or terms. This summary information is NOT tax advice and may be missing relevant information to make informed decisions. It's meant to help guide you the appropriate details linked below only. Please consult the details in the related links or contact us to discuss your specifics before relying on the summary information.  We may update this information as we learn more about the programs.  


***updated regulations marked with *** based on the December 27, 2020 COVID relief Act

PPP: Paycheck Protection Program Loans

Loan / Requirements

  • Max loan up to $10m up to 250% average monthly payroll for 2019. 

2 year term (5 year term for loans approved by SBA after 6/5/2020), 0.5% interest rate. No prepayment penalty. 1 PPP loan per entity.

Seasonal businesses may use average monthly payroll from  2/15/19 to 6/30/19 

New businesses may use average payroll from 1/1/20 to 2/29/20

Loan Requirements: 

  • Harmed by COVID-19 between 2/15/2020 and 6/30/2020
  • Retroactive to bring employees already laid off back onto payroll 
  • Available through 6/30/2020
  • Business in operation on 2/15/2020 (including sole prop & independent contractor)
  • Less than 500 employees per physical location 


Payroll Costs include:

  • Gross Compensation
  • Vacation/Sick Time
  • Group Health 
  • Retirement 
  • State Payroll Tax
  • (If self employed) Net Self Employment Income

Does NOT include

  • Compensation over $100k (per employee)
  • Outside US
  • Sick/Family leave under Families First Act 


Additional uses of loan (may not be forgiven) 

  • Mortgage/debt Interest
  • Inventory
  • Rent
  • Utilities



Additional program information HERE

Self-employed information HERE




Credit / Grant Assistance

Up to 24 weeks (previously 8 weeks which was updated 6/2020) of costs forgiven from loan balance (beginning on loan origination date) :

  • Payroll Costs
  • Mortgage Interest*
  • Covered Rent/leases*
  • Covered Utility Payments*

*in Force prior to 2/15/2020. Only 40% of the forgiven amount may be for non-payroll costs.


Deferral

  • Up to 10 months  (request up to 12 months)


Can get other SBA loans but can’t use same qualifying expenses for both


Must maintain payroll

  • If number of employees decrease, percentage of loan forgiveness decreases by same amount (if already laid off prior to 4/26/2020, can rehire by 12/31/2020). Exceptions may apply for businesses forced to shut  down or reduce staffing.
  • If payroll expenses decrease by more than 25% per employee, loan forgiveness may be reduced by the same amount.  
  • Safeharbor to restore headcount/wages by 9/30/2021


Loan Forgiveness Application

EZ Loan Forgiveness Application

Forgiveness Instructions 


***Second Draw Loan Application***

SBA Application (via bank)

***UPDATE DECEMBER 2020***

  • Costs paid with PPP funds will be deductible and forgiveness not taxable. 
  • Simplified forgiveness for loans under $150,000 (further information still pending)
  • An expected second round of PPP funding will be opened with similar requirements to the first round but adding a requirement to demonstrate a reduction in revenue of at least 25% between corresponding quarters in 2020 and 2019. 
  • Certain industries may receive 3.5x their average payroll rather than the previous 2.5x up to a maximum of $2m. 
  • Contact your local bank or prior lender for information on when/how to apply for a second round. 
  • ***updated March 2021*** Some sole-proprietors may qualify to apply for PPP loans based on GROSS sales.  SBA says you cannot go back and adjust if you already applied.  More Info HERE


EIDL: Economic Injury Disaster Loans

Loan / Requirements

Low interest (less than 3.75%) up to $2m to pay for expenses that could have been met had the disaster not occurred including payroll and operating expenses 


  • Less than 500 employees including sole proprietorship (even without employees), independent contractors
  • Available 1/31/2020 to 12/31/2020
  • Grants backdated to 1/31/2020 for those that already applied for EIDL
  • Can also apply for PPL loan or refinance EIDL into PPP but any advance amount under EIDL reduces PPP forgiveness 
  • Can’t use same qualifying expense for EIDL and PPP
  • Been in operation since 1/31/2020

Credit / Grant Assistance

Request grant of up to $10k ($1k per employee) when applying for loan that does not need to be repaid. 

