Small business disaster loans

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financial.freedom
Posts: 529
Joined: Fri Oct 03, 2014 1:18 am

Small business disaster loans

Post by financial.freedom » Wed Mar 25, 2020 9:36 am

A lot of businesses are struggling right now. We're still operational but expecting a payroll hit of 50% this month and maybe more for the next few months. Online, I see loans through the federal government for disaster relief. It looks like the rate is 3.75%. But I don't see the specifications for type of business.

We're set up as a C Corp, mostly physicians, and operate mostly professional services for outpatient imaging and outpatient procedures (most of which are being cancelled or rescheduled for the near future).

Any advice greatly appreciated.

This is all I've found so far:

https://www.sba.gov/disaster-assistance ... s-covid-19

veindoc
Posts: 660
Joined: Sun Aug 14, 2016 9:04 pm

Re: Small business disaster loans

Post by veindoc » Wed Mar 25, 2020 5:44 pm

So far that’s it. Which is very unsatisfactory in my opinion. This new stimulus bill from what I read will provide 10,000 grants with additional loan options and possibly tax credits. Seems the tax credit is contingent on not laying anyone off. I am holding on to my staff for now although there is little for them to do to see what I can qualify for. I can’t afford to do this for very long so we will see. Hope to have some clarity soon once Trump signs on the dotted like. What I have done is signed for the sba website and prepared the PFS, has returns in hand etc waiting to be the first to apply.

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AerialWombat
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Re: Small business disaster loans

Post by AerialWombat » Wed Mar 25, 2020 6:26 pm

The gist of the SBA emergency loan application process is that you need to be able to demonstrate a direct correlation between COVID-19 and a loss in revenue. For certain types of businesses, especially in hospitality (bars, restaurants, travel agents, hotels, brothels, etc.) this is easy to demonstrate. For many other businesses, it can be difficult. You also need to be able to demonstrate that you need the money in order to cover overhead expenses that you cannot pay due to the revenue loss. You should get together with your accountant in order to create the necessary pro forma financials.

Topic Author
financial.freedom
Posts: 529
Joined: Fri Oct 03, 2014 1:18 am

Re: Small business disaster loans

Post by financial.freedom » Sat Mar 28, 2020 10:37 am

AerialWombat wrote:
Wed Mar 25, 2020 6:26 pm
The gist of the SBA emergency loan application process is that you need to be able to demonstrate a direct correlation between COVID-19 and a loss in revenue. For certain types of businesses, especially in hospitality (bars, restaurants, travel agents, hotels, brothels, etc.) this is easy to demonstrate. For many other businesses, it can be difficult. You also need to be able to demonstrate that you need the money in order to cover overhead expenses that you cannot pay due to the revenue loss. You should get together with your accountant in order to create the necessary pro forma financials.
Thanks for the reply. This should be pretty easy to do. Guidelines from CDC and policies passed down from admin led to cancellation of almost all non-urgent cases (completely closed the breast center, so no mammograms etc. -- patients cancelled their imaging and routine biopsies). Overall, business is down about 60% and could be worse during the month of April. I'm happy to have a job, but it could end up to the equivalent of working without pay for a few months just to keep paying the staff.

I've also heard that there are limitations with payroll (up to 100k) but will have review it with our accountant. If anyone has tips from things they've come across in the legislation please let me know. I'll try to read through more threads and see what other BH are doing as well.

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