michigan ppp loan forgiveness

Earlier in October, the SBA and Treasury released a simpler forgiveness application for PPP loans of $50,000 or less and streamlined the PPP loan forgiveness process for a majority of the borrowers. Three existing forgiveness application forms. You can get forgiveness for this PPP loan by spending at least 60% on payroll expenses (wages, salaries, retirement, group health insurance, etc.) You cannot get both a small business loan under the PPP and also claim a tax credit. If, however, your business is affiliated with other businesses who received PPP loans which, in addition to yours, total more than $2 million, you must apply with the 3508EZ or 3508. The EZ Application simplified the forgiveness process for certain borrowers, while the Simple Application further streamlined the process for all PPP loans of $50,000 or less. Posted by Bryan Powrozek and Sarah Russell on October 20, 2020. Since a key … The new IRS Notice 2021-20 provided some needed guidance on how to handle the interaction between ERC and PPP, especially in cases where the taxpayer has already applied for PPP loan forgiveness.. As contained in the Notice, and for purposes of Michigan state income tax, Michigan will conform to the federal tax treatment for both PPP loan forgiveness and the … Loan Forgiveness Application 3508S: For PPP loans of $150,000 or less. 1. In other words, typical debt accounting. PPP Loan Forgiveness Calculation Form. If your EIDL loan was used for payroll costs, your PPP loan must be used to refinance your EIDL loan. SBA Paycheck Protection Program (PPP) resources for CPAs. After passing the CRRSAA in December 2020, Congress declared that a PPP loan that has been forgiven would not be taxed — it is not categorized as taxable income. Authored by the Butzel Long CARES Act Speciality Team: Brett Miller, Mernie Fuhs, Justin Klimko, and Tom Kabel. A large majority of first round PPP loans fall under the simpler forgiveness criteria and process. Further, cutting worker hours may make it difficult for some businesses to satisfy another stipulation of PPP loan forgiveness: that a business devote at least 75% of loan … This is NOT a directory of companies that received a loan using SBA.com® loan request service. On January 19, 2021 the SBA released updated and revised forms for each of the Full, EZ and Simple applications. Notifications will be sent based on the funding date of your PPP loan. However, at least 75 percent of the PPP loan … Preparing for PPP Loan Forgiveness. According to Michigan Farm Bureau National Legislative Counsel, John Kran, the updated SBA interim final rules are significant, noting the changes to the original PPP loan forgiveness and review rules provide considerable flexibility for calculating whether a borrower qualifies for PPP loan forgiveness. The Paycheck Protection Program (PPP) was originally created under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, enacted March 27, 2020,to provide cash flow assistance to small businesses impacted by the COVID-19 pandemic. Michigan PPP Funded Companies. When accounting for a PPP loan as a debt, it should be done in accordance with FASB ASC 470 and accrue interest in accordance with the interest method under FASB ASC 835-30. It must be at least eight weeks after the initial loan date, but no more than 24 weeks after the initial loan date. So if you got a PPP loan , basically, the government is giving you funds to pay yourself, to replace the income you’re not making for eight weeks. Download a printable version of this alert here: DOWNLOAD. Browse & Search CARES Act PPP Recipients. You can use 100% of the PPP proceeds on compensation - with one caution. Further, all other subsequent pages on the P&L statement must be initialed. Did your business receive a Paycheck Protection Program (PPP) loan? SBA Form 3508 (06/20) Page 3 Paycheck Protection Prog ram Loan Forgiveness Application Revised June 16, 2020 OMB Control Number 3245-0 407 Expiration Date: 12/31/2023 Instructions for … The Small Business Administration (SBA) and Treasury Friday released two interim final rules providing Paycheck Protection Program (PPP) guidance to help borrowers and lenders. Please be advised that all PPP Loans originated in 2021 are required to sign and date the first page of the company profit and loss (P&L) statement when submitting a PPP Loan Forgiveness application. The PPP was created by the CARES Act to provide forgivable loans to eligible small businesses to keep American workers on the payroll during the COVID-19 pandemic. If you received a PPP Loan of $150,000 or less, you are eligible to apply with the 3508S Application. Businesses still need to document PPP loan money was spent on eligible expenses. On Friday, May 22, 2020, the Small Business Administration (SBA) and Department of Treasury issued an Interim Final Rule (IFR) that provides some additional clarity on Paycheck Protection Program (PPP) loan forgiveness. 