Cybersecurity at Home and Current PPP Updates

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  • 10/8/2020
  • Virtual

To celebrate Cybersecurity Awareness Month, join this week's livestream as we discuss how to reduce cyber risks for yourself and your organization while working remotely. We will also discuss PPP updates and answer your most recent questions.

Speakers:

In case you missed it: 

 

Questions and Answers:

How will the FDIC see the SBA guidance about deferring the PPP loans.  When they audit us, they are looking at exactly what our documents say – has something been cleared with them in regards to the PPP loans so that we do not need to provide new documentation?

We’ve been in communication with the banking regulators on PPP matters throughout the process. Our understanding is that they view the deferment of PPP loans much like government-mandated deferments (example: states have the ability to mandate forbearance and/or deferral periods for residential mortgages). Thus, new documents should not be expected by the agencies when they conduct their examinations.

Do you take the forgiven loan in 2020 or 2021?

The loan is picked up in income in the year the forgiveness is approved by the SBA.

If you forgive the loan in 2021, will it go to other income or reduce payroll expense?

For book purposes, it goes into other income. For tax, while it is “nontaxable,” you reduce deductions, effectively making it taxable income.

One exemption from FTE reductions is if a business was unable to operate at the same level of business activity as before Feb 15, 2020 due to compliance with requirements from HHS, CDC, etc. In Minnesota (and many other states), certain businesses could not operate due to an executive order by the Governor. Do you think this executive order would fit within the spirit of this exemption?

The executive order seems to fit in the spirt of the exemption. We recommend documentation of the exemption.

You’re talking about companies that are being bought. What if you are closing your business? We received back in March $317,000. Any concerns on that?

The M&A rules are really meant to prevent changes in control which suddenly disqualify the ownership. We still recommend consulting with the bank if you are liquidating the entity for any implications.

 

For more information:

  • Heather Kloster
  • Marketing Senior