May 27, 2020

RECORDED WEBINAR: PPP Loans – New Guidance and Application Review

Download our recorded webinar to hear from the Anders CARES Act Research and Response Team on how to navigate the new PPP loan forgiveness application and new SBA guidance.

The recorded webinar covers key topics, including:

  • Review of PPP FAQs and New Rules
  • Application Instructions and Tips 
  • Maximizing Loan Forgiveness Based on the Loan Application and SBA Guidance
  • Best Practices for Moving Forward

Complete the form below to download the presentation.

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May 26, 2020

Why Startups and Entrepreneurs Are Set Up to Succeed in a Post COVID-19 World

As states begin to start easing restrictions on stay at home orders, people are continuing to wonder what the new “normal” is going to look like, especially for businesses. While it is clear that every business, regardless of industry, will need to figure out what adjustments they will make going forward, there is good evidence that entrepreneurs and startup companies might be the best equipped to succeed in the post COVID-19 world.

Knowing How to Pivot

As we emerge from the COVID-19 pandemic, most, if not all, businesses are going to have to make some type of pivot. It should not be a surprise that most entrepreneurs and startups are normally the best at adapting to changing environments and opportunities since many of them face these challenges in the initial years of starting their business. In fact, many businesses have already started doing this and have had great success at it. In just the St. Louis region, we have seen startup manufacturers and developers shifting part of their production lines to help mitigate the spread of the virus. They were able to modify their business model and start these new lines in a matter of weeks. They are proving as changes continue to evolve, there is good opportunity that many of these companies will be able to adapt and pivot to these changes.

Leading the Way in Virtual

As people are still hesitant to leave their houses, businesses need to think about having more options in order to run a virtual business. Not only for the safety of their customers, but also for the safety of their employees.  While this may not be the easiest change for many businesses, if they can make this change, they will see great success in their businesses model. Within the startup and entrepreneur enterprise, these virtual businesses were already starting to be created, but with the pandemic, we have seen them expand significantly. Even the organizations that support entrepreneurs have quickly moved to create new ways in order to connect virtually. We have already seen these changes being made by organizations like Venture Café, which has changed their weekly networking meetings into virtual networking meetings. While this may be a different way to connect people, Venture Café has made this pivot in order to meet their goals of the organization and they have made this change successfully.

Creative Fundraising

During the pandemic, there has been a significant decrease in investments into startup businesses as people are understandably becoming more conservative with their money. Not only that, but for those investors who are still willing to invest in new companies cannot decide on what companies to invest in since the majority of businesses pitched their company to investors in person before they received fundraising. While this is a downside for many entrepreneurs, fortunately, many of the programs are finding new ways to connect with their entrepreneurs. For example, Capital Innovators still had their annual Demo Day, but this year they converted the Demo Day to an all-day virtual day where all the companies have pre-recorded their pitches which can be viewed by investors at their convenience. Invest Midwest is another example of an organization going virtual. Both of these prove that the entrepreneur support group has already been working on ways to improve processes and with more time, these programs will become even more robust.

Entrepreneurs and startup businesses have proved that we are all in this together and together we will all get through these unprecedented times. They are already proving that the companies who learn to adapt and can pivot will be the most successful companies emerging from this pandemic.

Learn more about how Anders works with startups, or contact an Anders advisor to discuss how COVID-19 is affecting your business. For additional resources, please visit our COVID-19 Resource Center.

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May 22, 2020

Temporary Location Treatment by State for Work From Home Employees During COVID-19

In response to the stay-at-home orders issued by the states, many states are addressing their treatment of the temporary locations of employees throughout the country when it comes to withholding, as well as nexus.  We’ve prepared a list of those treatments below.

Updated 6/25/20

Alabama – State will not consider temporary changes in an employee’s physical location to impose nexus or alter apportionment of income for any business during the periods of telework requirements of the pandemic.

Arkansas – Under current law, an out of state business that conducts operations in Arkansas related to a declared emergency during a disaster response period is exempt from registering, filing, and remitting state and local taxes, including, without limitation:  unemployment insurance; state and local occupational licensing fees and privilege taxes; state & local income tax; and state & local sales and use tax.  Furthermore, an out of state employee is not required to file or pay Arkansas income tax, subject to income tax withholdings, or any other state & local tax or fee.  However, these businesses and employees may still be subject to any ad valorem taxes.  However, Arkansas has not issued guidance on how this law is applied to the COVID-19 pandemic.

