The Cares Act 2 – What it Means for Livingston Parish Businesses

Local Leaders: The Podcast Special Edition

In this SPECIAL EPISODE RELEASE of Local Leaders: The Podcast, Jim Chapman breaks down the 5600 page CARES Act as well as the second stimulus check plans.

President Trump signed this bill into law late Sunday and this is a must watch episode for any small business owner but especially those in Livingston Parish.

Thank you to these folks for supporting Local Leaders: The Podcast

hey i want to welcome everyone to a special edition of local leaders the podcast today we’re going to be talking about the stimulus package that president trump signed on sunday i thought this was a great topic for us to discuss primarily because trump well really the bill in general had a lot of differences between the first stimulus package uh especially when it relates to ppp loans and i wanted to just kind of help where i could i’ve really dived deep into this bill and so for the next few minutes i’m going to be covering uh some important things for business and really some important things in general about what you can expect from this 900 billion dollar package that was signed on sunday by president trump so i’m going to jump right into it we’re going to talk about the individual payments first and uh i’m working with some new equipment so hopefully this is all working somewhat correctly uh in the new office that we have set up for podcasting here at local leaders the podcast we look forward to bringing you some great things in 2021 so let’s start with individual payments i’m sure most of you are aware there was a stimulus simula similar to the first stimulus package released in which everybody is getting a check similar to the first time the the monetary is a little bit different uh it’s going to be 600 checks for individual adults uh or if you’re a married couple twelve hundred dollars of course this all hinges on your 2019 tax return obviously we haven’t closed out 2020 yet so they’re just like the first time they’re basing everything off of the 2019 return so it’s 600 for an individual 1200 for couple and then 600 for all eligible dependents uh if you have two kids and two adults you’re looking at around uh well that’s twenty four hundred dollars so twenty four hundred dollars for a family of four um now there is a limitation to that with regard to

the amount of money in which you make so you have to have an agi a adjusted gross income 151 000 per year i believe it is uh to qualify for the full amount anything over that that amount uh as far as couples are concerned uh you lose i think it’s five dollars for every hundred dollars that you make over that amount uh if you’re a single you have a cap of a hundred and twelve thousand five hundred dollars based off of your adjusted gross income in 20 2019 rather eligible families with dependents as i said would receive an additional 600 now you also have an unemployment benefit that’s part of this package a lot of people uh wondering about that of course that was a big debate the first time around because the unemployment benefits were so high that a lot of people were making more money by staying out of work so this time around you’ll still get an enhanced unemployment benefit federal benefit of 300 per week rather than the 600 a week the first time around so it’s half of what it was the first time around at 300 per week on that stimulus now that’s an addition to what your state already gives you so if you get i don’t know two hundred dollars a week typically uh you’ll get two hundred dollars still from the state and then you’ll get an additional three hundred dollars from the federal government education resources were part of this bill this bill actually provided 82 billion dollars for education 54 billion of that for k-12 and 23 billion for state colleges and universities such as louisiana state university and baton rouge uh and then 54 billion for the for the k through 12 schools uh they’re going to use this a lot of them are under financial strain right now and hopefully that will help uh those schools now they’re getting uh some funding for broadband infrastructure this is something i actually uh was happy to see the issue the first time around with regard to the stay-at-home order was uh people were were their kids were having to stay at home and they either had no broadband or they had very limited broadband so they couldn’t access the internet at a high speed it was causing problems with them actually being able to attend school and and get even that type of education online because they couldn’t stay on the internet they were getting kicked off or or the the internet was very slow so the legislation includes 7 billion for expanding access to high-speed internet connections and half of that will go towards helping low income families cover the cost of internet bills they’re gonna basically give them fifty dollars a month up to fifty dollars per month uh to apply towards the internet aspect of their bill uh the deal also set aside 300 million for building out infrastructure in underserved rural areas uh you know if you live in the sticks or the boondocks somewhere and you don’t get very good internet uh this deal will set aside 300 million for i guess additional cell phone towers things like that where this in building out infrastructure maybe they’re going to run some fiber something like that so that you can get broadband in your area that was a big complaint

