This article is only for educational purposes and does not constitute legal, financial, or tax advice. Make sure you consult a professional regarding your unique business needs.

 

Hey BFF’s

Small businesses make up a vast majority of U.S. businesses. Unfortunately, these businesses have been hit extremely hard by the pandemic. Specifically, minority-owned businesses. Roughly 70% of small businesses without employees are Black-owned, Latino-owned, or women-owned.

I know the struggle has been real and you’re doing your best to keep your business open and a roof over your head. Chile, do I have great news for you! The Biden-Harris administration has increased lending to small businesses in need. Yes, there’s money for the little guys and girls.

The SBA is currently offering PPP (Paycheck Protection Program) loans to businesses with less than 20 employees. Whether you are a beautician, travel agent, barber, small independent retailer, sole proprietor, independent contractor, or self-employed, this is a fantastic opportunity for you and your business. The calculations are in your favor to get additional funding, and you do not have to be located in low-and-moderate income area.

Here is the best part, the Small Business Administration filled a ruling to allow individuals to use their gross income to calculate their loan value and they are removing the student loan delinquency restriction. Do you know how fantastic this is? Your gross income is generally higher than your net income. It allows for businesses that were affected by the pandemic to qualify for greater loans. Cha-ching *The gross income equals the total you earned before taxes and deductions. Net income refers to your income after you’ve paid taxes and deductions*

What does this mean?

It means you may be eligible for a loan even if your business did not make a profit at the end of the year.

What do you need to apply?

Depending on the institution you submit your application to, there may be slightly different application requirements. However, your eligibility, forgiveness, and terms of the loan will remain the same. Read the fine print to ensure you are meeting all requirements.

• Must have been in business before February 15, 2020.
• Must have filed taxes in 2019 or 2020.
• Locate your Schedule C 1040 tax form (for self-employed entrepreneurs).
• If you are a freelancer have your 1099 handy.
• Lawful U.S. residents must use their ITIN (Individual Taxpayer Identification Number) to apply
• Pass SBA fraud check.

What can I use the PPP loan for?

• Payroll – your salary, wages, commission, and/or tips
• Operation costs – software or cloud computing services
• Worker protection expenses – mask, plexiglass, gloves, etc.
• Mortgage interest payments – does not include payments on the mortgage principle
• Property damaged – if caused by public disturbances in 2020
• Rent
• Utilities

There is a short window of opportunity to apply. The application processed started Wednesday, February 24th, and closes Tuesday, March 9, 2021, at 5 pm eastern standard time.

This is not something you want to procrastinate with. Go online and apply now. I recommend starting an application with the financial institute you currently have your business or personal checking/savings account linked to.

Remember, having a registered business is not a requirement. If you are a 1099 employee this is for you also!

Ok, that’s all I have friends! Best of luck with the application process. Read the fine print before you submit.

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