District of Columbia – The District will not try to impose corporation tax or unincorporated business franchise tax nexus due to remote workers (including property being located) temporarily working from home inside the District when no nexus existed before the publicly declared emergency.

Georgia – State will not use the temporary relocation of employees due to COVID-19 pandemic to establish Georgia nexus or for exceeding protections of Public Law 86-272 for the employer.  Income earned by employee temporarily working in Georgia will not be considered Georgia income.  Income earned by nonresident employee that normally works in Georgia are considered Georgia wages and income taxes must continue to be withheld.

Illinois – Illinois issued guidance for employers who employ Illinois residents who work from home during the COVID-19 pandemic.  Illinois requires employers to withhold income tax from employees who perform services in Illinois and perform those services in Illinois for more than 30 days.  Those employers who are not registered for withholding in Illinois will need to get registered.  Illinois will waive penalties and interest for out-of-state employers who fail to withhold solely due to the pandemic, but tax must be paid.  Nevertheless, if a state has a reciprocal agreement with Illinois, the withholding requirements don’t apply.  Those states are Iowa, Kentucky, Michigan, and Wisconsin. 

Indiana – Indiana will not try to impose income tax nexus due to remote workers (including property being located) temporarily working from home inside Indiana when no nexus existed before the publicly declared emergency.  These temporary protections will extend for periods where there is an official work-from-home order by the federal, state or local government or order of a physician due to diagnosis.

Iowa – Iowa will not consider the presence of employee(s) working remotely in Iowa solely due to the COVID-19 pandemic, by itself, to constitute nexus for corporate income tax.  Iowa also will not consider non-sales employees in Iowa due to the pandemic enough to lose the protections of Public Law 86-272.  Iowa has also provided guidance on withholding requirements due to the pandemic.  Individual income tax and withholding requirements have not changed due to the pandemic.  Iowa residents are subject to tax on their entire income, wherever it is earned.  Nonresidents who typically work in Iowa, but are temporarily telecommuting in another state, or nonresidents who typically work outside Iowa but are temporarily telecommuting in Iowa, may need to adjust their Iowa apportionments.

Maine – Revenue Services has determined that personal income tax does not apply to a nonresident’s income earned when conducting trade or business in Maine during a disaster period when the income is earned solely from performing services or conducting business during the COVID-19 disaster period at the request of the state, county, city, political subdivision, or a registered business.  This applies to income earned beginning with the date of the governor’s proclamation of a state of emergency on March 15 and runs for until 30 days after the termination of the state of emergency.

Maryland – Regarding interim workplace modes and employee deployment in light of the current health emergency, the agency will not use these temporary measures to impose business nexus to alter business income sourcing or additional withholding requirements on employers.

Guidance issued on teleworking situations on withholding requirements due to COVID-19.  Compensation paid to a nonresident teleworking in Maryland due to COVID-19 is subject to withholding.  However, Maryland has reciprocal exemption agreement with bordering states of Virginia, District of Columbia, West Virginia, and Pennsylvania.

Massachusetts – Employees working remotely temporarily in Massachusetts due to COVID-19 will not establish corporate excise tax nexus solely based on that fact.

State adopted sourcing rules for income tax withholding from employees who telecommute during the COVID-19 pandemic.  If employee was engaged in performing services in state prior to pandemic, employers must source their income withholding to Massachusetts.  If employee is temporarily working in Massachusetts, state will not require withholding from employer if it must withhold income tax from employee in another state.

Employees working remotely temporarily in Massachusetts due to COVID-19 will not establish sales and use tax nexus solely based on that fact.

Minnesota – State will not seek to impose nexus for any business tax solely because an employee is temporarily working from home in Minnesota due to COVID-19.

Mississippi – Mississippi will not use the changes in temporary work locations due to the pandemic to impose income tax nexus or alter apportionment of income.

Missouri – Though the state has not provided guidance on these issues, the City of St Louis has decided to deny refund requests for the days and weeks employees were required to work from home outside the city due to the COVID-19 pandemic.

Nebraska – State has issued FAQs that addressed employers working from a temporary location in or outside Nebraska.  The state has determined no change in withholding is needed for employees telecommuting during the COVID-19 pandemic.

New Jersey – State will not use the temporary relocation of employees due to COVID-19 pandemic to establish New Jersey nexus for the employer.  Income earned during the temporary period of the COVID-19 pandemic will continue to be sourced as determined by the employer’s jurisdiction.

New York – State has stated it is in no position to waive individual income tax liability for nonresident medical workers when in the state for more than two weeks, per New York law.

North Dakota – If an employee is temporarily telecommuting in North Dakota due to COVID-19, income tax nexus will not be asserted on that basis alone.

