As always, as new details become available on legislation that could impact your business MSYS wants to keep you informed. Please review the information below as it may have a significant impact on your business. FYI- these are not loans programs if strategized and applied properly.
New PPP2 Legislation
There are still many unanswered questions regarding the new PPP2 legislation, but we should start taking steps now to gather the information needed to apply. We anticipate that banks will begin offering applications this week, with a few even offering pre-applications late last week.
If you haven’t heard from your banker yet, please touch base as soon as possible to see if they will be offering PPP2 second draw loans. If not, please contact MSYS as we have some resources for you!
Employee Retention Tax Credit (ERTC)
If you received PPP funding in 2020, the new PPP2 legislation removed the prohibition on taking the Employee Retention Tax Credit (ERTC). Many businesses will be eligible for significant credits, from payroll paid in 2020, not covered by PPP. Talk to your trusted business advisors about your eligibility for 2020 & 2021 ERTC.
Deductibility of PPP Dollars forgiven
Congress has corrected previous IRS guidelines that payroll and expenses used for forgiveness in PPP could not also be deducted from gross income to reduce Net Income. Congress has changed this to allow double dipping. You can use those dollars for forgiveness as well as deduct them as business write-offs against income. We will be making these necessary adjustments to your P&L for end of year 2020-once we get approved guidelines from the GAAP-CPA board on how to properly book those dollars on your balance sheet.
More news to come!
MSYS will continue to share new information as we learn of it. Please check your email often as some updates may require quick action. All the best!
-Your MSYS Team