Diane talks with Dr. Michael Osterholm, director of the University of Minnesota’s Center for Infectious Disease Research and Policy and member of President-elect Joe Biden’s coronavirus task force, tells Diane why he’s calling for a national lock down.
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Trump predicts coronavirus vaccine will be available to all Americans by April
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The U.S. got some great news with the rehiring of 4.9 million people in June, but the two steps forward the economy took in May and June could be followed by one step back in July. The problem?
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It was … inevitable. As the federal funding bailout was put together, and the SBA Paycheck Protection Program was announced, the scammers came out of the woodwork.
Not now, Satan.
There are essentially two ways in which scammers could try to bilk the system. One is by way of fraudulent applications for federal funding. The other is by targeting small businesses and trying to rip them off.
Let’s take a look at both.
Both CNN and the New York Times warn of a crush of demand, particularly at the start. And it’s no wonder, as there have been nearly 10 million new unemployment claims for the weeks of March 15 – 28. Businesses large and small are shedding workers. Hopefully, a lot of this unemployment will be temporary.
But in the meantime, there are so many businesses in need that the ability of fraudsters to slip their bad actions in amongst the legitimate claims is heightened. That’s not good news. After all, the federal funding is limited. Federal funding isn’t infinite – and just printing up money to meet demand invites catastrophic inflation.
One update has been to raise the interest rate from .5% to 1%. The idea is to make it easier for community banks to participate.
According to the ABA Banking Journal:
“The lender does not need to conduct any verification if the borrower submits documentation supporting its request for loan forgiveness and attests that it has accurately verified the payments for eligible costs…The Administrator will hold harmless any lender that relies on such borrower documents and attestation from a borrower.”
CNN notes:
“In light of the urgent needs, Congress also allowed the SBA to expand eligible lenders who can participate in the program, meaning that banks that typically aren’t included on the SBA’s preferred lender list and don’t have experience administering SBA loans will now be allowed to.”
Is this a recipe for problems? You’d better believe it.
The SBA and federal government – rightfully – want to streamline the process and get cash into the hands of as many small business owners as possible. But unprecedented volume + inexperienced lenders + a ton of cash + scammers smelling easy marks = every opportunity for things to go haywire.
Want to review your options with one of our consultants? Give us a call at 877-600-2487.
In perhaps the unkindest cut of all, there are already situations of scammers trying to prey upon desperate small business owners.
According to the SBA, they do not initiate calls regarding either 7(a) or disaster loans or grants.
“If you are proactively contacted by someone claiming to be from the SBA, suspect fraud.”
It’s best to hear it straight from the SBA about scammers.
And, of course, the SBA also warns small business owners to be on the lookout for phishing schemes, where fraudsters send official-looking email in the hopes that an entrepreneur will reveal important private information. This private information includes passwords, Social Security Numbers, and the like.
Fortunately, there are ways to spot an SBA loan scam.
Inc offers four helpful ways to determine if someone is trying to scam you as you apply for an SBA PPP loan (or any other SBA loan emerging from the COVID-19 situation).
Much like the SBA warns, scammers may try to contact your business and offer help getting loans – or even the loans themselves. That is, so long as you hand over your business credit card number or the like.
According to Inc:
“Scammers could use this information to apply for a loan on your behalf–and you’ll be on the hook for paying it back. Also note, you only get one opportunity to apply for a loan, according to Ami Kassar, founder and CEO of MultiFunding, a small-business loan adviser based in Ambler, Pennsylvania.
If you do receive any notices like this, the Treasury Department recommends contacting the FBI.”
The CARES Act is set up in such a way that there are no closing costs. You won’t have to pay any application or package fees, either. So if someone claims they can get you a loan faster if you just cross their palm with silver – run the other way.
Want to review your options with one of our consultants? Give us a call at 877-600-2487.
The SBA is relaxing a number of its rules. But even though a lender does not have to be a preferred lender, they do need to have applied for preferred lender status. So, as Inc. suggests, try working with your local bank first. That is, a bank with which you already have a relationship.
