However, EDD suggests it is safer to do so. For businesses established after the fourth quarter of 2019, the SBA compares your second or third quarter of 2020 revenue to revenue from the first quarter of 2020. For a complete FAQ about the California COVID-19 relief grant program, please refer to this page: https://careliefgrant.com/50440-2/. Proceeds must be used for purposes approved by the SBA, which include: Improvements to property such as utilities, parking lots, street enhancements, and landscaping, Constructing new facilities or modernizing/renovating existing facilities, Buying machinery and equipment for long-term use. Thus, if you are a Schedule C filer whose gross income is greater than $150,000 and you apply for a PPP loan, the SBA may send you a Loan Necessity Questionnaire to verify that current economic uncertainty made the loan request necessary to support the ongoing operation of your business. Check with your lender for specific details on how they will accept applications. Refinancing business debt: If youve taken out a small business loan to fund your business, and the debt is currently on unreasonable terms (i.e. More information about PPP loan forgiveness can be found in the Loan Forgiveness section of the FAQ. Use r/TargetedEIDL for advance/grant issues. Create an account to follow your favorite communities and start taking part in conversations. For the formula to calculate the maximum PPP loan you are eligible for, see the Application Process section below. Borrowers with loans of $150,000 or greater will need to submit additional documentation to obtain forgiveness. A real estate agent has called out her landlord clients for jacking up the rent too much, with stunned tenants welcoming the 'brutal truth' of her comments. To identify which program(s) youre eligible for, work with your lawyer and an accountant like Wipfli. Payroll costs also do not include: Compensation of an individual employee in excess of an annual salary of $100,000; employer-side payroll taxes, railroad retirement taxes, and income taxes; any compensation of an employee whose principal place of residence is outside of the US; and qualified sick or family leave wages for which a credit is allowed under the Families First Coronavirus Response Act. Who Are Specialized Lenders in the SBA 7(a) Loan Program? Thank you SIC code 6531 isnt even right for my biz but thats what NAV shows so I guess thats what they will use. Copyright 2018 - 2023 The Ascent. Before taking out a loan, be sure to speak with a qualified commercial real estate broker to discuss all of the risks and benefits associated with this type of financing. If your business has been hurt by COVID-19, it may be worth applying for an EIDL loan. A California law passed on September 9 stated that expenses paid with forgiven PPP loan proceeds cannot be deducted for state income taxes. On June 17, 2020, the SBA posted a revised, borrower-friendly Paycheck Protection Program (PPP) loan forgiveness application implementing the PPP Flexibility Act. Borrowers with employees may have costs that fall into this category. This means that a borrower that chooses to file before the end of the Covered Period cannot contact the lender at a later date to mitigate any salary reductions after the loan forgiveness application has been filed. Independent contractors who have been adversely impacted by the COVID-19 emergency are eligible. I need help completing my PPP application. Additionally, realtors can use the loan to help small businesses find the funding they need to purchase commercial real estate in the first place. WebComplimentary Self-Defense Class for Real Estate Agents happening at David Hoffman Realty, 10715 Sikes Place, Charlotte, United States on Tue Mar 07 2023 at 10:00 am to hbbd``b`~$ *3z B $b .H "AG Its also a time to reflect back on. WebSBA Economic Injury Disaster Loans (EIDL) are eligible for Rental Property Owners. But you can qualify for those programs, even if you have no employees. endstream endobj startxref The grant amount will be based on the businesss annual revenue as documented in its most recent tax return. Since this amount (whether you used the gross income or net profit loan calculation method) is equivalent to the maximum PPP loan size for borrowers without employees, these borrowers are able to classify 100% of their PPP loan proceeds as forgivable payroll costs. This means sole proprietors without employees will all be able to get their PPP loans fully forgiven simply by filling out and submitting the one-page certification form to their lender. Real estate agents