Over the last year and a half, many businesses have been finding creative ways to keep their doors open and their employees on staff. Savvy business owners across the country have been taking advantage of Government programs such as the Payroll Protection Program, or PPP for short.
PPP is a loan designed to provide a direct incentive for small businesses to keep their workers on payroll. First Draw PPP loans can be used to help fund payroll costs, including benefits, and may also be used to pay for mortgage interest, rent, utilities, worker protection costs related to COVID-19, uninsured property damage costs caused by looting or vandalism during 2020, and certain supplier costs and expenses for operations.
The PPP application process wasn’t the easiest thing to navigate for the average business owner. There were a lot of stipulations that needed to be followed very precisely to ensure that the loan would be eligible for total forgiveness. The information needed was based off of the individual companies payroll data for the time period leading up to the application process.
We were able to successfully provide our customers with the data needed to ensure that they were compliant with the process, and more importantly, to ensure that the loan would be forgivable. We worked with various banks that were helping with the application process, and provided them with the reports needed to move forward.
We also helped our customers strategize how they will be using the PPP funds as efficiently as possible. We advised our customers to use 60% of the funds to keep their employees paid, and the remaining 40% for utilities and rent. Doing this allowed our customers to receive a higher ERTC down the road.
We think there is tremendous value in educating our customers on how to properly navigate and understand these applications so that they can get a true understanding as to whether or not it is the right move for their business. There were customers we advised not to apply for the PPP because it wouldn’t make sense for their business, and they could potentially be stuck having to repay the full amount of the loan. Our expertise gives us the ability to take a deep dive into all of our customers’ situations to determine what would be best for them.