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Special Note: Coronavirus (COVID-19) Impact

Last Updated: 08 October 2020


HHS Provider Relief Fund Update-Phase 3
On October 1st, HHS announced that it will be providing $20 billion in additional distributions to the Provider Relief Fund. Even if you previously received relief funds, you may be eligible for more under Phase 3. See the announcement here.
For information about eligibility and the application process, visit the Provider Relief Fund page by going here. You can also register for the webcast on October 15th by going here.
As always, be sure to READ THE TERMS AND CONDITIONS. In early 2021, you will be required to report the use of funds. Here is the Summary Reporting Requirement for Recipients of the Provider Relief Fund (PRF).
The portal for Phase 3 opened on October 5th and will close on November 6th. You can apply by going here.
View the sample application so you know what questions will be asked and what information you will need to provide when applying.
For frequently asked questions, visit here.
We will advise when more information becomes available to us.


Families First Coronavirus Response Act (FFCRA) Update: Tax Credits May be Available
Congress passed the Families First Coronavirus Response Act (FFCRA) and it became law on April 1, 2020. This law required small employers—less than 50 employees—to issue payroll (subject to limits) for staff who were unable to work due to COVID-19 related circumstances—defined below. Furthermore, the Act offered a tax credit to reimburse the cost of payroll issued for qualifying COVID-19 reasons. 
At that time, numerous legal authorities concluded that businesses providing healthcare services could be exempt from the rules requiring payment of payroll to certain employees who were impacted by COVID-19 and who were unable to work. The Act also exempted employers with under 50 employees if providing paid leave would jeopardize the viability of the business.
Most importantly, right before this law went into effect, the CARES act was passed which enabled a lot of you to receive funds from the Paycheck Protection Program (PPP). If your business relied on the PPP to sustain payroll, those payroll expenses were ineligible to consider when applying for the FFCRA tax credit benefits. 
The incompatibility of the two programs’ and the belief that healthcare businesses were exempt from the FFCRA meant that its benefits were largely disregarded by our medical and dental practices. 
Further clarification came out on September 11th from the Department of Labor narrowing the definition of a healthcare provider. Instead of applying broadly to employees working in healthcare, it was ruled that it be focused on the specific employee role. If you want, you can see the DOL News Release on Revised Regulations.
Given that many businesses fully utilized their PPP amounts, they may also be eligible to claim a tax credit for payroll issued to staff due to a qualifying, COVID-19 related absence. 
So, what do you do now?
  • You may be able to claim an exemption from having to comply with the FFCRA if you have fewer than 50 employees AND you can demonstrate that complying with the FFCRA would jeopardize the viability of the business as a going concern. See Question 58 on the Department of Labor’s FAQ here: DOL FAQ #58
  • If you have not already done so, please post this FFCRA employment poster in your break room or somewhere local where employees can see.
  • If you already paid any employees who were unable to work, for the reasons outlined below, and you do not intend to use those expenses as qualifying expenses for PPP, please work with us or your payroll provider to ensure that the qualifying payroll was reported correctly and triggered the issuance of the tax credits. This FFCRA covers payrolls issued by employers through 12/31/2020.
Program Overview
  • Sick Leave Pay
  • Who is an eligible employee?
  • You can reference the Department of Labor’s web tool here to determine if an employee is eligible.
  • Employee must meet one of the 6 criterion below:
  1. Employee is subject to Federal, State, or local quarantine or isolation order related to Covid-19;
  2. Employee has been advised by a health care provider to self-quarantine related to Covid-19;
  3. Employee is experiencing Covid-19 symptoms and is seeking a medical diagnosis;
  4. Employee is caring for an individual subject to an order described in (1) or self-quarantine as described in (2);
  5. Employee is caring for her child whose school or place of care is closed (or child-care provider is unavailable) due to Covid-19 related reasons; or
  6. Employee is experiencing any other substantially similar condition specified by the U.S. Department of Health and Human Services.
  • How much do I need to pay them?
  • If they are taking paid sick leave for the reasons 1-3 above, you must pay the eligible employee at their regular rate of pay, not to exceed $511 per day or $5,110 total over the entire paid sick leave period (up to 80 hours of pay).
  • If they are taking paid sick leave for the reasons 4-6 above, you must pay the eligible employee at 2/3 of their regular rate of pay, not to exceed $200 per day or $2,000 total over the entire paid sick leave period (up to 80 hours of pay).
  • Both scenarios carry a maximum of 10 days of paid sick leave combined.
  • If you pay them more than the allotted amounts, only the allotted amounts are covered by tax credits. The rest would be on you, the employer.
  • Expanded FMLA Pay
  • Who is an eligible employee?
  • The expanded FMLA leave is for employees who have been employed for at least 30 days and is unable to work due to a bona fide need for leave to care for a child whose school or childcare provider is closed or unavailable for reasons related to Covid-19.
  • This type of leave has a maximum of 10 weeks.
  • Reference the Department of Labor’s web tool here to determine if an employee is eligible.
  • How much do I need to pay them?
  • This is different than the normal FMLA. This is paid leave, but not for the 1st 10 days (employee would be paid under the sick provision in the FFCRA for the 1st 10 days and then paid under the expanded FMLA thereafter).
  • This covers up to 10 weeks of leave and pay, after the 1st 2 week waiting period.
  • The employee would be paid at 2/3 of their regular rate of pay, not to exceed $200 per day or $12,000 in the aggregate (over a 12-week period).
  • If you pay them more than the allotted amounts, only the allotted amounts are covered by tax credits. The rest would be on you, the employer.
Again, if you already paid any employees who were unable to work, please let us or your payroll provider know ASAP as there are tax credits potentially available to you. You will need to provide details on which employees were paid for leave, which leave scenario they qualify for, and when this was paid. Depending on the timing of this, you may need to amend the payroll tax returns/records. For all future qualifying payrolls, please code the payrolls to reflect any qualifying amounts paid or notify your payroll provider.
Key Links