It will be a lot more difficult for a local bank with a brick and mortar presence to skip town than an online lender you have never heard of before.
But can online lenders participate? At the time of writing of this blog post, not yet. But they’re trying.
Recently, 22 fintech lenders sent a letter asking to be allowed to take part in the Paycheck Protection Program. They wrote to Majority Leader McConnell, Minority Leader Schumer, Speaker Pelosi and Minority Leader McCarthy, saying:
“We seek no gain from this crisis. Our only aim is to protect the millions of small businesses that we are proud to call our customers.”
The signatories to the letter were online lenders we’ve heard of and even reviewed before.
We like Fundbox, and in the interests of full disclosure, we work with them. Check out our most recent review of Fundbox.
Check out our Bluevine Capital Inc. review for how we feel about them. Our Credibly review may help you decide how you feel about this lender – assuming they can get approval from the SBA.
And take a look at our review of Fundera for more information. Take a look at our Funding Circle review for all the details.
Check out our latest Kabbage review for what we think of them. Our Lendio review should be helpful to you. Plus our OnDeck Capital review can help you get acquainted with this online lender.
Biz2Credit is based in New York City. BFS Capital is another New York City-based fintech company. Enova International is based in Chicago. Faire is devoted to working with crafters. FiveStars supports local businesses. FundRocket is based in San Francisco.
GetUpside is an app company working with businesses and consumers. They’re in Washington, DC. Homebase is another San Francisco-based company. They make time management and scheduling software. LendingTree is a marketplace for small business loans, mortgages, and more. They are based in Charlotte.
Middesk provides business analysis. Plaid helps companies with business finance management. SevenRooms provides data-driven operations and marketing for restauranteurs. Signpost works with small businesses on their customer communications, brand reputations, and marketing outreach. Thanx provides CRM software to restaurants.
Veem provides a payment network system. They work internationally, so if your business does international commerce, they can help you get paid by folks in Lithuania who owe your business money. Wisely provides a fully integrated host stand, marketing automation, and guest sentiment software suite for growing restaurant brands. And Womply provides CRM and reputation management software.
Unfortunately, there are a ton of predatory lenders out there. Avoid falling prey to them!
According to Inc.:
“If a company or person is telling you they can get you an SBA loan under the new PPP in a matter of hours, steer clear. Lenders are still waiting on guidance for how to process these loans. The application is expected to be available starting April 3.”
And remember to always verify what you read with information directly from the government or a reputable company. Don’t believe it unless and until you can verify.
Want to review your options with one of our consultants? Give us a call at 877-600-2487.
On April 2, 2020, Speaker of the House Nancy Pelosi announced the formation of a committee to oversee the Trump Administration’s handling of the $2 trillion relief package. And that includes the SBA’s Paycheck Protection Program. This committee is actually concerned with the novel coronavirus itself. Its oversight function exists alongside a function to check the latest science to be sure responses are logical and can save the most lives.
Per CNBC, Speaker Pelosi “said the committee ‘will root out waste, fraud and abuse’ and ‘protect against price-gouging, profiteering and political favoritism.’”
CNBC further notes, “Congress [has] added an inspector general and congressional oversight posts to monitor how Treasury Secretary Steven Mnuchin uses the money. The law also includes limits on stock buybacks, dividends and executive compensation for companies that receive taxpayer bailout money. “
But will this oversight be enough? The jury is still out.
As this situation continues to unfold, we will no doubt see changes. Nuances and details are likely to need updating. So be sure to check out our Paycheck Protection Program information page as we will be updating it with the latest. Once we know it, you will.
We’re all in this together. And we hope you can steer clear of scams and cheats.
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Covid-19 has infected 3.7 million people globally, and killed at least 264,111 as of Thursday morning.
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COVID-19 has infected more than 1,579,600 people around the world as of Thursday, killing at least 94,500 people. The post Coronavirus live updates: Universal Studios extends park closures; US cases top 452,000 appeared first on WE TEACH MONEY LIFE SELF DEFENSE WITH FINANCIAL GOALS IN MIND. The post Coronavirus live updates: Universal Studios extends park … Continue reading Coronavirus live updates: Universal Studios extends park closures; US cases top 452,000
As we near the time most of us dread, when taxes are due, there is a major spin on things this year. The Covid-19 virus has put the world completely on its head, and even the IRS isn’t immune. What does coronavirus mean for taxes, and how can you make sure you keep as much of your money in your pocket as possible? Make sure you take full advantage of all the coronavirus relief options with these 2020 tax tips.
Truly, the coronavirus has affected everything. Currently, the economy is in a constant spiral. There are no signs of letting up any time soon. Before any other 2020 business tax tips, you need to know how Covid-19 affects your tax return this year at the federal level.
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First, both individuals and corporations have an extra 90-days to file and pay their taxes this year. Meaning, instead of having to turn in your tax return and pay by April 15, you have until July 15 to do both without interest or penalties. As of right now, interest and penalties will start to accrue on July 16.
As a result,individuals can defer up to $1 million, including self-employment tax. However, corporations can defer federal income tax payments of up to $10 million. Yet, the government is reminding people and businesses to file as soon as possible in case they are getting a refund. Having the cash-on-hand is more necessary now than ever than ever before.
Remember, this is for federal income taxes. Forty-two states and the District of Columbia have state income tax that currently must still be paid by their original deadline. This could change however, so watch for updates.
Now that you know this, here are our top 2020 Business Tax Tips.
It may be too late for 2019 taxes, but be sure you pay attention to credit card rewards if you use business credit cards. You could owe taxes on those. For this year, look at the rewards you have earned and determine if you need to include them on your tax return. Making sure your taxes are accurate is the best way to avoid a lot of unnecessary time in an audit later on.
Few businesses keep their books with paper and pencil these days. Most use some form of accounting software. Many of these will print out tax forms automatically using the data already in the accounting system. Then, all you have to do is review the forms and supply any supporting documentation.
Be sure you know what your system is capable of and use it. Entering accurate information throughout the year and keeping it up to date will go a long way toward ensuring your tax time goes smoothly.
Here are some great options to consider for next year if you find your software is not what you need.
Zoho is a great option if automation is your jam. They offer a 14-day free trial. The software compiles IRS compliant audit reports making tax filing much easier. Package prices range from $9 to $29 per month.
Arguably, Intuit Quickbooks is the most widely used small business accounting software on the market. The system is comprehensive and affordable for many, making it a great choice. There is a 30-day free trial and packages range from $12 to $75 per month. Payroll add on options are available.
There are many ways to file your tax return. Still, the fastest, easiest, and cheapest way to do so is online. As mentioned, this goes much faster and is a much smoother process if you have the best bookkeeping software for your business.
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Start now scanning backup documentation for next year. Once you are caught up, a few minutes a day can save hours next year. While you are at it, depending on the number of transactions your business does, you could go ahead and scan backup documents for 2019 since you have extra time. It may come in handy in the case of an audit. At the very least, take the extra time to organize all the receipts in your shoebox.
When it comes to 2020 business tax tips, this is the one I would like to stress the most. If you can at all afford it, hire a professional to do your taxes. This is the best way to ensure you keep the most money in your pocket, which is hugely important amidst this coronavirus epidemic.
Looking forward to next year, what can you do to ensure your tax preparation goes as smoothly as possible? There are actually a number of things. They will not help you when it comes to taxes, but they will help you build fundability and business credit as well.
Use an EIN to file your income taxes if you do not already. This is important for a number of reasons, including increasing fundability and helping build business credit. It’s easy and free to get one on the IRS website.
If you are operating as a sole proprietorship or partnership, consider incorporating. Tax wise you can see how functioning as a corporation is going to allow businesses to defer up to $10 million in taxes for 90-days due to the Covid-19 pandemic. There are a number of other benefits as well, including some liability protection. Now more than ever you do not want to be held personally liable for business debts.
You have to open a separate, dedicated business bank account. There are a few reasons for this. First, it will help you keep track of business finances. It will also help you keep them separate from personal finances for tax purposes. Furthermore, it aids in separating your business from yourself for fundability and business credit building.
Beyond taxes, there are several types of funding you cannot get without a business bank account. Many lenders and credit cards want to see one with a minimum average balance. In addition, you cannot get a merchant account without a business account at a bank. That means, you cannot take credit cards payments. Studies show consumers usually spend more when paying by credit card is an option.
While not technically under the category of 2020 business tax tips, it still bears mentioning. Without fundability your business cannot access the funding it needs to run. How the IRS views your business can have an effect on fundability as well. Your business has to be an entity separate from you as the owner in the eyes of the IRS and lenders. Organizing as a corporation and getting an EIN are major for this. What else helps?
The first step in setting up a foundation of fundability is to ensure your business has its own phone number, fax number, and address. You do not have to get a separate phone line, or even a separate location. In fact, you can still run your business from your home or on your computer. You do not even have to have a fax machine. Be certain to use this separate business contact information on your business tax return.
The main distributors of business credit reports are Dun & Bradstreet, Experian, Equifax, and FICO SBSS. Honestly, you have no way of knowing which one a lender will choose. Consequently, you need to make sure all of these reports are up to date and accurate. This is just as important in hard economic times as any other time.
If you have business credit, keep an eye on it right now. Times are tough, and monitoring your business credit is essential to staying on top of any problems that may pop up so you can adjust and correct.
In addition to the business credit reporting agencies that directly calculate and issue credit reports, there are other business data agencies that affect those reports indirectly. Two examples of this are LexisNexis and The Small Business Finance Exchange. These two agencies gather data from different sources, including public records. This means they could even have access to information relating to automobile accidents and liens. While you may not be able to access or change the data these agencies have on your business, you can ensure that any new information they receive is positive. Enough positive information can help distract attention from negative information.
Dun & Bradstreet is the largest and most commonly used business credit reporting agency. Every credit file in their database has a D-U-N-S number. To get a D-U-N-S number, you have to apply for one through the D&B website. You have to have this number to have a file with D&B, and you have to have a file with D&B to build business credit.
On the surface, it seems obvious that all of your business information should be the same across the board. However, when you start changing things up, like adding a business phone number and address or incorporating, you may find that some things slip through the cracks.
This is a problem because of those fraud concerns lenders have. When business information doesn’t match up, it sets off alarms. Maybe your business licenses have your personal address but now you have a business address. You have to change it. Perhaps some of your credit accounts have a slightly different name or a different phone number listed than what is on your loan application. Do your insurances all have the same information?
There are several other agencies that hold information related to your personal finances that you need to know about. For example, many business owners do not realize that their ChexSystems report can affect fundability. Basically, this details any bad check activity. It makes a difference when it comes to your bank score. In fact, if you have too many bad checks, you will not be able to open a bank account. That will seriously affect fundability.
Keep in mind, everything can come back to bite you. Have you ever been convicted of a crime? Do you have a bankruptcy or short sell on your record? How about liens or UCC filings? All of this can and will affect the fundability of your business.
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Your personal credit score from Experian, Equifax, and Transunion all matter. You have to have your personal credit in order because it will definitely affect the fundability of your business. If it isn’t great right now, get to work on it. Don’t forget, the number one way to get a strong personal credit score or improve a weak one is to make payments on time, consistently.
Also, make sure you monitor your personal credit regularly to ensure mistakes are corrected and that there are no fraudulent accounts being reported.
For now, the best of the 2020 business tax tips is to take advantage of the extra time you have to dig through and find every advantage you can. First, if you can at all afford a professional, it’s worth it. They know what they are looking for and are the best at reducing what you pay in and increasing what you get back.
Next, If that is just simply not possible, take advantage of everything your software has to offer. Make sure you are fully aware of all that it can do, and that all the information entered is accurate and complete. This will help ensure your tax bill is reduced as much as possible, but also that in the case of an audit, you are prepared.
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