Welcome to the Small Business Rundown. Each day, we bring you stories that impact small business owners and their workforce.
Small Business News Highlights for November 2:
- To apply or not to apply for PPP loan forgiveness
- Let’s take this (holiday) party online, say majority of business owners
- Female small business owners face additional hurdles as pandemic continues
PPP loan forgiveness: to apply or not to apply?
“I was on the phone with the vice president of a community bank who tried to argue with me that it’s in the client’s best interest to apply for forgiveness right away. Under no circumstance is that true.”
The Small Business Administration recently streamlined the process for business owners who received Paycheck Protection Program (PPP) loans of $50,000 or less to apply for forgiveness. And while many lenders are encouraging their bowers to apply, some tax experts believe that it might be in the borrowers’ best interest to wait.
For starters, tax experts note that there are many tax-related details to the PPP that have yet to be worked out. As it stands, the portion of the PPP loan that is forgiven is tax free, but SBOs can’t claim tax deductions for the business expenses covered by forgiven loan money. Currently, at least 2 senators are pushing to change this.
Others suggest that it’s worth waiting until after the election and Congress reconvenes to see if additional legislation related to the PPP is passed.
Holiday parties — virtual or cancelled
“The last thing any employer wants is an outbreak due to their year-end party.”
Halloween is barely behind us and naturally, companies are turning their attention to holiday and year-end celebrations.
A recent survey shows that only 23% of companies are planning parties this holiday season. Of those throwing festivities, nearly 3/4 are moving the party online. Over half of the companies surveyed (55%) said that they will not hold a party this year which represents the highest number since 2004.
Female small business owners face additional COVID-related hurdles
“Women are disproportionately owners of foot-traffic based companies.”
As COVID-19 cases increase around the country and state and local governments consider enacting new restrictions, economists have found that female small business owners face a unique set of stressors about the future of their company.
The data shows that women are more likely than men to own businesses that have been hardest hit by the public health crisis. Additionally, women-owned businesses had to lay off more workers during the height of the pandemic and are less likely to have access to capital and resources to stay afloat when cash reserves run out. Female business owners are also more likely to bear the brunt of childcare and schooling, compared to their male counterparts.