Small Business FAQs

Your Latest Stimulus Loan Questions, Answered

From INC Magazine

https://www.inc.com/kevin-j-ryan/small-business-loans-ppp-most-pressing-questions-town-hall.html

Essential Businesses FAQ​

From the State of Illinois

https://www2.illinois.gov/dceo/SmallBizAssistance/Documents/Essential%20Business%20Checklist3-22.pdf

COVID-19 and the Fair Labor Standards Act Questions & Answers

From the Department of Labor

https://www.dol.gov/agencies/whd/flsa/pandemic  

Local Expert FAQs Last Updated - April 20 @ 3pm

1. What are some key things we need to be aware of to make sure we legitimately qualify for the PPP loans?
In general, you're eligible for the PPP loans if your company has fewer than 500 employees and was in business as of February 15, 2020. Unlike with traditional U.S. Small Business Administration loans, nonprofits, sole proprietors, people who are self-employed, and people who make their income as independent contractors are eligible. There had been some confusion about whether having credit available elsewhere makes you ineligible, but we now know that you're eligible regardless of whether you have available credit elsewhere. Some industries, including many agricultural industries, define small businesses differently. You can view the size standards by industry on the SBA website.

 

2. There's an exclusion for employees earning more than $100,000. Does this mean that their salary is excluded entirely, or simply capped at $100,000?

It means that for the purpose of calculating your loan, their salary is capped at $100,000. if you have an employee earning a salary of $150,000, for example, the size of your maximum loan will be calculated using a salary of $100,000 for that employee.

3. What is the difference between a loan and a grant?
A grant is a loan that gets forgiven, meaning it doesn't have to be paid back. Your PPP loans will be forgiven so long as you don't lay off employees or reduce their pay by more than 25 percent (for employees making less than $100,000) within eight weeks of receiving the loan. If you do lay off employees, you won't be forgiven for any wages you don't actually pay, but your remaining employees' wages will still be forgiven. Here's more on how to turn a paycheck protection loan into a grant.

4. If we have already executed layoffs, could we still be eligible for loan forgiveness if we bring back our employees?
If you rehire an employee, you'll be able to count their wages for the period during which they are on your payroll.

5.  As the owner of the business, is my W2 paycheck from my own company covered by the PPP as well?
Business owners' W2 paychecks are included, up to the $100,000 maximum.

6. Do you I have to payback any money my business receives through the Paycheck Protection Program
(PPP)?

No, all money received through PPP are forgivable as long the funds are dedicated to a business payroll.

 

7. I have already applied for the PPP, should I apply for other loans/grants through EIDL and/or other
resources?
S
mall business are advised to apply for as many of the available government grants and/or loans as
possible. Be sure to research the grant/loan to make sure it is the correct application for your business.

 

8. What does it look like for future money being added for the PPP, EIDL and other grant and loan
programs for small businesses?

Congress is currently reviewing a provision that when approved would provide an additional $310
billion to the PPP.

 

Q: If I need assistance completing my PPP or EIDL form(s) is a resource available to me?
For small-business owners wishing to apply for the Paycheck Protection Program, an emergency loan
administered by the U.S. Small Business Administration, free, weekly office hours are offered in two
places in DeKalb through April 30 – OC Creative (1600 E. Lincoln Highway, Suite D) and Sundog IT (230 E.
Lincoln Highway, Suite 200). OC Creative will offer these services from 10 a.m. to 4 p.m. Tuesdays and
Thursdays while Sundog IT will be open 5 to 7 p.m. Tuesdays and Thursdays.

Q: If a business or organization receives the $10,000 EIDL check, AND a PPP loan, does the EIDL amount
get deducted from the PPP grant?

Yes

Q: What happens if the PPP amount is lower than the $10,000 EIDL? Can we accept the EIDL and not
the PPP?

Yes, you do not have to accept for full amount of the PPP grant. You can evaluate how much of the
grant you wish to accept once you have received funds from both grants. PPP funds may be preferable
due to the grant funds being forgivable and not considered taxable income. EIDL funds are also
forgivable, but they are considered taxable income.