first time around targeted aid for small business so and this is what i really want to get into the agreement set aside 285 million dollars for additional loans to small business under the paycheck protection program or as all of us know it the ppp uh essentially renewing the program created under the original uh stimulus legislation now there’s a lot of differences between this one and the first one which i kind of expected because we saw some problems with uh the first go round for example first go around uh they had a 10 million dollar cap on ppp loans they have lowered that to two million dollars this uh their thinking is i believe in the legislature that if you loan only two million versus 10 million you’re gonna have more money to go around even though the stimulus is a little bit smaller than the first time around so uh so that’s the reason for the cap now here’s another change uh they’re only making this available to bars with less than 300 employees and not only that you have to be a private company if you are a publicly traded company you will not be eligible to take the second ppp loan of course that was a big issue of discussion the first time around you had some really successful public companies that were doing some creative uh things to qualify for these loans and they had no limitation on whether you could be a public or private company so i was happy to see that this is all going to be dedicated to private companies less than 300 employees uh and and hopefully it’ll get into the hands of of people that need it um so they’re only making it available to people with less than 300 employees now uh here’s another caveat you have to have shown a 25 drop in sales from a year earlier to your last quarter so in other words if you use the third quarter of 2019 and you say you know here’s how much say you’re a restaurant here’s how much beer we sold or a bar rather here’s how much beer we sold and then in 2019 you sold this much beer and it was 25 percent less you qualify for the loan but you have to use the same quarter you can’t compare a summer quarter to a winter quarter so say the second quarter to the fourth quarter in 2019 versus 2020. it has to be from the previous years same quarter and it has to be at least a 25 drop so that uh you have to show you have to show paperwork of that and uh in order to even apply for the loan so if you’re if you’re a company let’s say you’re private let’s say you have 200 employees and not 300 but let’s say you made a profit you know uh you’ve been turning profits even or your losses are only 20 you don’t you cannot uh qualify to to get a loan through the ppp um so keep that in mind now the agreement also set aside 12 billion dollars specifically for minority owned business and as i said earlier publicly traded companies will be ineligible to apply this time around this bill also had some funding for vaccines in nursing homes so the legislator legislation set aside nearly 70 billion dollars for a range of public health measures they include 20 billion for the purchase of vaccines 8 billion for vaccine distribution and 20 billion to help states continue their test and trace programs they gave child care some help so the bill also provided 10 billion dollars for the child care industry and they want to use those funds to help providers that are struggling with reduced enrollment obviously with the stay-at-home order a lot of people were just keeping their kids at home watching their kids there and honestly daycares and things like that were not even open during that time uh but this will this 10 billion dollars will go towards paying staff things like that at child care facilities and they’re also supposed to allocate some of these funds to help families that are struggling to make payments for child care so i’m sure you can get more information online on on that sounds like a good thing uh support for climate measures kind of uh i’m you know i’m not against wind solar clean energy all that sort of stuff just found it kind of strange that it was in a stimulus bill uh but it’s there and uh and it allocates 35 billion with 35 billion dollars to fund wind solar and other clean energy products projects rather so do what you want with that now there they also have in this legislation a ban on surprise medical bills so this bill makes it illegal for hospitals to charge patients for services like emergency treatment by out-of-network doctors or transport in an air ambulance where patients often have no say about it so say they’re unconscious a helicopter comes picks them up brings them to the hospital and that bill is you know 10 grand or whatever it is uh that’s deemed illegal now uh if they don’t have a choice on how they’re gonna be transported uh you can’t uh charge them for it hopefully that doesn’t cause a situation where you know they don’t call a helicopter out when you really need it just because they’re worried that they’re going to get paid or whether they’re going to get paid but anyway that’s in the bill rental protections this is something that’s had a lot of debate lately uh the they basically have in this bill an extension on the moratorium on evictions for another month so it’s going to run through january 31st um you know i wonder on that side of the bill you know you got to feel for these landlords too because if they’re not getting paid their rent um how are they supposed to survive so that’s a that’s a question this is that’s a very sensitive subject but it is what it is and right now in that bill that that was signed by trump on sunday evening president trump the rent uh moratorium on evictions they have extended until january 31st or through january 31st food security this was something i found uh that was a good part of this bill so the agreement increases um uh snap which is the supplemental nutrition assistance program they they’re increasing that by 15 percent beginning on january 1st so uh there’s a 15 increase and that’s going to last six months so that will put it through the end of june it also provides 13 billion for increased nutrition assistance 400 million of which will support food banks and food pantries this is the part that i i agree with and and i think it’s a good thing so 13 billion dollars for food banks and food pantries uh excuse me 400 million of the 13 billion will support those and they’re also doing an additional 175 million dollars earmarked for nutrition programs under the older americans act meal on wheels basically and i think that’s a great thing they’re going to give an additional 175 million dollars and they’re going to ear market just for programs such as meals on wheels 267 billion dollars as i discussed is allocated for those ppp loans and then i want to talk kind of directly about that since that’s that is the business part of this bill so 25 billion is reserved for businesses with less with 10 employees or less first time around a lot of companies that were four or five eight million operations felt very left out um as a matter of fact they did get left out in a lot of cases because a lot of the money uh was already given to larger companies so they’re taking 25 billion and try to rectify that they’re saying we’re you’re marking this only for businesses with 10 or fewer employees obviously private companies now eligible businesses that got a ppp loan the first time around can still apply for a second uh a second round of ppp and here’s the key to apply for the loan the business must have less than 300 employees and have experienced the 25 decline in gross receipts in any quarter in 2020 compared to the same quarter in 2019. we discussed this earlier but i’ll cover it again if you had in the third quarter of 2020 a 25 loss and in the third quarter of 2019 you that’s what you were comparing it to so you lost you you had a 25 you were down 25 in 2020 versus 2019 in that same third quarter you qualify um but it has you have to compare that to the same quarter so keep that in mind loans cannot exceed two million dollars and all loans to all borrowers from both the first and second round cannot exceed 10 million so if you borrowed 9 million the first time around you can’t borrow another 2 million you can only borrow a million uh the loan cap is two and a half times your average monthly payroll for 12 months and it runs through the date of application so when you apply whatever your average monthly payroll is as of that day you can apply for two and a half times that amount for accommodation and food service businesses however they are increasing this to three and a half times the monthly payroll not to exceed two million dollars so three and a half times if you’re if you’re a bar or a food service type business or an accommodation business like a hotel you can get up to three and a half times the monthly payroll average the covered period for new loans so these ppp loans you have to have filled out your application by march 31st of 2021 keep that in mind another good thing about the ppp this time around is not-for-profit business leagues chambers of commerce real estate boards uh boards of trade or professional football leagues which were previously not eligible for ppp loan loans on the first go round may apply but there’s caveat to that you have to have 150 or fewer employees less than 10 percent of your gross receipts have to come from lobbying activities so uh if you have any more than 10 of your gross receipts coming coming from lobbying activities you you don’t qualify so the good thing is the first time around with chambers and of commerce and things like that they were kind of left out they’re not left out of this one they are in there now there’s a new amount for the second draw loans then i’m gonna revisit again uh this is important two million dollars that’s it you can’t like i say the first time around it was 10 million 2 million this time so a lot of people asked asked me about loan forgiveness with the new pp loans now as with the previous loans the new loans will be entirely forgiven if they’re spent for the proper purposes what is that well you have to spend at least 60 percent of the proceeds on payroll at a minimum you may also spend up to 40 percent on other qualified expenses during the cover period so non-payroll expenses like utilities interest mortgage interest rent those you can you can spend up to 40 on that no more than that if you do that and you spend 60 percent on payroll that loan will be forgiven covered worker protection expenditures will include payments for personal protective ppe equipment and adaptive investments to help bars comply with federal health and safety guidelines now for any loan um getting back to this forgiveness for any loan up to 150 000 the covered loan amount will be forgiven but you’re gonna have to submit a one page on online paper form and i’m sure they’ll have this up and ready to go but you’ll have to submit a one-page form listing the loan amount the number of employees you retained and the amount of the loans spent on payroll and uh there once this new bill i think they have to release us within seven days of president trump passing it so by sunday of this week that should be