Guidance Issued on Deferring Social Security Taxes
The US Treasury Department issued guidance Friday night on President Trump’s executive order to defer certain employees’ Social Security tax withholding from September 1 – December 31. Under the guidance, employers can opt to not withhold Social Security taxes for those making less than $4,000 per biweekly pay period or the equivalent and have them make up for the withholding between January 1 and April 30, 2021. In effect, employees would be doubling up on their Social Security withholding between next January and April.
There remain several issues even after the three-page notice issued Friday night, including:
  1. It remains unclear how the deferred taxes would be tracked, reported, and repaid.
  2. Regardless of how the tracking would work, it is inevitable it would impose a significant administrative burden on employers.
  3. Employees terminating before the deferral is repaid presumably would face repaying all their deferral on their last paycheck, creating a significant burden on their cash flows.
  4. It is unclear how terminating employees whose deferral exceeds their final paycheck would repay the difference.
  5. Because the deferral from September – December must immediately be made up the following January – April, the benefits are short-lived and marginal for most. 
It appears from the guidance and other sources that employers can opt-in or opt-out of the Social Security tax deferral. Given the administrative burden, risks both to employers and employees, and marginal benefit, PBM recommends that employers opt-out of deferring Social Security from employee paychecks.



HHS Stimulus-Medicare General Distribution Payment Portal Reopened

HHS announced this week that if you are a Medicare provider and you missed the June 3rd deadline to submit your March and April 2020 revenue information, or you have not received General Distribution payments totaling 2% of your annual revenue, then you are potentially eligible for relief from the US Department of Health and Human Services (HHS).
A copy of a webcast that was done on August 13th explaining the program can be found by going HERE.
Below is an e-mail communication you may have received. If not, we wanted to make sure you are aware of this:
Dear Valued Provider:
The U.S. Department of Health and Human Services (HHS) is distributing payments in the Phase 2 General Distribution of the Provider Relief Fund as part of ongoing efforts to offer financial relief to providers impacted by coronavirus disease 2019 (COVID-19).
Starting Aug. 10, 2020, HHS will begin accepting applications from providers who received a payment under Phase 1 General Distribution in order to determine if the provider is eligible for an additional payment.
Who is Eligible?
You may be eligible for another payment if your organization received a payment under the General Distribution and:
1.   Missed the June 3 deadline to submit your March and April revenue information; or
2.   Has not received General Distribution payments totaling approximately 2% of your annual revenue.
As part of the application, HHS is collecting tax forms and revenue data in order to determine a payment that is approximately 2% of annual revenue from patient care. If a provider has already received a payment that is approximately 2% of their annual revenue from patient care, they will not receive additional payments. 
You must initiate an application and the Taxpayer Identification Number (TIN) verification process by Friday, Aug. 28, 2020 at 11:59 p.m. ET to be considered for payment.
Application Instructions
The application instructions and sample application form are available at The website also includes a step-by-step application guide and FAQs. Download and review all of these documents to help you complete the process through the Provider Relief Fund Application and Attestation Portal.
The Portal has been updated to streamline and simplify the required application data fields. Even if you previously submitted revenue information, you will need to resubmit your information in the new Portal.
Finally, if you are still in consideration for a Phase 1 General Distribution payment, you must receive either a final payment or communication of ineligibility prior to re-applying in the current Portal.
HHS will be hosting a webcast on Aug. 13, 2020 at 3 p.m. ET for potential applicants to review the application process and to have their questions answered. Register here.
Additional Information
For additional information, please call the Provider Support Line at (866) 569-3522; for TTY, dial 711. Hours of operation are 7 a.m. to 10 p.m. Central Time, Monday through Friday. Service staff members are available to provide real-time technical assistance, as well as service and payment support.
Thank you for all you are doing to support and protect the American people during this difficult time.



