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PPPL Excel Workbook Tune - up Case Studies in ERC and PPP Saturday – February 13, 2021 Kevin Cameron MBA CPA [email protected]
PPPL Excel Workbook Tune-up
Case Studies in ERC and PPP
Saturday – February 13, 2021
Kevin Cameron MBA CPA
“A man is only as good as his tools.” -Emmert Wolf
VERSION 2 HAS BEEN RELEASED (ERC and PPP Round 2)NEW 52+ minute walkthrough video at https://youtu.be/rMsO4oGdK30
$179 from Leimberg Information Services using this link:
https://new.leimbergservices.com/wdev/products.cfm?id=111
Result:
1. Can use 100% of wages paid for 4/1 to
4/17 towards the ERC.
2. Will need to count wages for PPP for
any period between 4/18 and 10/2
(end of 24-week Covered Period) to
attain 100% PPP loan forgiveness.
3. Assume qualified wages paid during the
24-week Covered Period are $400,000.
1. Can use enough wages to get full
forgiveness and then balance for
ERC for any wages paid to 9/30.
Case Study #1
1. Was never partially or
fully shut down.
2. Did have a decline in
gross revenue in Q2
2020 of 60%.
3. Recovered to at least
80% of prior year’s
quarter revenue in Q3.
4. Qualifies for ERC for Q2
and Q3.
5. Obtained PPP loan of
$200,000 on 4/18/20.
Result:
1. Can use 100% of wages paid for 3/18 to
5/4 towards the ERC.
2. Can start counting wages paid for 5/5
onwards towards PPP loan forgiveness.
3. 24-week Covered Period ends on 10/4.
4. Assume qualified wages paid during the
period 5/5 to 10/4 are $300,000.
1. Has enough wages to get full
forgiveness and still use wages from
4/20 to 5/4 towards the ERC.
Case Study #2
1. Was partially shut down
from 3/18 to 5/4.
2. Did not have a 50% or
more decline in gross
revenue in any quarter
in 2020.
3. Obtained PPP loan of
$150,000 on 4/20/20.
Result:
1. Can use 100% of wages paid for 3/13 to
4/23 and for 10/9 to 12/31 towards the
ERC (Bookend Periods before and after
PPP Covered Period).
2. Will need to count wages for PPP for any
period between 4/24 and 10/8 (end of 24-
week Covered Period) to attain 100% PPP
loan forgiveness.
3. Assume qualified wages paid during the
24-week Covered Period are $960,000.
1. Can use enough wages to get full
forgiveness and then balance for ERC
for any other wages paid during the
Covered Period.
Case Study #3
1. Was never partially or
fully shut down.
2. Did have a decline in
gross revenue in Q1,
Q2, Q3 and Q4 2020 of
greater than 50% in
each quarter.
3. Qualifies for ERC for
entire period of 3/13/20
to 12/31/20.
4. Obtained PPP loan of
$400,000 on 4/24/20.
Result:
1. Can use 100% of wages paid for 3/18 to
5/9 towards the ERC.
2. Will need to count wages for PPP for
any period between 5/10 and 10/24
(end of 24-week Covered Period) to
attain 100% PPP loan forgiveness.
3. Assume qualified wages paid during the
24-week Covered Period are $120,000
and does not have enough other
qualified expenses without using all of
the $120,000 for PPP loan forgiveness.
1. Will only be able to use wages in #1
above for ERC.
Case Study #4
1. Was partially or fully
shut down from 3/18 to
5/4.
2. Did have a decline in
gross revenue in Q2
2020 of 60%.
3. Recovered to at least
80% of prior year
quarter revenue in Q3.
4. Qualifies for ERC for
3/18 to 9/30 (from shut
down date end of Q3).5. Obtained PPP loan of
$160,000 on 5/10/20.
Result:
1. Can use 100% of wages paid for 3/18 to
5/3 towards the ERC.
2. Can start counting wages paid for 5/4
onwards towards PPP loan forgiveness.
3. 24-week Covered Period ends on 10/18.
4. Assume qualified wages paid during the
Covered Period are not sufficient to
gain 100% loan forgiveness.
1. Will only be able to use wages in #1
above for ERC.
2. Will have to repay portion of PPP
loan not forgiven.
Case Study #5
1. Was partially or fully
shut down from 3/18 to
9/25.
2. Did not have a 50% or
more decline in gross
revenue in any quarter
in 2020.
3. Obtained PPP loan of
$270,000 on 5/4/20.
Identify:
1. Do you qualify for ERC?
1. What is your specific ERC qualifying
period?
2. What is your PPP Covered Period?
3. Wages that can be used for ERC (up to
$10,000 per employee, cumulatively for
2020).
4. Wages that can be used for PPP
forgiveness (Assuming 24-week Covered
Period - up to $20,833 for owner
employees and $46,154 for non-owner
employees).
Summary & Take Away
Remember:
1. Do not use the same wages for both ERC
and PPP – no double-dipping!
2. You will need to specify which wages are
used for PPP (not sure how this will be done
yet).
3. For the ERC, you lose the applicable
deduction for the Social Security tax and
wages equal to the credit amount.
1. This makes the ERC a little less
“beneficial” tax-wise than the PPP loan
forgiveness.
2. You probably need to figure your ERC
before finalizing your 2020 business tax
return.
Summary & Take Away
PPPL Excel Workbook Tune-up
Case Studies in ERC and PPP
Saturday, February 13, 2021
Kevin Cameron MBA CPA