Can be used for

  • Payroll
  • Sick Leave
  • Increase production Costs
  • Business obligations 
  • Debts
  • Rent 
  • Mortgage



***Grant money is not taxable***

***loan repayment deferred March 2021 as follows***

 

  • For all SBA disaster loans made in 2020, the first payment due date is 24 months, extended from 12 months, from the date of the note.
  • For all SBA disaster loans made in 2021, the first payment due date is 18 months, extended from 12 months, from the date of the note.

Apply through SBA Site

Small Business Debt Relief Program

Loan / Requirements

  • Up to $5m for fixed assets for expansion or modernization (real estate, equipment, etc)
  • Microloans up to $50k to startup/expand. 
  • Existing Non-Disaster 7(a) loans  (and maybe some 504 and microloans)
  • New borrowers who take out loans prior to 9/27/2020

Credit / Grant Assistance

SBA will cover loan payments (Principal & Interest)  for 6 months 


(Does Not include PPP loans) 


***Forgiven principal is not taxable***

More Information Coming

Payroll Tax Delay

Requirements

  • Delay employer portion of payroll taxes (FICA) through 2020. 
  • Deferred amounts due 50% of 12/31/2021 and 50% at 12/31/2022
  • Not available if receiving assistance through PPP  

Employee Retention Credit

Requirements

Refundable Payroll Tax Credit through 12/31/2020 (***extended until June 30, 2021***)

  • Wages  of employees who are furloughed or reduced as result of closure or economic   hardship.  
  • If 500 or fewer FT employees then all employee wages eligible regardless of furlough
  • Includes  health benefits
  • Wages  do not include those for other payroll credits, PPP loans,  for paid leave, family leave  or medical leave
  • Do not qualify if you received a PPP loan   ***updated to allow those that received PPP to qualify for this as well***


Credit / Grant Assistance

Refundable payroll tax credit for 50% of wages paid (including health benefits) for the first $10k in wages per employee 


***Credit increased to 70% with December 2020 bill***


Employers that have been fully or partially suspended as a result of government order limiting commerce, travel or group meetings 

OR 

Experienced >50% reduction in quarterly receipts year over year  

***updated to 20% reduction in quarterly receipts with December 2020 bill***

Paid Sick & Family Leave

Requirements

Employers with less than 500 employees must provide up to 2 weeks paid leave to employees. May be a hardship exemption for businesses with fewer than 50 employees for school closings or childcare unavailability if it could jeopardize business as a going concern.  


Qualifying reasons: 

  1. Quarantine or isolation order- 100% pay for 2 weeks up to $511 per day
  2. Health Care Provider advised self-quarantine- 100% pay for 2 weeks up to $511 per day
  3. Experiencing symptoms and seeking diagnosis- 100% pay for 2 weeks up to $511 per day
  4. Caring for individual subject to (1) or (2) above- 2/3 pay for 2 weeks up to $200 per day
  5. Caring for a child whose school or childcare closed- 2/3 pay for 12 weeks up to $200 per day


Employee information posters required to be posted: click HERE

Employer Information: click HERE

FAQs: click HERE

Credit / Grant Assistance

Full credit for wages paid plus cost to maintain health insurance.


Credit is applied against future federal payroll taxes and payments.  Can also request advance from IRS.


***UPDATE DECEMBER 2020***

Voluntary leave extended to 3/31/2021

Mandatory leave ends 12/31/2020

Find out more

Other Provisions

Net Operating Losses

 Ability to take losses from 2018, 2019 or 2020 and amend earlier returns to take advantage of a loss carry back for up to 5 years  

Business Meals

***added*** 100% deduction of business meals in 2021 and 2022 instead of the prior 50% deduction 

RI Specific Programs

Restore RI Grant

Grants up to $15,000 for eligible RI businesses impacted by COVID. 


Amounts vary based on number of employees.  Must have at least 1 employee plus the owner and less than 20 (no cap for restaurant and caterers). 


Must be able to show revenue declined by more than 50% in eligible industries (or 30% in industries listed as "severely impacted") 


Additional Requirements and details available HERE

Official State Announcement HERE

Grant Program for RI on 'Pause'

Grants of $500 to $50,000 for businesses impacted by the "Pause" in November/December 2020. 


Grant Information page HERE

Frequently Asked questions HERE

Duquette, Hurley & Assoc, Inc.

779 High Street, Cumberland, RI 02864

401.405.4455

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www.DuquetteHurley.com