Ohio – For Ohio municipal income tax purposes, employees who must report to a temporary worksite during the emergency period due to COVID-19, or 30 days thereafter are considered to be working from their principal place of work.  The state has not specifically addressed if that principal place of work was in another state.

Pennsylvania – State will not seek to impose Corporate Net Income Tax nexus solely on the basis of employees temporarily working from home due to COVID-19.  An employee working from home temporarily due to the COVID-19 pandemic, the department will not consider that a change to the sourcing of the employee’s compensation

  • City of Philadelphia – Business income and receipts tax (“BIRT”), as well as the Net Profits Tax deadline for filing and payments has been extended to July 15, 2020.  City will also temporarily waive the nexus threshold for the BIRT when employee works from home solely due to COVID-19 pandemic.  However, if non-resident employees who were previously working in the city of Philadelphia will be deemed as performed within the city.
    • Nonresident employee is not subject to the Wage Tax when the employer requires him or her to work outside of Philadelphia while COVID-19 causes him or her to work from home.

Rhode Island – State has issued emergency regulations and withholding guidance for employers that have employees working remotely in the state due to the pandemic.  Rhode Island will continue to treat income by nonresidents, temporarily working outside the state solely due to the pandemic, as Rhode Island-source income.  However, the state will not require employers located out of state to withhold Rhode Island income taxes on income for employees who are residents of the state but are temporarily working in Rhode Island solely due to the pandemic.  Unless extended, the emergency rules are in effect for 120 days, barring certain events that may happen, such as:  the state of emergency ending; permanent rules are promulgated; or state enters into an agreement with another state that will govern this withholding requirement.

The state has determined that corporate income tax and sales and use tax nexus will not be established solely due to an employee temporarily working in Rhode Island.  Property temporarily located in the state during the state of emergency for telework purposes will not trigger nexus for income tax or sales and use tax, nor will Public Law 86-272 protection be lost due to the employees performing services in Rhode Island during this time.  Furthermore, employees temporarily working in the state due to the pandemic will not change the Rhode Island apportionment percentages.

South Carolina – The state has offered temporary relief regarding nexus being established solely because an employee temporarily works in South Carolina due to COVID-19.  The state will not use the temporary location as a basis for establishing nexus or altering apportionment of income during the COVID-19 relief period of March 13, 2020 to September 30, 2020.

During the aforementioned relief period, withholding requirements are not affected by an employee temporarily working outside South Carolina due to the pandemic.  In addition, an out-of-state business is not subject to South Carolina’s withholding requirement for employees temporarily working in South Carolina due to the pandemic, if the business is currently withholding income taxes on behalf of the other state.

Texas – Under Texas law, an out of state business is not engaged in business in this state if the entity’s physical presence in this state is solely from the entity’s performance of disaster or emergency related work during a disaster response period.

Vermont – A nonresident temporarily living and working in Vermont is required to pay Vermont taxes on the income earned while living and performing in the state, even if they are in the state due to the COVID-19 pandemic.  If a business has remote workers in Vermont only on a temporary basis, they will not be required to change the employee’s withholding state.

After the lockdown, should your employees want to continue to work remotely, many states will impose nexus, requiring you to file tax returns in those jurisdictions. If you have any questions, our State and Local Tax team is here to help. Contact an Anders advisor to learn more about the COVID-19 extensions or assistance in performing a nexus review to determine where you have a filing responsibility. Visit our COVID-19 Resource Center for more news, tools and insights you need to know in these uncertain times.

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May 20, 2020

Accounts Receivables: Where the Cash is Hiding

While there is much unknown today, one thing is for certain – the need for cash is a top priority.  Business owners and CFOs who pivot now will be best prepared to handle these uncertain times. One place to make changes is in accounts receivables.  

Over the last several years, businesses enjoyed a booming economy, low interest rates and ample cash flow.  When times are good, there is a tendency to get lax about receivables. But now as supply chains are affected and managing cash flow becomes more important, companies typically look to optimize three key strategic aspects of working capital:

  1. Cost-cutting
  2. Inventory management
  3. Delaying the accounts payable process

We suggest account receivables is #4.

Accounts receivables are often the largest line item on a balance sheet and have traditionally been an administrative concern. However, as the fourth key factor of optimizing working capital, accounts receivables offers an untapped opportunity for innovation in making the most of working capital.

Manual cash application and other similar repetitive tasks dominate the work day, leaving little or no  time to spend on strategic value add activities. As economic factors change over time, so does a company’s ability to manage their accounts receivables – but this is where cash could be hiding.