to where you can download it online so i tried to think about some questions maybe like some frequently asked questions that people may have regarding the stimulus checks since that affects everybody business owners and and non-business owners people that work for business owners so i’m just going to cover those uh frequently asked questions when will you receive your check guess what they’ve already today as a matter of fact i think last night they started popping these in people’s accounts they started mailing out checks i would say the week of the fourth through the eighth of january is when these are really going to start hitting a lot of people’s accounts so be on the lookout for that as we said as i said twelve hundred dollars for a couple six hundred dollars for dependents or six hundred dollars for a single adult and six hundred dollars for your dependents this is all based off your 2019 tax return well what if the irs doesn’t have my banking information they don’t have a direct deposit banking information for you unlike the first time around where they had something online that you could go and actually key in your banking information they’re just going to automatically send you a check it will not be like last time last time you know it was six eight weeks before a lot of people got checks um this time they have a deadline they have to have these out and really in your hands by january 15th so by january 15th you should you should have been paid one way or the other if you’re not look on the irs’s website that’s who’s in control of all this and uh and you can get your options from there how will they be sent same way as the first stimulus checks if you got a paper check last time and the irs does not have your account information you’re going to get a paper check this time they’re not even going to check with you they’re just mailing it wherever they mail the other one so be on the lookout for that now what if you’ve closed your account since the last stimulus well they’re going to go ahead and they’re going to submit whatever information they have for you if at that time your account is closed they’re going to get something back saying you know jim chapman’s account is closed and at that point they’re automatically going to mail you a paper check they’re trying to get these out of their hands as quickly as possible

