Hi Studio Owners, I’m Donna Bordeaux with PYOPAccounting.com. Are you taxed as a sole proprietor filing a Schedule C? New rules have come about with the PPP Program that may allow you to get a higher amount or get an amount if you weren’t eligible before.
In our prior rulings, you had to use the bottom line number on your Schedule C, which constituted your net profit. So that is all the receipts minus all the expenses. You’ve deducted a lot of things that have major income go down and may have hurt you in the PPP qualification process.
The new rules allow any sole proprietor filing Schedule C to use gross income, line seven of your Schedule C. This will be the amount of receipts that you collect initially before expenses. Now, if you have employees, you will deduct the wages that you pay them as well as any employee benefits or pension contributions made on their behalf.
But you’ll be able to use that number to calculate your PPP. So it does not have to include all of your other expenditures. This does max out at $100,000, so if you max that out at $100,000 and you get two and a half months of PPP, that would be $20,833. For many sole proprietors, this is a huge change over where they were before especially if you were showing a loss in the past, you couldn’t even get the PPP Loan. Now you may be eligible.
So make sure that your revenue numbers are still in the decline, which is pretty easy for most studios to show. You’ll be able to apply the new application should be coming out the week of March the eighth. I’m Donna Bordeaux with PYOPAccounting.com. If there’s anything we can do to help, please just click on the let’s chat and we’ll schedule a time to meet. Thank you.
Donna Bordeaux, CPA with PYOPAccounting.com
Creativity and CPAs don’t generally go together. Most people think of CPAs as nerdy accountants who can’t talk with people. Well, it’s time to break that stereotype. Lively, friendly, and knowledgeable can be a part of your relationship with your CPA as demonstrated by Donna and Chad Bordeaux. They have over 50 years of combined experience as entrepreneurial CPAs. They’ve owned businesses and helped business owners exceed their wildest dreams. They have been able to help businesses earn many times more profit than the average business in the same industry and are passionate about helping industries that help families build great memories.