The clock is ticking. Assuming your office has been closed for more than a month, what can you do now to maximize the loan forgiveness?

The first step is to determine if you will be able to fully staff up by 6/30/20 to qualify for the Safe-Harbor described above.  That means both your staff hours and staff wages need to equal or exceed 2/15/20 levels by that date.

If you will be able to hit that threshold, start by taking yourself off unemployment and paying yourself a salary of $15,385 between now and the end of the 8-week coverage period. Also pay the health insurance and retirement contributions for you and your staff during the coverage period. Paying your rent and utilities during the coverage period or prior to each bill’s due date following the coverage period will help max out the non-payroll costs.

And of course, hiring back your staff sooner versus later will also help you maximize the amount of the PPP loan to be forgiven, since that was the purpose of this forgivable loan anyhow.

If hitting both Safe Harbor thresholds is out of the question, the amount of the PPP loan to be forgiven might only barely exceed the EIDL Grant you received. In that case, it’s probably a toss up as to when you take yourself off unemployment and hire back your staff.  Unfortunately, most of the PPP may not end up being forgiven.

Either way, we have prepared a very user friendly Excel Spreadsheet to help you figure out how much of your PPP loan will be forgiven. You can download that spreadsheet at: https://www.schwartzaccountants.com/wp-content/uploads/2020/05/PPP-Forgiveness-Calculation.xlsx