Q: Farmers are eligible for self-employed wages. How do we apply the 2.5 multiplier to our payroll?
With respect to the individual farmer (farm operation) the multiplier is based on the net income from
farming operations. Costs associated with any retirement or health insurance plan(s) should be included
in individuals net income figures. These recommendations apply to all sole proprietors and business
owners.

Q: How long in years are loan terms for EIDL and PPP payback?
Two years for PPP with deferment of first six (6) months with a potential for full-year deferment. EIDL
payback is up to 30 years.

Q: Can a business accept a grant or loan and still collect unemployment benefits? \
No. If a business is concerned about it employees departing the business post-lockdown, the PPP is a
good strategy

Q: Can you briefly describe the three main components of the CARES (economic stimulus) Act?
1. Federal Pandemic Unemployment Compensation (FPUC) allows for individual who have filed for
Unemployment Insurance (UI) to receive an additional $600/week in unemployment benefits. The
program runs through late July and is available to anyone who is eligible for UI. The additional
$600/week is taxable income for individual claimants, but claimants’ employers will not be charged. This
provision is a new component to traditional UI benefits packages and is available to both full-time and
part-time employees.
2. Pandemic Emergency Unemployment Compensation (PEUC) provides an additional 13 weeks of UI
benefits to individual who have already exhausted previously existing unemployment insurance
benefits.
3. Pandemic Unemployment Assistance (PUA) is a federal program that provides 39 weeks of
unemployment assistance to individual who traditionally have not been eligible for unemployment
benefits due to their field of employment (e.g. independent contractors, self-proprietors, self-
employed). This program is scheduled to be implemented in the state of Illinois on May 11.

 

Q: While the PUA is does not go into effect until May 11, will those eligible for the program be able to
apply for benefits retroactive to the date they became unemployed.

Yes, provisions within the PUA allow claimants to receive benefits dating back to the date they
became unemployed. The Illinois Department of Employment Security (IDES) is currently inundated with
the unemployment applications, but the agency is working diligently to process claims in a timely
fashion.

Q: Once I have applied and been accepted for UI through IDES, when can I expect to receive the first of
my unemployment benefits?

Claimants should receive their unemployment funds within three (3) weeks of their application. Once
unemployment application has been accepted by IDES, claimants should be sure to certify their request
to IDES online or by phone in order to expedite receipt of unemployment compensation through PUA.
Additional information about PUA unemployment benefits is available via the IDES website.
https://www2.illinois.gov/ides/Pages/COVID-19-and-Unemployment-Benefits.aspx

Q: Employees who work in a salon, barbershop, real estate, or other business that in the past has not
been eligible for unemployment benefits are they now eligible to receive unemployment under PUA?
Yes, unemployment benefits should be retroactive to the date the individual listed in their UI
application as the date they were laid off.

Q: If I was initially denied unemployment benefits due to my status as a sole proprietor or self-employed
applying for unemployment benefits for the first time, should I reapply for unemployment.

IDES recommends that claimants who have already applied for unemployment through PUA to hang
tight as the program will begin implementation on May 11. Individuals who have not applied for
unemployment should apply through the IDES website. Additional information about the unemployment
benefits currently available through PUA is provide in the April 15 DeKalb County UNITES webinar, which
can be accessed via the following link. https://www.youtube.com/watch?v=R7fU4EtpEgo

Small business updates, resources, tools, and tips for getting through this COVID-19 crisis.  

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This content is for information purposes only and information provided should not be considered legal, accounting or tax advice, or a substitute for obtaining such advice specific to your business. Applicable laws may vary by state or locality.  No assurance is given that the information is comprehensive in its coverage or that it is suitable in dealing with a customer’s particular situation.  Accordingly, the information provided should not be relied upon as a substitute for independent research. DeKalb County Unites cannot warrant that the material contained herein will continue to be accurate, nor that it is completely free of errors when published. Readers should verify statements before relying on them.