2. PUBLISHED 5/18/2020. Under PPP program rules, loans can be forgiven if the recipient spends at least 60% of the money on payroll costs and maintains its employee … This is NOT a directory of companies that received a loan using SBA.com® loan request service. 116-136, which was signed into law March 27. So the PPP loan is basically giving you the same amount that you would have received as wages or payroll for eight weeks. Michigan Specific guidance has not been issued. With the coronavirus shutting down much of the U.S. economy, Congress created the PPP to assist millions of small businesses suddenly facing an uncertain future. PPP borrowers could face unwelcome surprise on state tax bill. (The deadline for PPP applications is May 31, 2021). 2020-05-27. Under the program, eligible borrowers can apply for and receive federally guaranteed loans to be used for the payment of payroll and certain other qualified b… At the time the first round ended on Aug. 8, the average PPP loan was $101,000. The PPP Lender, after receipt of a complete PPP loan forgiveness application, has 60 days to provide its forgiveness decision to the SBA, whereafter the SBA has 90 days to review the loan forgiveness materials and make the final forgiveness determination. Michigan PPP Funded Companies. Loans under the PPP will be 100 percent guaranteed by SBA, and the full principal amount of the loans may qualify for loan forgiveness. Michigan businesses received 128,159 Paycheck Protection Program loans, as of August, totaling more than $16 billion in support. Completed the loan forgiveness process per the PPP requirements and the SBA has remitted funds to the PPP lender in satisfaction of the PPP note, or the PPP borrower has repaid any remaining balance on the PPP loan. Up to 100% of your loan may be forgiven if you meet program requirements, including using funds to pay for eligible business expenses. On May 16, 2020, the SBA released its long-awaited forgiveness application that includes detailed guidance on calculating how much of a Paycheck Protection Program … While further guidance from the federal government is still needed, there are steps to take for businesses interested in receiving Repaid the PPP note in full; or. until the Small Business Administration remits the loan forgiveness amount to the lender. This article is available to … (Partial forgiveness is available if less than 60% of the proceeds were used for payroll costs.) The IFR comes on the heels of the forgiveness Application that SBA issued several days prior (Application). New and Revised PPP Loan Forgiveness Applications June 17, 2020 The U.S. Small Business Administration, in consultation with the Department of the Treasury, posted a revised, borrower-friendly PPP Forgiveness Application form implementing the PPP Flexibility Act of 2020, signed into law by President Trump on June 5, 2020. [6] First, in … (This includes the loan and the forgiveness applications) Thank you for the trust you’ve placed in us. You claim the full $22,500 of your PPP loan for forgiveness. The PPP came into being as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, P.L. Start PPP Forgiveness Process. PPP Double Jeopardy: Loan Forgiveness and Tax Implications. Here's a link to the Journal of Accountancy article covering the new loan forgiveness application and the E-Z loan forgiveness application. The U.S. Small Business Administration has released a simplified loan forgiveness application for Paycheck Protection Program loans of $50,000 or less. It integrates the retroactive changes into the PPP1 program and also discusses the PPP2 program. The Michigan State Loan Repayment Program (MSLRP) helps employers recruit and retain primary medical, dental, and mental healthcare providers by providing loan repayment to those entering into service obligations. If the employer’s employment tax deposits are not sufficient to cover the credit, the employer may receive an advance payment from the IRS by submitting Form 7200 to request an advance payment of employer credits due to