Strategies to Improve Cash Flow Surrounding Receivables

In order to develop strategies to help your cash flow, you need to understand your current state.  Be sure to review these categories and ask yourself these questions. The answers will help you identify what you are doing right in accounts receivables and what changes need and can be made.

Credit Policies and Procedures:

  • Do you have a credit policy, or when was the last time it was reviewed and updated?
  • Do you use information from such sources as industry credit groups, credit bureau reports, financials statements, credit references, and public records to evaluate an applicant’s credit?
  • Do you re-evaluate a customer’s creditworthiness on a regular basis, or at all?
  • Do your procedures clearly outline the terms and conditions of the sale of your products/services?

The ability to extend credit to a customer is not given, it’s earned by the credit worthiness of that particular customer. The credit policy is in place because you are taking a risk when you extend work or product to a client. A credit policy is in place to help mitigate the risk, formalize procedures for determining acceptable risk, and set up procedures for dealing with the credit relationship. The need for good credit management to protect your cash flow and working capital becomes even more critical at a time of uncertainty due to economic factors such as the Coronavirus and political turmoil, and others.

Invoice Presentation

While much of this advice might sound pretty straight forward and easy, many companies struggle to get invoices to customers in a timely manner or worse yet, the invoice has incorrect information that delays customer payments. After all, it’s hard to collect an invoice the customer does not have or is inaccurate or incomplete. See how many of these questions can be answered with “yes.”

  • Are invoices issued within 24 hours of providing service or shipping of merchandise?
  • Are invoices automatically generated by your inventory or other invoicing system?
  • Are invoices accurate, clear and complete?
  • Are invoices sent electronically allowing for quicker receipt?
  • Does your organization allow for payments via ACH, credit cards or other electronic means?
  • If electronic payment options are available, have these options been prearranged you’re your customers, or presented along with the invoice to allow for quick and easy payment?
  • If you assess late fees, is this clearly provided on the invoice?

Use a cloud-based software for invoicing. If not part of your accounting software, make sure the software integrates with your accounting system to eliminate any manual effort. Cloud-based systems allow you to access the information anywhere and are often more secure than other alternatives. Most options provide for different invoice delivery methods and payment options, allowing for improved collections. This software can also help you can more accurately track receivables. You can see the invoices that have been sent, and if they’ve been viewed by the customer; as well as what’s been paid and what invoices remain outstanding.

Cash Application Procedures

An area that causes trouble is when customers pay their bills. Ponder these questions regarding your current procedures.

  • Are your cash application procedures manual or has artificial intelligence been employed for automating cash application across all payment and remittance formats?
  • Are cash receipts being posted daily?
  • Do you allow receipts to be credited against a customer’s account rather than apply receipts to a specific invoice?
  • Do cash receipts go into a suspense account rather than reconciling customer accounts on a timely basis?

As payments come in, it’s essential they be applied both to the right customers and to the specific customer invoices to which they relate. And this needs to be done on a daily basis so you always know which accounts are up-to-date and which are outstanding. Otherwise, it’s impossible to track which customers paid on which invoices – making follow-up on late payments a virtual nightmare. Companies that get this wrong often waste considerable time and resources.

Collections and Deductions Management

As a way to manage your cash flow, you may be employing the strategy of delaying payments to your suppliers. Don’t be surprised if your customers are thinking about doing the same thing to you. That’s why it’s important to improve the rigor of your collection processes. It may be time to review and make changes.

  • What are your collection policies?
  • How often is the aging report updated?
  • How often are receivables reviewed for collections?
  • Does your credit policy provide for specific procedures surrounding collections?
  • What are your procedures for identifying and resolving invoice disputes and short payments?

Get the basics right, such as accurate invoicing. Any errors in your billing process can lead to costly delays in receiving payment. Strengthen processes to make sure your accounts receivable aging reporting is accurate. Make sure you are following the collections process outlined in your credit policy. Also, focus on customer-specific payment performance and identify companies that may be changing their payment practices. You may even want to start contacting your customers with larger accounts before the invoice becomes due to make sure these balances are paid timely.

With companies reeling from the effects of COVID-19, taking an in-depth look at your accounts receivables is a smart and critical step to take. You may find some hidden cash, or at least will know where it is not. Contact an Anders advisor to learn more about benefits of outsourced accounting for your business.