FIND A LENDER: Application period begins April 10th, Economic Injury Disaster Load Emergency Advance. If a borrower is going to claim on the forgiveness application that they tried to rehire an employee but the offer was rejected by the employee, the borrower is required to inform the applicable state unemployment insurance office of the employees rejected rehire offer within 30 days of the employees rejection of the offer. | Terms & Conditions, $20,833.33 initial loan and $20,833.33 second draw loan for independent contractors without employees. Businesses that have experienced substantial economic injury are eligible for an EIDL. Likewise, if your deep fryer goes on the fritz, or your roof springs a leak, youll have to rely on other funds to take care of those repairs. To apply for a PPP (Payroll Protection Plan), you must go through an approved SBA loan provider. Additionally, no collateral is required to obtain a loan, and there is no personal guarantee requirement. No. The SBA 504 loan is intended for the purchase and construction of owner-occupied commercial real estate. The SBA prohibits you from obtaining an EIDL loan if your business engages in any of the following activities: Other things that may disqualify you from obtaining an EIDL loan is if any principal owner with a 50% or greater interest in your business is more than 60 days late on child support obligations. Click here for our Advertiser Disclosure. Real estate agents can use SBA 7(a) loans for: Buying or maintaining a vehicle: Since real estate agents usually need to travel on a daily basis to meet with clients and show properties, an SBA 7(a) loan can be a great way to fund the purchase or repair of a business vehicle. No. Generally, receipts are considered total income (or in the case of a sole proprietorship, independent contractor, or self-employed individual gross income) plus cost of goods sold, and excludes net capital gains or losses as these terms are defined and reported on IRS tax return forms. 2054 0 obj <>/Filter/FlateDecode/ID[<8C8FAFB2856FD243BB76F15BC6E77F5A>]/Index[2030 41]/Info 2029 0 R/Length 108/Prev 228727/Root 2031 0 R/Size 2071/Type/XRef/W[1 2 1]>>stream PPP loans are offered on highly favorable terms for borrowers: They are forgivable, they are guaranteed by the government, and payments are deferred. The following options are available to brokers: Are California Relief Grants available for brokers from the state of California? However, it is possible the state law will be changed to conform with the new federal law. A borrower is eligible for loan forgiveness for amounts the borrower spends during a period which begins on the date the lender makes the first disbursement of the PPP loan to the borrower and ends between 8 and 24 weeks after disbursement of the loan (the Covered Period). If a member doesnt report loan proceeds and they are eventually determined to be reportable income, EDD may seek to recover amounts paid plus penalties. Homeowners, Renters, Business Owners: SBA Disaster Loans Key You must also provide a 2019 or 2020 IRS Form 1099-MISC (depending on which year you used to calculate your maximum loan amount) detailing nonemployee compensation received (box 7), or an invoice, bank statement, or book of record that establishes you are self-employed. Am I eligible for a PPP loan if I structure my business as an S Corp? Starting the week of April 6, 2021, the SBA is raising the loan limit for the EIDL program from 6 months of economic injury with a maximum loan amount of $150,000 to 24 months of economic injury with a maximum loan amount of $500,000. %PDF-1.6 % Paypal https://www.loanbuilder.com/ppp-loan-support, Kabbage https://www.kabbage.com/paycheck-protection-program-loans/, Divvy https://getdivvy.com/covid-19/sba-ppp-loans/assistance/, Credibly - https://sba.credibly.com/apply-online/?utm_medium__c=cpc&utm_source__c=google&utm_campaign__c=11-seg-brd-des&utm_term__c=11_bmm_credibly&utm_content__c=easy_responsive, Lend IO / Paychex https://www.lendio.com/, Biz2Credit.com / Paychex (may be requiring 2 or more employees) - https://www.biz2credit.com/disaster-support/cares-act-loans-coronavirus, Union Bank - https://unionbank.avoka-transact.com/workspace/servlet/SmartForm.html?formCode=ppp-loan, Square Capital - https://squareup.com/us/en/l/sba-ppp-loans, Intuit Quickbooks - https://quickbooks.intuit.com/small-business/coronavirus/paycheck-protection-program/, ReadyCapital - https://ppp.readycapital.com/. Before you apply for a PPP loan, it is important to review the options with your CPA or financial advisor. Great to put this video