PPP loan forgiveness- single employee

Do we literally write oneself a check to yourself ?

Lots of self employed don’t even have an LLC. Just Jody pays Jody. I love America.

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If you do this approach you will be greatly disappointed at the end of 8 weeks. You should do a little more homework on sole prop forgiveness

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You going to share anything for us to do “homework” on?

FWIW - my father is a CPA and has advised his Sole Proprietor clients that file via schedule C to just pay yourself from the PPP account in reasonable draws over the 8 weeks.

The updated guidance from the SBA still isn’t entirely clear. Either way. The maximum amount that wouldn’t be forgiven for a SoleP would be $5,208 at 1% payable over 24 months. Meh.

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If you do this approach you will be greatly disappointed at the end of 8 weeks. You should do a little more homework on sole prop forgiveness

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This is such a helpful response.

Ended up getting my ppp through Square who processes my credit card payments (they partnered with a bank to handle it).

My issues is the same as your's, but I feel a bit more confused. Here's the FAQ that Square provided me before signing up. Scroll down to "Can my PPP loan be forgiven in whole or in part?"

I, too, am a single member LLC and under the FAQ linked above would qualify as a non-employer (just have a lot of 1099 help). According to it, the loan can be spent on any category of business expense over the 8 week period consistent with similar expenses in 2019 OR certain schedule C categories.

However, in the note that they sent me, the loan forgiveness portion just has the boilerplate language as if were an employer.

Of course trying to talk to anyone from the lender has proven fruitless. Same with CPA as the best I get is "we're not really sure."

So, Im4datigers, please direct me into an area where I can research and figure this thing out myself. I've read through the bill, and it really doesn't help. The SBA's "guidance" is also pretty ambiguous.

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There are some links/blogs out there that say that make the assumption that "payroll" forgiveness for SoleP - SchC filers is limited to 75% of the funded amount. With the remaining 25% being required to be spent on rent, utilities, & interest. But nothing official from SBA.

Even if this is the case, and your SoleP can only get forgiveness on the 75% of "payroll" you can either: A. repay the 25% back immediately or B. borrow it for 24 months at 1%.

Since the calculations were capped at $100k per employee, a SoleP could only receive a max PPP loan of $20,833. Meaning that 25% of the max would be $5,208 at the 1% over 24 months. Hardly being "greatly disappointed"

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Right, I think I'm just going with that approach as well and will pay it back over time.

I do wish there was greater transparency on the whole process, but I guess that could be said for everything from the government right now. Just seems like another thing in a long line of "this sounds good so lets pass it but damn if we know the long term plan."

The interim rule for PPP that discusses sole props / Sch C's says basically these companies will be assumed to have spent 8/52nds of 2019 Sch C net income on owner compensation during the covered period (basically 75% of what they get). Remaining 25% then for utilities, mortgage interest, rent.

Many sole props don't have those expenses, so, likely many will end up with 25% as a loan.

What about office in home, can those expenses count? Waiting on guidance on that.

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f you do this approach you will be greatly disappointed at the end of 8 weeks. You should do a little more homework on sole prop forgiveness

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You don’t know anything

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I've read guidance that yes, those expenses do count - assuming that you had those expenses on your 2019 Sch. C. Same with utilities, mortgage interest, and vehicle interest. As long as you were claiming those expenses on your previous taxes and not trying to do it now for the first time, you are good.

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I know it's clear you can do that if those expenses were paid for and direct expenses of the company. Have you seen something that directly allows the percentage of those expenses that would appear on the office in home schedule? If so, can you send me a link?

So in the end he thinks you can keep 100% or 75%?

I bet a free 15k from the government during a pandemic wasn’t in the budget either but hey. It’ll be alright