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May 18, 2020

PPP Loan Forgiveness Application and Guidance Released by the SBA and U.S. Treasury

Updated 6/8/20

As Borrowers begin calculating the amount of PPP loan forgiveness that they will be granted, the SBA has released the initial version of the application and instructions that will be necessary to provide Lenders with the appropriate documentation. The SBA has indicated there will be additional guidance forthcoming to assist both Borrowers and Lenders as they navigate the process. There are some notable clarifications and changes that we have highlighted below.

Eligible Payroll Costs

Borrowers are generally eligible for forgiveness for the payroll costs paid and incurred during the Covered Period (or Alternative Payroll Covered Period) (“payroll costs”). Payroll costs are considered paid on the day that paychecks are distributed or the Borrower originates an ACH credit transaction. Payroll costs are considered incurred on the day that the employee’s pay is earned. Payroll costs incurred but not paid during the Borrower’s last pay period of the Covered Period (or Alternative Payroll Covered Period) are eligible for forgiveness if paid on or before the next regular payroll date. Otherwise, payroll costs must be paid during the Covered Period (or Alternative Payroll Covered Period). For each individual employee, the total amount of cash compensation eligible for forgiveness may not exceed an annual salary of $100,000, as prorated for the covered period. Count payroll costs that were both paid and incurred only once.

Eligible Non-Payroll Costs

Nonpayroll costs eligible for forgiveness consist of: (a) covered mortgage obligations: payments of interest (not including any prepayment or payment of principal) on any business mortgage obligation on real or personal property incurred before February 15, 2020 (“business mortgage interest payments”); (b) covered rent obligations: business rent or lease payments pursuant to lease agreements for real or personal property in force before February 15, 2020 (“business rent or lease payments”); and (c) covered utility payments: business payments for a service for the distribution of electricity, gas, water, transportation, telephone, or internet access for which service began before February 15, 2020 (“business utility payments”). An eligible nonpayroll cost must be paid during the Covered Period or incurred during the Covered Period and paid on or before the next regular billing date, even if the billing date is after the Covered Period. Eligible nonpayroll costs cannot exceed 40% of the total forgiveness amount. Count nonpayroll costs that were both paid and incurred only once.

Covered Periods for Payroll (Standard or Alternative)

Due to the recently adopted Paycheck Protection Program Flexibility Act of 2020, the Covered Period (or Alternative Payroll Covered Period) has been expanded from 8 weeks (56 days) to 24 weeks (168 days). If a covered loan was received prior to the enactment of this law, the borrower may elect to keep their original 8-week Covered Period.

The first day of the Covered Period must be the same as the PPP Loan Disbursement Date. For example, if the Borrower received its PPP loan proceeds on Monday, April 20, the first day of the Covered Period is April 20 and the last day of the Covered Period is either Sunday, June 14 or Sunday, October 4.

Alternative Payroll Covered Period

For administrative convenience, Borrowers with a biweekly (or more frequent) payroll schedule may elect to calculate eligible payroll costs beginning on the first day of their first pay period following their PPP Loan Disbursement Date (the “Alternative Payroll Covered Period”). For example, if the Borrower received its PPP loan proceeds on Monday, April 20, and the first day of its first pay period following its PPP loan disbursement is Sunday, April 26, the first day of the Alternative Payroll Covered Period is April 26 and the last day of the Alternative Payroll Covered Period is either Saturday, June 20 or Saturday, October 10, depending on the length of Covered Period they choose. Borrowers who elect to use the Alternative Payroll Covered Period must apply the Alternative Payroll Covered Period wherever there is a reference in this application to “the Covered Period or the Alternative Payroll Covered Period.” However, Borrowers must apply the Covered Period (not the Alternative Payroll Covered Period) wherever there is a reference in this application to “the Covered Period” only.

FTE (Full-Time Equivalent) Standards

The application worksheet will calculate FTE based on 40 hours that will be rounded to a tenth. A simplified method that assigns a 1.0 for employees who work 40 hours or more per week and 0.5 for employees who work fewer hours may be used at the election of the Borrower.

FTE Reduction Exceptions and Safe Harbor

The following are considered to be an exceptions: (1) any positions for which the Borrower made a good-faith, written offer to rehire an employee during the Covered Period or the Alternative Payroll Covered Period which was rejected by the employee; and (2) any employees who during the Covered Period or the Alternative Payroll Covered Period (a) were fired for cause, (b) voluntarily resigned, or (c) voluntarily requested and received a reduction of their hours. Any FTE reductions in these cases do not reduce the Borrower’s loan forgiveness.