so hopefully that answers your question on that do the stimulus checks count as taxable income no they do not there’s no need to claim them as income and they do not count as taxable income just keep in mind with these checks when you’re determining what you’re going to get you base it off of your 2019 agi your adjusted gross income and that’s going to tell you what you’re going to get so if you had a child in 2020 this is a good question if you had a child in 2020 will you get a check for that child no you will not because the irs doesn’t know you have a child they’re basing it off of your 2019 return but you can claim the 600 check additional with your 2020 return irs will have information as it updates on that adult dependents are disqualified from the six hundred dollars it’s very unfortunate so if you have a parent maybe this you’re taking care of this parent for whatever reason um elderly parent for example uh and this is different than the first go round they are disqualified from the 600 uh as a dependent now i am not sure if they’re gonna get a check themselves in their name i would imagine they would but it will not go to the person taking care of them more information on that i’m sure will be updated but the first go-around if you’re if you were taking care of an adult dependent you got an additional you got additional money for that i think it was 500 the first go round if you owe back taxes or child support you will still receive the 600 even in the event of a bankruptcy proceeding you’re still gonna get uh the stimulus check they are garnish proof here’s one uh interesting for you prisoners will receive a second stimulus check interesting caveat on that the first time around prisoners did not receive a stimulus check can’t say i disagree with that we pay a lot of money to jail criminals and uh well they threw a fit because they they were a citizen and they did not get a check and they sued the irs because the irs held their checks back the irs took them to court and the irs lost uh as the supreme court voted that there was nothing in the bill saying they didn’t get a check therefore they get a check well there’s nothing in the second bill either so to answer that prisoners will indeed receive a second stimulus check thanks for watching i hope all this helped i wish everyone a great january 1st holiday happy new year to all of you i hope everybody had a great christmas we’ve got a great 2021 coming coming to you tommy sigmund will be my uh my next upload he’s already been the guest but i held him back a little bit because his story is so important i wanted to make sure that people weren’t uh you know partying hard for for new year’s eve and new year’s day and and didn’t have time to catch his podcast which will would typically be uploaded on uh on friday so being that that’s new year’s day uh we’re gonna hold that off until monday but look for that he wrote a book called the greatest advantage uh he is a foster a child of the foster system 17 now but he wrote this book when he was 15. just an amazing individual gonna have him on the show monday and uh recommend that you check that out so thanks again for watching we’ll see you right after the holidays have a great holiday see you next time

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