instruction and helping out. If youre an independent contractor, you may be under the impression that the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) program dont apply to you. Additionally, if the propertys value decreases, you could find yourself underwater on your loan owing more than the property is worth. There is nothing preventing a borrower from spending all PPP loan proceeds immediately upon receipt. A streamlined online application for EIDL loans has been made available by SBA at the following link: https://covid19relief.sba.gov/. Before you agree to a loan, be sure that you are aware of and understand EIDL loan terms and requirements adequately. An EIDL can help small business owners weather the COVID-19 storm. Will I need to pay income tax on the PPP loan proceeds if I use the proceeds for income replacement? WebAs of September 8, 2021, new COVID-19 EIDL policy changes took effect as follows: Maximum loan cap increased from $500,000 to $2 million. Step 3: Multiply the average monthly gross income or net profit amount from Step 2 by 2.5. Borrowers with loans greater than $150,000 will need to determine whether they can use the EZ version of the forgiveness application or if they must fill out the full version. The PPP loan program expired as of June 30, 2020, but was extended on July 4, 2020 to August 8, 2020 and there was approximately $130 billion available as of that date. All of the largest banks (such as JPMorgan Chase and Bank of America) are offering PPP loans. Applicants will be contacted directly by SBA via email in the coming weeks with instructions to determine eligibility and submit documentation. Real estate agents SBA Loans for Brokers | Coronavirus As real estate agents, we are exactly who these legislations were designed to help. The list of partners, organized by location and by language services, can be found here. Your calculation would look like this: Please note, if your Schedule C business took a loss prior to the COVID-19 pandemic and you had no employees, you will not be considered to have a salary for this calculation. Real estate agents can use SBA 7(a) loans for buying or maintaining a vehicle, refinancing business debt, and expanding a real estate brokerage. Eligibility requirements are fairly broad, so chances are good that your business will qualify if designated as one of the following: The 500-employee maximum applies to all the business types listed above. ECONOMIC RELIEF AND BENEFITS FOR REAL ESTATE AGENTS First, shop around! Using line 7 gross income will usually lead to a higher loan calculation, so it will be preferred for most sole proprietors. In addition to revising the full forgiveness application, SBA also published a new EZ version of the forgiveness application. eidl for real estate agents hello@sba7a.loans, SBA Loan ComparisonSBA 7(a) Loan Fees, Rates, and TermsQualifying for an SBA 7(a) LoanSBA Loan Guides per State, Privacy PolicyTerms of UseAdvertiser Disclosure. Where can I find a step-by-step guide for completing the application? Multifamily Minute Reader Reflections: When Do You Start the Refi Process? OpportunityZones Help. will update this section if the state law changes. How will this affect forgiveness? Commercial Real Estate Loans,SBA7a Loans, What assistance is available for brokers from the SBA? About COVID-19 EIDL Checking vs. Savings Account: Which Should You Pick? Step 2: Calculate the average monthly gross income or net profit amount (divide the amount from Step 1 by 12). How the Stimulus Package Helps Real Estate Agents This documentation can be submitted: (i) at the time of the loan application; (ii) on or before the date the borrower submits an application for loan forgiveness; or, (iii) if the borrower does not apply for loan forgiveness, at SBAs request. |, California REALTORS expect coronavirus to, https://www.sba.gov/paycheckprotection/find, https://www.loanbuilder.com/ppp-loan-support, https://www.kabbage.com/paycheck-protection-program-loans/, https://getdivvy.com/covid-19/sba-ppp-loans/assistance/, https://sba.credibly.com/apply-online/?utm_medium__c=cpc&utm_source__c=google&utm_campaign__c=11-seg-brd-des&utm_term__c=11_bmm_credibly&utm_content__c=easy_responsive, https://www.biz2credit.com/disaster-support/cares-act-loans-coronavirus, https://unionbank.avoka-transact.com/workspace/servlet/SmartForm.html?formCode=ppp-loan, https://squareup.com/us/en/l/sba-ppp-loans, https://quickbooks.intuit.com/small-business/coronavirus/paycheck-protection-program/, https://www.icba.org/about/find-a-community-bank, https://www.creditunionsonline.com/california-credit-unions.html, https://www.cdfifund.gov/Documents/CDFI%20Cert%20List%2004-14-2020%20Final.xlsx, https://www.sbalenders.com/most-active-sba-banks-in-2019-mid-year-review/, https://smartasset.com/insights/ppp-loan-lenders. This