COVID-19. Specific guidance has not been issued. Applications for a PPP loan must be submitted no later than March 31, 2021, and PPP applications for loans of up to $150,000 will be simplified. What Governor Whitmer’s Thursday announcement means for businesses and employers 2. Economic Injury Disaster Loans. Michigan businesses can accept their forgiven pandemic loans without worrying about paying federal taxes, but it’s not yet clear if they’ll owe state taxes. If you have further questions, contact your local lender. $100,000/52*8=$15,384.62 max per employee during the 8 week forgiveness period). The 75% minimum salary is $2,250 (0.75 x $3,000). In August of 2020, the IRS weighed in on the deductibility of the expenses used as the basis for a company’s PPP loan forgiveness application. Loan Forgiveness Application 3508EZ: For PPP loans of any size that meet one of these three criteria: You are a self-employed individual, independent contractor, or sole proprietor who had no employees at the time of the PPP loan application. The AICPA’s revised PPP Loan Forgiveness calculator is now available. PPP borrowers could face unwelcome surprise on state tax bill. CentralStar Cooperative, Inc. (371) Manpower of Lansing, Michigan, Inc. (500) More Lansing-area PPP loans: These businesses received PPP loans of at least $1 million. Application. After approving more loans in six weeks than during the prior nearly 60 years combined, the U.S. Small Business Administration now looks to provide debt forgiveness to borrowers. “The Paycheck Protection Program has certainly been a lifeline for many small businesses and employees across southwest Michigan and around the country. The U.S. Small Business Administration released a simplified loan forgiveness application Thursday for Paycheck Protection Program (PPP) loans of $50,000 or less. More than 121,000 Michigan businesses took federal forgivable Paycheck Protection Program (PPP) loans valued at approximately $15.7 billion. Ask an Expert: PPP Loan Forgiveness Wednesday, July 1 3:00 pm. On April 19, 2021, the Michigan Department of Treasury issued a notice (the “Notice”) announcing Michigan’s conformity to the federal income tax treatment of loans (“PPP Loans”) issued under the Paycheck Protection Program. and last updated 9:21 AM, Apr 23, 2021. Proceeds from any advance up to $10,000 on the EIDL loan will be deducted from the loan forgiveness amount on the PPP loan. The basic rule is that any wages included on a PPP loan forgiveness … PPP loan forgiveness trends, ongoing PPP borrower obligations and other recent SBA developments 5 The deadline to apply for a PPP loan was initially June 30, 2020, and was later extended to August 8. There is further data we’re working on for the loans under $150k however so check back in … Download Now. Michigan opening to full capacity on June 22? As contained in the Notice, and for purposes of Michigan state income tax, Michigan will conform to the federal tax treatment for both PPP loan forgiveness and the … March 16, 2021 – Legislative Update: Summary of Guidance Regarding ERC and PPP Interaction, Including Examples. The forgiveness process can be started after the funds have been appropriately used. This action streamlines the PPP forgiveness process to provide financial and administrative relief to the more than 100,000 small businesses here in … FNB wrote about 600 PPP loans in the first round in 2020, about 200 of which have since been forgiven by the SBA, Piper said. The new process has significantly shortened the amount of time it takes to review forgiveness applications before submitting them ... 111,773 Michigan businesses received approval for PPP loans totaling $15,778,056,406 as of May 16. The Paycheck Protection Small Business Forgiveness Act would streamline for process for certifying compliance with PPP requirements and expedite the loan forgiveness process for small businesses. IMPORTANT UPDATE ABOUT OUR PPP LOAN & FORGIVENESS APPLICATIONS: PPP Loans: Please note that the Paycheck Protection Program officially closed to new applicants on May 28th, 2021. Congress chose to exempt forgiven Paycheck Protection Program (PPP) loans from federal income taxation. Many states, however, remain on track to tax them by either treating forgiven loans as taxable income, denying the deduction for expenses paid for using forgiven loans, or both. PPP-Loan-Forgiveness-Application-Form-3508S. 785 Michigan restaurants got $150K or more in federal loans. “Overall, (the PPP) probably kept