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SBA Loans sole proprietorship

If I’ve kept up with anything worthwhile in the past four weeks, it’s been how to get in line for a loan or grant that might help during our current economic situation. I’m sharing what I have learned by summarizing the fruition of labor to date.

On or about March 23, 2020, I applied for EIDL using the original procedure in place. They did have a check box for EIDL loan advance however it was obvious the programmers just created an API and tried to integrate the loan application process into the existing system. I’m proud to report, that I hung in there for three hours and completed the application and was sent a confirming e-mail. All good, right?

Wrong, the following week, on or about April 2nd, I tried walking my son and his LLC through the process. This time they bypassed the online forms and created interactive PDFs that were simple to complete. The site had a good portal that allowed him to upload his forms.

Next day, I received an email from SBA that said something like, “Even though you have submitted an application, you need to fill out another. This EIDL application process was even more simple and seems to be the standard that is still in use today. This form asked for a routing and account number for ACH purposes. A good sign. OK, I guess SBA figured it out. Walked my son through the same process.

Big problem for me. In February of 2020, my accountant files a Sub S application for ALTru Solution and I was given an EIN#. Because I was enamored with my new EIN status, I listed it on my EIDL application however my 2019 taxes were filed using form C and my social security number. We haven’t filed any payroll for 2020 because basically we only had January revenue in 2020 and the picture wasn’t clear before COVID-19 and now the picture is clear as mud!

Ok, without clear guidance for fools or new 2020 entities, I did the American thing and filled out a second EIDL application using my social and data straight off my 2019 return. No clue what will happen there but I’m guessing the US federal prosecutors will allow my “absence of malice” plea for completing two applications. This really came into play after March 27th, and Payroll Protection Program.

Suddenly the American banking system was in play and banks were going to dispense the first round of stimulus. Ok, this process opened on April 3, 2020. Our business bank, a local hometown bank, didn’t have any procedures in place. My personal bank, a large regional institution did. With my personal username and password, I completed the application, but it only had provision for PPP and customers with an EIN. Got one! Completed the application which asked for uploads of my 2019 IRS Form 940, IRS Form 941, Payroll Summary Report 2019 with corresponding bank statements, W2 Summary, 1099 Summary, Payroll Benefits.

I don’t have any of that because I’m a new 2020 entity. Application was rejected, asking for this documentation. A deeper dive revealed that sole proprietorship, contractors, Form C filers would be eligible to submit applications on April 10th, 2020. The date of this blog.

Guess, what? My local hometown business bank listed an application process for the April 10th submission but clearly stated that they have no clue how it’s going to work. I did receive the applications. One was the standard SBA application, same as I filled out through the standard EIDL process. The others were a personal finance spreadsheet and business debt schedule.

I’m happy to report that I did acquire, through my accountant, an email address for a local Vice President. I emailed her and she replied! She basically repeated what the web site said. For now, complete the attached and we will begin accepting PPP applications for sole proprietor ships, contractors, and form C filers on April 10th. Oh yea, we still don’t know what to do with them.

I’m stuck with the agonizing thought that although I could be line after today, I’m last in line. Ok God, I’ll leave this up to you and maybe there are others who need more than I. With the nature of my business, I entered the “less is more” sphere two years ago.

To summarize:

1. Go to and fill out the standard EIBDL application - Use your 2019 or 2018 tax return to calculate payroll. Real simple, go to line #31 of form C, divide Net Profit by 12 then multiply by 2.5. This is the amount eligible. The street seems to think $10k is a grant and the remainder is a low interest loan.

2. Go to your business bank website. Most now have a process in place for PPP loans although they may or may not have a process in place for sole proprietorship, contractors, and form C filers. Obtain your bank’s forms and complete accurately. Hopefully sometime today or next week a standard operating procedure will be place to take these application. Locally, these two banks have this website up.

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