means that theoretically, businesses will not be able to take out dividends for over 30 years if they Click here to read our full review for free and apply in just 2 minutes. What are the eligibility requirements for a targeted EIDL advance? Construction and Real Estate, Please be advised the lists above may be amended at any time without notice. A borrower may submit a loan forgiveness certification or application any time on or before the maturity date of the loan, including before the end of the Covered Period, Since this amount (whether you used the gross income or net profit loan calculation method) is equivalent to the maximum PPP loan size for borrowers without employees, these borrowers are able to classify 100% of their PPP loan proceeds as forgivable payroll costs.. Loans are for a term of 30 years. Additionally, the American Rescue Plan created a new supplemental targeted advance program. are not eligible for multiple grants and are only allowed to apply once using their eligible small business with the highest revenue. To apply for forgiveness of your PPP loan, you must complete the certification and submit it to your lender. This website does not endorse or charge you for any service or product. Where can I find more information about EIDLs? Calculate your average monthly payroll cost and multiply that number by 2.5. WebThe standard, fair commission for a real estate agent is 6% of the home's sale price. real estate agent's Step 2: Calculate the average monthly amount (divide the amount from Step 1 by 12). Because an EBL loan is a bridge loan, first disbursement of the EBL loan must occur within 45 days of the lenders receipt of an SBA loan number. See Question 3A. hb```f`` P @1V@NTYaR |JRn:Z 3Ap {/#OyCmc.\3YEYYK)pK/a\/X"R%-&iRmR#P%,.3/ :) u8NeHsd"Hv"3]APD3Jt @d(b .H"J6GGa"+@Z%"EC!Qqp(@pM*00^x*Z;hh20j The SBA refers to this as owner income replacement.. PPP applications already reopened the week of January 11 for community development financial institutions. The SBA refers to this as owner income replacement. The borrower can spend the owner income replacement portion of the PPP loan on anything the borrower chooses. How can I apply for a targeted EIDL advance? For businesses established after the second quarter of 2019, the SBA compares revenue from any 2020 quarter to revenue from the third or fourth quarter of 2019. Additionally, per the SBAs Interim Final Rule, sole proprietors must have claimed or been able to claim these expenses as deductible on their 2019 or 2020 IRS Form 1040 Schedule C in order for them to be forgivable when paid with PPP loan proceeds. Note: Since SBA allows borrowers to use 2019 or 2020 payroll costs to calculate their maximum PPP loan amount for both first and second draw PPP loans originating in 2021, borrowers will want to use the year in which their payroll costs were highest to obtain the largest PPP loan amount. Consult with your accountant if you need assistance determining your gross receipts, and/or refer to SBAs FAQ document available, Once received, the loans may be used by brokers for payroll costs (including paid sick leave), employee salaries, insurance premiums (including health, group life, vision, and dental insurance premiums), rent expenses, mortgage expenses, utility expenses, PPE expenses, operations expenses, property damage costs, supplier costs, and other debt obligations. The program provides micro grants ranging from $5,000 to $25,000 to eligible small businesses (including independent contractors and sole proprietors) impacted by COVID-19 and the related health and safety restrictions. The Economic Injury Disaster Loan or EIDL is designed for businesses with fewer than 500 employees. Since the form is already provided by the borrower at the time the PPP application is submitted, no additional documentation will need to be submitted by the borrower to obtain forgiveness for the portion of the loan used as the borrowers income replacement. Note: For second draw PPP loans, sole proprietors have the option of calculating average monthly payroll costs based on the 1-year period before the date on which the loan is made rather than the 2019 calendar year. However, be aware that many of these lenders will only be accepting applications from customers that have a pre-existing relationship with the lender, and/or the lender will be prioritizing