PBM’s Take on the Executive Order to Defer Social Security Taxes

President Trump issued a series of executive orders over the weekend, one of which affects the employee portion of Social Security taxes. The order would:
  1. Allow employees whose pay “generally is less than $4,000” per biweekly payroll, calculated on a pretax basis, ($104,000 per year) to defer withholding on their Social Security taxes for up to one year.
  2. Apply to payrolls between September 1 and December 31, 2020.
  3. Not apply to the employer portion of Social Security taxes.
  4. Not apply to Medicare taxes.
It remains unclear how the deferred taxes would be tracked, reported, and repaid; further guidance on this should be coming from the Treasury Department.
The executive order mentions the possibility of forgiving the deferred Social Security taxes. However, all authorities we researched agree that this would require an act of Congress. Both parties are set against any payroll tax cut at this time.
On its face, the order may have court challenges. Even if allowed to stand, some of the potential issues include:
  1. There will be a significant administrative burden placed on employers to track and report the deferral and repayment of social security taxes for each employee who wants to defer.
  2. It is likely Congress will not forgive any tax deferral. In that case, participating employees will have created a liability that reduces future income.
  3. Employees terminating before the deferral is repaid presumably would face repaying all their deferral on their last paycheck, creating a significant burden on their cash flows.
  4. It is unclear how terminating employees whose deferral exceeds their final paycheck would repay the difference.
While businesses may not have a choice in deferring employees’ social security taxes if they are adamant about it, business owners can at least discourage employees from doing so if it comes up. In the meantime, PBM will monitor the situation and advise as developments unfold.



HHS Application for Medicaid, CHIP, and Dentists Extended Again. Now to August 28th.
HHS announced another extension for the Provider Relief Fund for those providers of Medicaid, CHIP, and Dentists. The new deadline to apply for relief is now August 28th. See below for the official announcement.
There is a due date of August 28th for eligible dental providers and August 28th for other healthcare providers to apply for provider relief by going to the Before doing so, YOU MUST READ THE TERMS AND CONDITIONS to see if you qualify for this program. You can find that by going here:
Helpful Links
As always, if you have already received funds from the HHS as a part of the CARES Act, you can ignore the following message. This is mainly intended for dental providers and other healthcare providers that DID NOT receive provider relief from the CARES Act previously.



HHS Application for Medicaid, CHIP, and Dentists Now August 3rd

We sent out an announcement last Friday about the approaching deadline to apply for relief for providers of Medicaid, CHIP, and Dentists. The new deadline to apply for relief is now August 3rd. Below is a copy of our announcement for your reference:
If you have already received funds from the HHS as a part of the CARES Act, you can ignore the following message. This is mainly intended for dental providers and other healthcare providers that DID NOT receive provider relief from the CARES Act previously.
There is a due date of August 3rd (Previously July 24th) for eligible dental providers and August 3rd for other healthcare providers to apply for provider relief by going to the Before doing so, YOU MUST READ THE TERMS AND CONDITIONS to see if you qualify for this program. You can find that by going here:
Helpful Links



Important HHS Announcement for Dentists and Other Healthcare Providers-TIME SENSITIVE

If you have already received funds from the HHS as a part of the CARES Act, you can ignore the following message. This is mainly intended for dental providers and other healthcare providers that DID NOT receive provider relief from the CARES Act previously.
There is a due date of July 24th for eligible dental providers and August 3rd for other healthcare providers to apply for provider relief by going to the Before doing so, YOU MUST READ THE TERMS AND CONDITIONS to see if you qualify for this program. You can find that by going here:
Helpful Links


 HHS Provider Relief Fund Update-Medicaid and CHIP Providers

On Tuesday, HHS announced that they will be providing $15 billion in additional distributions to the Provider Relief Fund to eligible Medicaid and Children’s Health Insurance Program (CHIP) providers. This means that for our clients, such as pediatricians, dentists, obstetricians-gynecologists, behavioral health providers, etc. who are such providers, you might be eligible for some HHS funds. If you previously received HHS stimulus funds, however, you are not eligible for additional relief at this time.
The portal for this opened on June 10, 2020 so be sure to check their website for more details. Here is a link for the announcement:
As always, be sure to READ THE TERMS AND CONDITIONS. They can be found be going to
For more information about eligibility and the application process visit




PPP Legislative Update
Great news! Last night the Senate passed the House version of the latest Paycheck Protection Program legislation and the President is expected to sign it. While it will take a few days for us to digest the full implications, and even longer for the SBA and Treasury Department to issue new guidance, we do know a few things:
  • You can now choose to extend the 8-week period to 24 weeks. This change is to provide flexibility to make it easier to achieve full forgiveness. We await guidance on how this specifically impacts the calculations.
  • You now have until December 31, 2020 to restore workforce hours and pay rates to the pre-pandemic levels to avoid reductions in forgiveness. This deadline was previously June 30, 2020.
  • Two new exceptions are now provided for not restoring workforce hours: (1) inability to find qualified employees, and (2) inability to restore operations to February 15, 2020 levels. We await guidance on how that is documented.
  • The requirement to spend a specified percentage on payroll costs drops from 75% to 60%. However, the 60% is a now cliff, meaning that at 59% nothing is forgiven. