Young and Company CPAs, LLP | Accounting Firm, Tax Planning & Preparation, Bookkeeping & Financial Management | Rochester, New York | 585-427-0210


Dear Clients and Friends:

During these difficult times I hope you and your family are safe and healthy.  

In addition to your physical health, if you are a small business owner, inevitably the health of your business and the economic welfare of you and your employees quickly comes to mind as well.  

Please know we’re here for you and we will do all we can to assist you through the maze of the government programs to keep your business intact not only to survive during these difficult times but to also thrive.  

The extraordinary $2T Coronavirus Aid, Relief, and Economic Security (CARES) Act relief package, in addition to earlier legislation, has provided a number of programs to assist small businesses. There has been $350 billion to help businesses keep workers employed amid the pandemic and economic crisis

We’ve provided some basic information regarding some of the more important relief programs. Please be aware that these programs are changing all of the time and this information is preliminary at the moment and should not be considered advice. These are new programs with many details that are open to interpretation. We’re not recommending any specific option as each business has different needs and considerations. It’s your choice to decide what’s the best option for your situation. Additional information will be available as time goes on. We will continue to provide additional useful information and links to resources.

Obtaining a Paycheck Protection Program (PPP) Loan from SBA and related Loan Forgiveness:

This is the centerpiece of the business relief programs.

  • Who may qualify: All businesses and non-profits that have fewer than 500 employees may apply.
  • Amount of the loan: The loan amount is 2.5 times the average monthly payroll for 2019. (Special rules apply for seasonal businesses, and new businesses). Payroll includes wages, salaries, commissions, sick and vacation pay, health insurance costs and retirement benefits paid.
  • Loan Forgiveness: For the first eight weeks after you obtain the loan, proceeds used to pay payroll expenses incurred may be forgiven, if you keep the same number of full time equivalent employees and your wages don’t drop significantly from pre-pandemic employment. Beyond payroll costs, there may be a small amount of the loan that can be forgiven for being used to cover rent/mortgage interest and utilities.
  • Ability to Re-Hire: Applicants can re-hire employees they furloughed by 4/26/20 and still potentially qualify for full forgiveness of the loan.

This loan application is made through authorized SBA lending institutions. These institutions will begin accepting applications for the Paycheck Protection Program on the following dates:

  • April 3, 2020 for small businesses and sole proprietorships
  • April 10, 2020 for independent contractors and self-employed individuals

You should contact your current bank to see if they can accept the application.

To help prepare for the application, we recommend that business owners begin to gather the following information and documents:

  • 2019 IRS Quarterly 940, 941 or 944 payroll tax reports
  • Last 12 months of Payroll Reports beginning with your last payroll date and going backwards 12 months (e.g. gross wages for each employee, paid time off for each employee, vacation pay for each employee)
  • 1099s for 2019 for independent contractors that would otherwise be an employee of your business
  • Documentation showing total of all health insurance premiums paid by the Company Owner under a group health plan
  • Document the sum of all retirement plan funding that was paid by the Company Owner (do not include funding that came from the employee’s out of their paycheck deferrals)


SBA’s Economic Injury Disaster Loan (EIDL) and related grant:

Many businesses and sole proprietors in operation on 1/31/20 are eligible to apply for an EIDL of up to $2M. You should only consider applying for this SBA loan if your business has been negatively impacted by an inability to operate or loss of employees due to the effects from COVID-19.  If you are a qualified business you may receive a grant that does not have to be repaid to help cover unexpected costs related to COVID-19.  The Initial Application has been streamlined to provide an initial grant within 3 days, directly deposited to the business’ account. It’s the SBA who will decide the amount of the grant; it could be much smaller than the $10,000 maximum.  The EIDL program is intended only for those who have been negatively impacted by COVID-19.

YOU MUST CHECK THE BOX above the signature area on the application that you want the $10,000 advance.  Otherwise, it may take much longer to get any money or response.

The new SBA form for applying for the EIDL loan advance replaces all other previous forms (the Form 5 and 5C) for applying for the EIDL loan for any entity, sole proprietor or otherwise.If you already filed a Form 5 or 5C, you still need to file the new form for the loan advance.

This loan is applied for directly with the SBA. The streamlined SBA EIDL loan advance application has been posted at:

If you choose to use the EIDL loan we recommend this be filed ASAP. The total amount available will be offered on a first come, first served basis.

Beyond that, an EIDL loan can be used to help cover necessary operating expenses if your business has been partly or entirely shut down.  You must attest to the truthfulness of your answers by certifying UNDER PENALTY OF PURGERY that your information is true and correct.To continue the application process, you must provide detailed financial information about your business and the owners of the company.   The loan needs to be carefully coordinated with any Payroll Protection Plan Loans you may obtain in the future.

Even if you are denied an EIDL loan, you are allowed to keep the grant.