A safe harbor under applicable law and regulation exempts certain borrowers from the loan forgiveness reduction based on FTE employee levels. Specifically, the Borrower is exempt from the reduction in loan forgiveness based on FTE employees described above if both of the following conditions are met: (1) the Borrower reduced its FTE employee levels in the period beginning February 15, 2020, and ending April 26, 2020; and (2) the Borrower then restored its FTE employee levels by not later than December 31, 2020 to its FTE employee levels in the Borrower’s pay period that included February 15, 2020.

There was significant attention paid to certifications that were required of the borrowers in the initial application process, we recommend you read page 4 of the SBA forgiveness application in its entirety prior to beginning the forgiveness process.

We expect additional changes and clarification in the days to come. Keep an eye out for a webinar with more answers. Our advisors are closely following COVID-19 relief efforts and will continue to publish insights to keep you informed about potential business impacts and benefits. Learn more about the Paycheck Protection Program or visit our COVID-19 Resource Center for more news, tools and insights you need to know in these uncertain times.

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May 14, 2020

Treasury Released New Safe Harbor and PPP Repayment Extension to May 18

In recent weeks, there have been concerns by several companies that applied and received money from the first round of Paycheck Protection Program (PPP) loans and if the funds were “necessary” for their business.  The Treasury had indicated that PPP borrowers have until May 14, 2020 to return the loan proceeds without penalty if the company decided it is unable to certify in good faith that the PPP loan was necessary and they were also to provide additional guidance on this topic before the May 14, 2020 date.

Yesterday, the Treasury issued this further guidance by updating their frequently asked question #46 (FAQ #46).  FAQ #46 asks, “How will SBA review borrowers’ required good-faith certification concerning the necessity of their loan request?”  The certification will depend on the size of the loan.

For borrowers of less than $2 million the answer to FAQ #46 states, “Any borrower that, together with its affiliates, received PPP loans with an original principal amount of less than $2 million will be deemed to have made the required certification concerning the necessity of the loan request in good faith.”  This provides some certainty for borrowers receiving funds of less than $2 million and loans of under this amount are deemed to be “necessary to support the ongoing operations.”  We conclude that this means recipients of loans less than $2 million do not need to return their loans because of concerns regarding their certification.

For borrowers of more than $2 million the answer to FAQ #46 states, “…borrowers with loans greater than $2 million that do not satisfy this safe harbor may still have an adequate basis for making the required good-faith certification, based on their individual circumstances in light of the language of the certification and SBA guidance.”  Meaning that borrowers will still have to provide an “adequate basis” for their certification.   The Treasury will review these applications to determine if they believe the good faith certification was met. If they determine the loan is not eligible for loan forgiveness, they will inform the lender. If the borrower pays back the loan the “SBA will not pursue administrative enforcement or referrals to other agencies”. Additionally, for the lenders the determination “will not affect SBA’s loan guarantee.”

According to FAQ #46, the borrower will not receive forgiveness and will have to re-pay the loan.  However, the potential exposure to other penalties – such as those for violating the False Claims Act – appears to have been eliminated by this additional guidance.  Additionally, the Treasury issued guidance that extends the date to repay the PPP loan from May 14, 2020 to May 18, 2020.  Previously, the guidance provided that any borrower who applied for a PPP Loan and repays the loan in full by May 14, 2020 will be deemed to SBA to have made required certification the necessity of the loan request in good faith.

With the rapidly changing regulatory environment surrounding the CARES Act and the PPP Loan program, there will likely be additional guidance from the SBA and IRS regarding the program. 

Our advisors are closely following COVID-19 relief efforts and will continue to publish insights to keep you informed about potential business impacts and benefits. Learn more about the Paycheck Protection Program or visit our COVID-19 Resource Center for more news, tools and insights you need to know in these uncertain times.

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May 14, 2020

Anders Launches Redesigned Website with Better User Experience

Anders has launched a newly redesigned website, focused on the user experience. The Anders website maintains the same domain,, but offers an updated design with simplified navigation for visitors.

Lindsay L. Suelmann, Marketing Director, led the redesign, explaining that, “Our main goal with redesigning our site was to better interact with clients and prospects. We were looking for the best way to provide them with the information they need, when and where they need it. Anders has a rich culture of thought leadership and we want to get that in the hands of our audience in order to help them move forward. We are excited for the capabilities of this new site through the use of the latest technology.”

Anders partnered with St. Louis-based agency Integrity Web Consulting on the redesign and Barlow Productions on custom photography. The site offers a variety of upgrades to improve the user experience, including a limited number of pages with expanded scroll depth, allowing visitors to find what they need on one page without visiting multiple pages. Custom photography gives users a look into our culture and the individuals they could work with at Anders.

