PPP

[jim_wakem]

I HAVE A CLIENT THAT IS SELF EMPLOYED AND WANTS TO APPLY FOR A PPP LOAN. I AM DRAWING A BLANK AS TO THE REQUIREMENTS FOR S/E PEOPLE ON THIS MATTER NEED HELP

[Just-Lisa-Now-]

Im sure the application has some kind of instructions as to whats required, no?

[sjrcpa]

I think SBA said the money ran out today.

If not, go to the SBA website, look for PPP and you'll be able to find the answers.

[Just-Lisa-Now-]

I saw that they were tapped out as well.

[qbteachmt]

You can google:

sba ppp requirements for self employed

[jim_wakem]

THANKS 

[ritastone001]

Your clients will need a copy of their self employment forms, C, F, or I believe E. 2019 or 2020. If there is still money in the funding, the program is suppose to be open thru May 31. They take their forms to the loan officer of any bank etc that is working with the SBA.  The amount of the loan will be based on the total income of the self employment. 

[PATAX]

The loan officers at the financial institutions I believe are making Hefty commissions on this... Maybe they can help your client... just my opinion

[sjrcpa]

The banks get fees from the SBA. Do banks pay the loan officers commission?

[PATAX]

@sjrcpa what I meant to say did not come out completely correctly in that post... You are correct the financial institutions receive the fees... and the financial institutions pay their employees... Thanks sjr👍

[Greta]

My bank manager client said the bank makes $250 per application they process. That seemed low to me.  I helped 110 clients receive PPP funds smoothly and quickly, they were enormously grateful, this is a poor community. The money has now run out. It was amazing how few people took advantage of the program through lack of knowledge. All I did was email a PDF copy of their tax return, business license, driver license, and Forms 941 if any to my bank contact. That's all I did for 2 weeks, but I felt I owed it to our community on a volunteer basis. Now my office looks like a hospital room full of flower bouquets, I'm too embarrassed to say I'd rather have chocolates.

[PATAX]

@Greta @sjrcpa 👍👍per New York Times article "Banks collected at least 13 billion dollars in fees on paycheck Protection Program loans according to a New York Times analysis"... just my opinion.....

[qbteachmt]

"this is a poor community. The money has now run out."

Not all of them.

https://www.cnbc.com/2021/05/05/ppp-has-run-out-of-money-for-most-borrowers-what-to-know.html

"Going forward, the program will only accept new applications from community financial institutions, which typically serve minority borrowers, as about $8 billion in funding was set aside for such businesses."

[Greta]

Thanks, I was not aware. Our community is poor, white & rural, not really minority category?

[Greta]

I religiously read the NY Times, they must be right. I did the basic legwork for my 110 clients, if the fee was a mere $250, that's still $27,500 income for one small-town bank in 2 weeks. So multiplied many times over by big banks and more than one lowly tax preparer, billions sounds right. I figure approx. one million dollars came to this community and will be spent in this community, thus stimulating this area. However, quite of few of the self-employed people got the PPP funds just in time to pay their chunk of taxes, so some of this PPP money is going back to where it came from.

[PATAX]

Greta, Per article in ABA banking journal dated 02/08/2021: "For first-draw PPP loans made on or after Dec. 27, 2020, lenders will receive processing fees in the following amounts: 50% or $2,500, whichever is less, for loans of not more than $50,000; 5% for loans of more than $50,000 and not more than $350,000; 3% for loans of more than $350,000 and less than $2 million; and 1% for loans of at least $2 million." "For second-draw PPP loans, lenders will receive a 50% processing fee or $2,500, whichever is less, for loans of not more than $50,000; a 5% processing fee for loans of more than $50,000 and not more than $350,000; and a 3% processing fee for loans above $350,000." …. Hopefully no typos there.....Go on to their website, bankingjournal.aba.com and you can read the whole article yourself....just my opinion….

[Greta]

Wow, those are huge fees! It sounds like the bank mgr who told me $250 forgot a zero at the end. I did think $250 sounded low. So... the 110 clients I handed to a local bank (a different one, where a super-diligent loan officer works, who even responded to me on the weekend) earned the bank nearly $275K? Wow. (I worked for free.)

[sjrcpa]

Thanks for looking that up. I knew it was good money. And when accountants could get part of that as an agent fee, most banks declared they were not willing to share the fee.

[User FIDO 61]

[PATAX]

@Greta 👍 that is okay Greta... God will remember what you did... I am not a theologian but I believe every good deed is rewarded by God and every sin is punished by God... But that is just my opinion...

[Greta]

Such sweet words, thank you. I myself am an atheist, but believe as you do in good deeds. Good for its own sake, as my parents emphasized in our atheist home. Besides, this makes this profession meaningful. Otherwise it's like playing a game with arbitrary rules, pass Go, collect $200, one way I explain Form 8880 to clients.