How do I obtain this benefit: Visit, or contact Deb Tregea, EA, our Director of Business Operations professional for more information.  She can be reached at (585) 427-0210 ext. 114 office and (585) 747-5717 cell or via email at [email protected]

Loan Comparison

Covered period Based on State Disaster Declaration. 02/15/20 – 06/30/20
Loan Amount average total Loan based on credit and collateral 2.5 times the
12 Up to $2 Million monthly payroll costs
Months prior to loan origination not to exceed $10 million. (non-seasonal employers.)
Interest Rate Max 3.75% Fixed rate of .5%
Loan duration Maximum of 30 years 2 years
Grants/Forgiveness Advance (grant) of up to $10k available to maintain payroll or other debts Forgiveness available
Collateral required Yes, must provide or pledge collateral for loans over $25k No collateral required
Personal guarantee Yes, requires personal guarantee financial statements required statements to be submitted No personal
Payment deferral Can be negotiated with SBA during No less than 6 months and
application process up to 1 year including principal, interest, & fees.
How to apply banks Direct through the SBA Through approved
Denied SBA loan Previously? If yes, loan may not be a good option. More lenient
Business size employees 500 or fewer employees 500 or fewer


Other State and Local grants and loans:

Check with your state, county and municipal governments and economic development entities for more potential loans and grants.  We will post information on these on our Young & Company CPAs LLP webpage as they become available.


Paid Sick Leave and Paid Family Medical Leave Payroll Credits:

Effective April 1st employers with less than 500 employees must provide paid sick leave and certain medical leave related to the Corona virus.  Certain medical employers are exempted from the requirement, as are a few employers under 50 employees.


If an employee is unable to work or telework because the employee is:

  • Subject to a quarantine or isolation order
  • Has been advised by a health care provider to self-quarantine due to coronavirus concerns, or
  • Is experiencing symptoms of coronavirus and seeking a medical diagnosis

Then, the employer will pay 100% of the employee’s usual pay up to $511/day for up to 10 work days (80 hours for full time employees)

If an employee is unable to work or telework because the employee is:

  • Caring for an individual subject to a quarantine or isolation order as advised by a medical professional
  • Is experiencing certain other similar circumstances to be determined by the Secretary of Labor and the Treasury.

Then the employer will pay 2/3 of the employee’s usual pay up to $200/day for up to 10 work days.

If an employee is unable to work or telework because the employee is:

  • Caring for a child under age 18 if their school or day care has been closed or is unavailable due to coronavirus,

Then the employer will pay 2/3 of the employee’s usual pay up to $200/day for up to 120 work days (12 weeks)

The employer will receive a 100% payroll credit for paying the above wages

as well as the costs to keep their employee on their health insurance during these periods.  The credit will reduce the payroll taxes they must deposit and if the costs exceed their payroll, will result in a refund after each quarter.  Thus these wages will be paid for by the government.

How do I obtain this benefit: Your payroll company will provide a means to code sick/family medical leave wages and will reduce your payroll taxes accordingly and file for any refunds for each quarter.


Deferral of Employer Payroll Taxes:

This provision applies to ALL employers unless they utilize the Paycheck Protection Plan loans (see above).

For wages paid between 3/12/20 – 12/31/20, employers are allowed to stop depositing their share of Social Security taxes.  (Taxes withheld from employees and employer’s Medicare taxes still must be paid timely).

Instead 50% of the deferred taxes are due 12/31/21 and the other half are due 12/31/22 with no penalties or interest.

How do I obtain this benefit: Notify your payroll company that you want to defer your payroll taxes.  Keep in mind this will become a longer term liability.  If you apply for the PPP loan you must pay back the deferral of taxes.


Other Options for helping employees/self-employed:

Expanded Unemployment for Employees and the Self-Employed

For some businesses, the most practical choice is to lay off most or all workers.  Under the CARES Act, unemployment was expanded in several important ways.

  • Employees with COVID related layoffs, will not have a waiting week before being eligible for benefits.
  • All recipients will receive an additional $600 per week in their check over and above their usual state benefits between April and July
  • For the most part, employers will not have their unemployment rates increased because they laid people off due to Coronavirus
  • The self-employed, including the business owner themselves can collect unemployment beginning in April if they are not working, even if they were not covered by unemployment.


Utilizing the Employee Retention Credit:

In any payroll quarter that your gross receipts have dropped more than 50% versus the prior year, you are allowed a 50% credit for wages paid to employees (up to a total credit of $5,000 for each employee in total during the year).  If you have less than 100 employees, this can be payments for workers that are still working or that are laid off.  For employers with more than 100 employees this only applies if you are paying them when they are not working.  Health care costs can also count for this, so employers that voluntarily continue to pay workers’ health coverage while they are off from work would qualify for this credit.  Wages paid between 3/12/20 and 12/31/20 are eligible.

However, if an employer obtains a Paycheck Protection Program Loan, they are not eligible for this credit.

How do I obtain the benefit:  Let your payroll company know if your gross sales will drop by more than 50% versus the prior year in a particular quarter, and they will calculate and provide the credit on your payroll return.

We have an internal task force that is working on COVID-19 related issues for small businesses.  It’s your responsibility to correctly complete the needed applications. We are ready to answer any questions for you and your business to weather this financial storm.  We will stand by you and work with you.  We’re in this together and we will get through this together.

Winston Churchill said “Success is not final, failure is not fatal, and it’s the courage to continue that counts”   We’re in a new world now and it’s going to take much courage and perseverance to move forward.   Let’s move forward together.

The information provided in this communication does not, and is not intended to, constitute legal, financial, and/or tax advice; instead, all information and content, are for general informational purposes only.



David G. Young, CPA