Payroll Protection Loans have been a godsend for clients businesses. They were stressed out about money before this loan came through. All of my applications were successful. Last week I attended an online seminar in what's required to have the loan forgiven, so it becomes a grant.
You have exactly 2 months to the day from the time the money was deposited to "use" the money, so being proactive is key.
I decided to track the money coming in as income, using the class feature in QB so that I can produce a Payroll Loan P&L for the bank. If you don't pay income taxes on the loan/grant, you also can't deduct related expenses. Since I hope to have 100% of the loan forgiven, there is no advantage to classifying it as something other than income.
Whatever is not forgiven, you'll have 3 years to pay it back at 1% interest, which is better than most loans.
This is how it pays to have me as your accountant. Unlike business owners I think about this stuff all the time. Plus, I spend loads of time doing research, attending seminars, talking to other business owners who have the same problems, and making sure I'm in the know, so you can make your business more profitable.
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