With weekly blog posts and thought leadership posted on the Anders website, the new site offers an Insights hub where readers can find valuable insights by filtering by desired service, industry or content category for easy navigation.

As the firm continues to strategically expand into non-traditional accounting services to better serve clients, the new website design accounts for this with services segmented into Advisory, Audit and Assurance and Tax.

To help individuals and businesses navigate the CARES Act and other COVID-19 relief initiatives, the new website highlights the firm’s COVID-19 Resource Center. With visits to our site and the COVID-19 Resource Center increased during this time, it’s more important than ever to have a user-friendly design to enable visitors to find the COVID-19 related insights they need quickly and from any page on the site.

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May 13, 2020

More Businesses Could be Eligible to File for Bankruptcy Under CARES Act

Enacted to provide COVID-19 relief to small businesses and individuals, the CARES Act has impacted another important area for small business: bankruptcy. With new changes to eligibility and definitions, more businesses may fall into the new standards.

Bankruptcy Eligibility Threshold Change

Section 1113 of the CARES Act addresses the temporary changes in bankruptcy law.  Most importantly, the CARES Act increases the eligibility threshold of debt for businesses that file under Chapter 11 of the U.S. Bankruptcy Code. The new debt threshold increases nearly $5 million from $2,725,625 to $7.5 million or less debt that is required under Subchapter V of the Small Business Reorganization Act (“SBRA”). Because of the increase, more businesses are able to file for bankruptcy under Chapter 11 under the SBRA.

This increase is only available for one year, then sunsets and resorts back to the previous threshold one year from the date of enactment of the CARES Act. The new threshold applies to cases commenced under Chapter 11 on or after the date of enactment. 

Bankruptcy Definition Changes

The CARES Act modifies the definition of “current monthly income” for debtors for Chapter 7 and 13 bankruptcy. Under this definition, “current monthly income” does not include payments made under federal law relating to the COVID-19 national emergency declared by President Trump. Therefore, the stimulus payments made pursuant to the national emergency are excluded. Stimulus payments are also excluded from the definition of “disposable income” under Chapter 13.

These changes in definition under the CARES Act are applicable to cases filed before or after enactment of the CARES Act. For a debtor whose plan was confirmed prior to the date of enactment, they may have their plan modified upon request if:

  1. The debtor is experiencing or has experienced a material financial hardship due, directly or indirectly, to the COVID-19 pandemic; and
  2. The modifications are approved after notice and a hearing

The plan may be modified to expand a Chapter 13 plan period up to seven years, instead of five, after the first payment under the original plan was due. This modification can be requested for one year from the enactment of the CARES Act.

The longer this pandemic affects our economy, the higher the chance bankruptcies may increase. If you have questions, Anders is here to help. Contact an Anders advisor to learn more about the bankruptcy law changes surrounding the CARES Act. Visit our COVID-19 Resource Center for more news, tools and insights you need to know in these uncertain times.

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May 12, 2020

Outsourcing Accounting Functions Can Help Your Business Pivot and Plan for What Comes Next

During the current crisis your attention has been focused on saving your business and keeping cash flow positive. You’ve had to make some hard decisions, maybe even choosing between laying off employees or to stop paying your rent. Perhaps you’ve had to look at downsizing or eliminating positions, including your accounting staff. But today more than ever, you need real-time financial data to run your business and you can’t afford not to have that information. It could be time to consider outsourcing.

Outsourcing allows organizations to scale resources up and down as needed, without having to worry about personnel costs and the related costs of hiring, training and maintaining your staff. Outsourcing accounting functions to qualified firms allow for managing processes such as accounts payable, payroll and financial statement preparation. It also provides you and your business with the opportunity to leverage the varying expertise of many accountants to yield additional benefits, which is even more critical as we adjust to business in this new environment.

Benefits of Outsourcing

Here are just a few of the reasons the outsourcing option could help your business today and be a solution for the long term.

Cut Costs

Do you automatically think hiring an accounting firm to manage your books will cost more than hiring an internal person? The fact is you’re more likely to save money.  Instead of paying full-time or part-time wages and benefits to an employee – including insurance, payroll taxes, unemployment taxes, paid time-off, etc. – you pay only for the time required from a staff focused solely on your financials. You won’t have to worry about lost productivity from office distractions, staff meetings, and vacations or providing a workspace and equipment needed to do the job in-house. As an example, an analysis of one of Anders current outsourcing clients showed a $110,000 of cost savings by outsourcing vs using inhouse accounting services. The good news is that outsourcing is scalable for most businesses of all sizes. 

