Perhaps you were reluctant to sign up for last spring’s PPP loan offering because the word “loan” came into play. Loans can be scary, especially when income may be questionable, as was the case in 2020. However, the big picture is that with a PPP loan, you will obtain tax-free money that, as a business owner, you can write off.
This is all you have to do:
- Apply for a PPP tax-free loan from a lender.
- Spend those funds on payroll to yourself if you are self-employed or operate as a partnership; and on other approved expenses such as rent, interest, utilities, operations, property damage, suppliers, and worker protection.
- Apply for and receive 100% loan forgiveness, when you spend 60% or more of the money on payroll.
- Deduct the expenses that you paid with the PPP loan monies that were forgiven.
Catch This – There’s also New Money on the Table
The new COVID-19 stimulus act sets aside $35 billion for first-time PPP applicants, with $15 billion of that made in loans for first-time applicants with 10 employees or fewer, or made in amounts less than $250,000 to businesses in low-income areas.
The new deadline of March 31, 2021, replaces the expired deadline of August 8, 2020.
The monies available in this new round of PPP funding are on a first-come, first-served basis. Don’t procrastinate. Get your application for your first-time PPP monies in place now.
If you would like to discuss the PPP, connect with me or 201.787.6542.