You’ve wanted a plan and we have been working feverishly to develop one.  There are details for some of these steps that will have to be fleshed out and dependent upon your circumstances.  The following is a GUIDE and not an answer for every situation. The guideline may be updated at any time as we learn more details. 

Step 1: Apply for SBA EIDL loan.  https://disasterloan.sba.gov/apply-for-disaster-loan/index.html

Step 2: Consider temporarily laying off employees who make less than $55K. 

The CARES Act that passed Friday, 3/27/20, adds $600 in federal funds to the weekly state unemployment benefit for all states that opt in.  We do not yet know if Texas will participate but have no reason to expect otherwise.

Step 3: When appropriate, request an EIDL loan advance. 

• No process for this yet.  We will let you know how/when to do this.
• Amount up to $10K
• Payable within 3 days
• Does not have to be repaid

Step 4: Receive EIDL funds and use as needed.  To the extent possible use the funds for business purposes OTHER than these:

• Wages
• Payroll taxes
• Group health insurance
• Current 401K funding
• Rent
• Utilities
• Interest on previously existing loans

This is a loan.  To the extent this money is used prior to rolling these proceeds into the PPP 7(a) loan (discussed below)—it will not be forgiven.  Terms of loan:

• 3.75% interest
• Up to 30 year term
• No prepayment penalty

Step 5: Apply for PPP 7(a) loan

• No process for this yet
• Apply through bank not SBA
• Funds expected to disburse quickly upon approval, but timeline unclear

Step 6: Roll all or a portion of EIDL funds into PPP loan

• May roll all if desired
• May be more beneficial to limit the amount rolled in.  Analysis being done on this currently.

Step 7: Upon receipt of PPP 7(a) funds, use them on the following items during the 8-week period following receipt:

• Wages (owner comp will need to be limited)
• Payroll taxes
• Group health insurance
• Current 401K funding
• Rent
• Utilities
• Interest on previously existing loans

PPP 7(a) funds applied to the above-listed items in the 8-week period following receipt will be forgiven. 

Any EIDL loan amounts rolled in can also be forgiven if used during the 8 week period on the qualifying items. 

To the extent the funds are not used during the required period on qualifying items, the PPP proceeds remain a loan under the following terms:

• 4% interest
• No payment for 6-12 months
• Then a 10 year term

Step 8: Bring back any employees onto payroll as needed when the practice opens or begins ramping up.  Likely sometime within or simultaneous to Step 7.

Step 9: Request forgiveness on PPP loan to the extent eligible.

• No process for this yet
• Keep records for 3 years for possible audit of forgiven portion