a wave of bankruptcies from happening,” said Lisa Cook, an economist at Michigan … Approximately 62% of Michigan PPP borrowers are eligible for a simplified PPP loan forgiveness application that can take as little as 15 minutes to complete. Additionally, 83,926 businesses received SBA Disaster Assistance EIDL loans totaling $4.35 billion. You can check the status of your application by clicking the below link. The loan may be partially or fully forgiven if the business keeps its employee counts and employee wages stable. This webinar will provide the guidance and steps to take now to ensure loan forgiveness. You can get forgiveness for this PPP loan by spending at least 60% on payroll expenses (wages, salaries, retirement, group health insurance, etc.) AICPA’s SBA PPP Resources page. She has a Masters degree in Accounting from Walsh College and a Bachelors degree in Art History from the University of Michigan. The Treasury Department has offered several PPP Loan Forgiveness Applications, which businesses can fill and submit to the private lender who offered the loan. 116-135 (the … Your approach will depend on whether you expect loan forgiveness, the type of entity receiving the loan, and whether your organization files financial statements with the SEC. SBA will forgive loans if all employee retention criteria are met, and the funds are used for eligible expenses. The lender has 60 days from receipt of a … Loan payments are deferred for companies that apply for loan forgiveness. L. No. Erica Battle is a CPA with UHY, LLP and has helped manage and grow their nonprofit industries practice since she joined the firm in 2014. After the Internal Revenue Service decided that the forgiven loans were taxable, Congress passed legislation in December exempting them from federal income taxes. More than 121,000 Michigan businesses took federal forgivable Paycheck Protection Program (PPP) loans valued at approximately $15.7 billion. The $2.3 trillion bill providing Covid-19 relief and government funding for the fiscal year into 2021 includes $284 billion in additional funding for PPP loans, which were designed to … This law excludes forgiven PPP loans from taxable income but decouples from the federal expense deduction allowance, instead offering a state-specific deduction for up to $100,000 in expenses paid for using forgiven PPP loans. and a maximum of 40% on qualifying expenses during an 8- or 24-week period. If the PPP PPP Loan Provisions and Forgiveness Update (PPPLP-032521-W) Date and Time: Thursday, March 25, 20201, 10:00 am – 1:00 pm EST. The CARES Act provides multiple accounting options for PPP loans. PPP loan is called the paycheck protection program. To our 14,000+ customers who received SBA Paycheck Protection Program funding in 2020, we encourage you to stay on track to be eligible for loan forgiveness. More than 87 percent of all PPP loans were for $150,000 or less, while two thirds were for $50,000 or less, according to SBA data. Features of PPP loans include: Interest rate of 1%. The treatment of PPP loans in Michigan will generally have the same treatment as provided on the federal return. SBA turns focus to PPP loan forgiveness. The PPP allows a portion, or all, of your loan and accrued interest to be forgiven if the proceeds were used for eligible payroll and non-payroll costs. After the Internal Revenue Service decided that the forgiven loans were taxable, … When it comes to calculating your forgivable amount, your lender looks at each employee’s individual compensation. 2020-05-27. This website contains information about … Action streamlines the PPP forgiveness process for Michigan small businesses. SBA Releases PPP Loan Forgiveness Application and Provides Additional Clarity. Russell says the PPP loan forgiveness requirements are quite favorable to borrowers, but those regulations weren’t issued until months after some businesses got PPP loans. PPP Loan Forgiveness and Employees Who Refuse to Come Back to Work. PPP Set Asides for Certain Small Businesses The documents released today will help small businesses seek forgiveness at the conclusion of the eight-week covered period, which begins with the disbursement of their loans. You’re paying each person $250 less each month. Monday, May 18, 2020. LANSING, Mich. — Taxpayers who accepted federal Paycheck Protection Program (PPP) loans will not be taxed on loans … You can still meet the PPP eligibility requirements for a first or second-draw PPP loan, even if you’re currently unemployed.