Don’t Blow Your Bounty
So you’ve applied for or received your money from the government’s PPP program in order to keep you afloat as a result of the Pandemic. I’ll share a few tips to help you stay out of trouble.
Ronald Reagen is considered one of the greatest communicators of the modern presidency, said, “The nine most terrifying words in the English language are: I’m from the government and I’m here to help.”
Keeping that sentiment in mind here are a few things to consider:
- The PPP program rules might change at any time.
- You are dealing with a bureaucracy that for the most part doesn’t understand the day to day operation of a business.
- Don’t count on the loan to be forgiven, consider it a low interest loan that you’ll pay back. If you plan on repayment by setting aside money to repay and the loan is forgiven, you’ll have new reserves set aside.
- Be fiscally responsible. Receipt of the PPP money does not absolve you from being fiscally/financially diligent and responsible for your company! You still need to make the right/tough decisions to remain profitable, or at least “break-even” for near term.
- You shouldn’t assume full exclusion of the PPP funds from taxable income, and should speak with your CPA on the tax implications for your business.
Nobody knows what the future holds, and how much short/medium/long-term impact this financial crisis might have. As of this writing some are predicting that the economy will take 10 years to rebound to pre-virus levels. I don’t feel it will take that long but am certain of one thing and that the near-term is highly uncertain.