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Three questions on the Payroll Protection Program application....

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  • Three questions on the Payroll Protection Program application....

    1) We have a 5 doctor P.C. with 16 employees other than ourselves. The physicians are paid a salary plus bonuses. Are the doctor salaries counted in the application?
    2) We pay health insurance on the physicians but not the regular employees. Are we allowed to lump this in with the application of expenses for the SBL?
    3) On of my partners thinks we should decrease our salaries(the doctor's) as we work on productivity and likely at current rate will not be able to sustain this level. Seems to me at least for the next 2-3 months should not decrease our salaries as the may affect the amount of forgive PPP loan?

    Thanks in advance

  • #2
    1) comp counted up to 100k annualized. So yes, capped at 100k
    2) likely health insurance for docs counts as comp, so it doesn't matter - see above
    3) I don't know. Probably don't decrease doc payroll to less than 100k per, annualized but I don't know and I'm not sure anyone knows, what the formula or required documentation will be when it comes time to determine amount of the loan to be forgiven

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    • #3
      1. I agree with jacoavlu
      2. Per this loan calculator health insurance is figured in addition to the 100k salary cap, ie will increase the amount of loan you qualify for: https://www.cainwatters.com/calculat...sba-calculator. Money spent on retirement benefits and contract labor is also figured in apart from the 100k cap. I finally was able to talk to my bank today though, and it sounds like the rules are changing every day.
      3. What I am planning on doing is pay myself at a 100K/year level during the 2 month loan period. Your group would have to decide what is right for it.

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      • #4
        Originally posted by Rando View Post
        1. I agree with jacoavlu
        2. Per this loan calculator health insurance is figured in addition to the 100k salary cap, ie will increase the amount of loan you qualify for: https://www.cainwatters.com/calculat...sba-calculator. Money spent on retirement benefits and contract labor is also figured in apart from the 100k cap. I finally was able to talk to my bank today though, and it sounds like the rules are changing every day.
        3. What I am planning on doing is pay myself at a 100K/year level during the 2 month loan period. Your group would have to decide what is right for it.
        good pickup on #2 - it is clear this is a work in progress - gov has already changed the application document from the one that was distributed just a few days ago

        hopefully clear guidance comes sooner rather than later

        for instance if health insurance is in addition to a 100k salary cap, is 2% S corp shareholder health insurance (which is included in W2 Box 1 Compensation just like salary) still includable above the cap?

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        • #5
          What changed about the application from the first version? Just wondering what they are tweaking.

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          • #6
            I don't think there were a lot of changes. Just some clarifications mostly.
            • Any W2 wages, self-employment income, or partner income allocation is limited to $100,000 per person. You will need to reduce this excess in the calculations below.
            • Do NOT include any payments below made to independent contractors. They would be subject to their own loan applications.
            Use the calculator here as a starting point if you are challenged with the numbers: https://www.stimuluscalc.com/paychec...an-calculator/
            Emparion: Cash balance plans and defined benefit plans for medical professionals | 480-770-4620

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