applications from those customers. Texas Property Tax Loans | Help with Delinquent Property Taxes Will this affect my PPP application? For small businesses impacted by COVID-19, an EIDL offers some distinct advantages that you should take into account when deciding whether to pursue the loan. Payroll costs (including paid sick leave), employee salaries, rent expenses, mortgage expenses, utility expenses, PPE expenses, operations expenses, property damage costs, supplier costs, insurance premiums and other debt obligations. Use r/TargetedEIDL for advance/grant issues. With the adoption of the CARES Act II on December 27, 2020, Congress appropriated additional funds for the EIDL emergency grant program (which had previously run out of funds). In 2020, the CARES Act II reopened the PPP program for those who hadnt taken a PPP loan in the first round, as well as providing for the second draw PPP loans discussed below. The EIDL loan application is streamlined for easy completion. Any EIDL Advance Amounts previously deducted from a borrowers forgiveness amount will be remitted to the lender, together with interest to the remittance date. Real Estate Agents and Managers. What are the risks if I do? My Blog eidl for real estate agents Lastly, and very importantly, the SBA instructs that before applying for a PPP loan, borrowers should consider whether their potential access to other sources of liquidity ultimately makes a PPP loan unnecessary to support their ongoing operations. The best option is to contact the lender to arrange returning any portion of the loan in excess of what can be forgiven. between $1,000 - $9,000) and will later reach out to those who applied for EIDL assistance on or before December 27, 2020 but did not receive an EIDL advance due to lack of program funding. Since the definition of payroll costs includes employee salaries, wages paid by an S Corporation will be considered payroll costs that can be covered by PPP loan proceeds. Real estate brokers: Can you qualify for a PPP loan? And All EIDL loans carry a term of 30 years, with an interest rate of 3.75%. There is currently no official guidance from the EDD as to whether PPP loan proceeds need to be reported as income when you are certifying for PUA or UI. To further ensure PPP loan forgiveness, its important to keep detailed records so you can track where the funds went. When can I submit my loan forgiveness certification or application? Please check this FAQ frequently for updates. Its available to small businesses, small agricultural cooperatives, and most private nonprofits in a disaster area that have suffered substantial economic damage. The SBA will reach out to those who qualify to explain how to receive a targeted EIDL advance. The remainder of the loan that is not forgiven (if any) will operate according to the loan terms described in the Loan Terms section above. Create an account to follow your favorite communities and start taking part in conversations. EIDL Loan Borrowers should calculate their maximum loan based on both options to determine which option will provide them with the largest maximum loan. How long will it take for me to get an EIDL after I apply? No. 0 No. Between March 2020 and February 2021, SBA provided about 3.8 million low-interest EIDL loans and 5.8 million grants (called advances) totaling $224 billion to help If the full principal of the PPP loan is forgiven, the borrower is not responsible for the interest accrued. Information is available at careliefgrant.com in addition to the information in this FAQ. Eligible utility costs include payments for a service for the distribution of electricity, gas, water, transportation, telephone, or internet access for which service began before February 15, 2020. In addition, the loan immediately goes into deferment, so you have a year before you need to start repaying the loan, although the SBA gives you the option to start repaying it immediately. Owner Income Replacement is capped at 2.5 months worth or $20,833 per individual, whichever is less, for a 24-week Covered Period. Once received, the loans may be used by brokers for payroll costs (including paid sick leave), employee salaries, insurance premiums (including health, group life, vision, and dental insurance premiums), rent expenses, mortgage expenses, utility expenses, PPE expenses, operations expenses, property damage costs, supplier costs, and other debt obligations. When will I know if my PPP loan is forgiven? Government guarantee of a loan means that the government assumes the debt obligation for the loan if the borrower defaults.