Trust an Experienced Team of Advisors

Now is the time you need an experienced team helping you manage and analyze your financial situation. An accounting firm offering outsourced solutions brings experience from a variety of client situations that internal employees may not have. Take for example your Paycheck Protection Program loan. You may have received the loan, but now what? Effective financial management requires a deep understanding of accounting best practices, current laws and regulations, and compliance requirements. By bringing in an outsourced provider, you have access to the right set of knowledge for tasks from payroll and accounts receivables to financial statement analyses and tax planning.

Access the Best Accounting Software and Cloud-based Systems

When stay-at-home orders were announced, were you ready for your accounting staff to work remotely? Did your accounting processes continue without interruption? While many businesses may not be able to justify the price tag of today’s technologies and accounting platforms, outsourcing is a way to gain access to expensive technology infrastructure investments, all while accessing data remotely and in real time. Typically, organizations find lower IT costs and greater system reliability as a result of outsourcing.  You’re essentially purchasing those tools indirectly without having to do the system research, licensing, or funding. This is ideal for those looking to cut costs or have limited means. Cloud-based accounting systems can provide solutions allowing for less paper, easy tracking, and keeping your accounting files organized and backed up for many years should you ever get audited by the IRS. Additional benefits are:

  • Advanced functionality by optimizing automation
  • Ability to view all expenses tracked in real-time for complete accountability
  • Peace of mind that comes with additional security
  • Improved analytics to give a complete picture
  • Results delivered quickly and seamlessly
  • Scalable solutions for any size business

Enhance Security

It is well documented that we all have to be on the lookout for phishing scams and other security threats, which is one more reason to make the move. Think of your current processes that address confidential information and security of data from fire, theft, and hackers.  You may be vulnerable. When you outsource, security for your books and financial records is enhanced. Most outsourced accounting providers work with technology and information technology firms that have rigorous safeguards ensuring access control, confidentiality, and redundant data backup.

Minimize Risk

We find that well-meaning business owners often leave tasks such as bookkeeping until the end of the quarter or, worse yet, the end of year. In this current environment, you have to know what’s going on in your business each month, if not each day. While it’s understandable to want to control costs and manage the function themselves, it’s essential to understand the risk of errors and other issues that can arise from such an approach. When you outsource, you can minimize the risks typically involved with relying on your own knowledge and timing or in-house staff. Outsourcing your accounting back office means having your books closed on a monthly basis, all accounts reconciled, and an accurate set of financial statement prepared. By outsourcing, when you need to analyze your business or produce a set of financials for your banker or investors, the information is readily available.

Outsourcing your accounting function is a smart alternative to drive efficiencies and innovation at any time.  Today, it could be the best alternative to get your business through these most difficult times. Contact an Anders advisor to learn more about benefits of outsourced accounting for your business.

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May 6, 2020

Dave Finklang and Rebekah Tucker Named to St. Louis Small Business Task Force

Anders tax partner Dave M. Finklang, CPA/CGMA, MBA and tax supervisor Rebekah J. Tucker, CPA have been selected to join the St. Louis Small Business Task Force. Founded by Erin Joy, CEO of Black Dress Circle, the Task Force is a new initiative to bring together leaders from varied industries to clearly define and address the short and mid-term challenges presented by the economic downturn triggered by COVID-19. The St. Louis Small Business Task Force, a think-tank for community leaders, will meet weekly to share knowledge, resources, and tools to remain resilient amid the crisis and create a catalyst for other industry stakeholders to take strategic action.

“Our goal is to support and empower St. Louis’s small and mid-sized business owners with the vital information and insight they need to guide their companies forward,” said Erin Joy. “We need to do our part in making sure cross-industry relevant and accurate information is shared continually and consistently. Establishing a multi-disciplinary cohort is a step in the right direction.”

Every Wednesday by close of business, insights from each session will be shared on the Task Force’s website at and be made available to the general public. Insights will be informed by the Task Force’s multi-disciplinary approach, which serves to give members and the community the advantage of getting quickly up-to-speed on a variety of salient topics necessary for business recovery, sustainability, and growth. Armed with the information shared in these sessions, business owners will be informed to make strategic decisions and solve problems.

To receive more information about the St. Louis Small Business Task Force, visit If you are interested in learning more about opportunities to participate as an expert, please email and a member of the Black Dress Circle team will be in touch.

Visit our COVID-19 Resource Center for more news, tools and insights you need to know in these uncertain times.

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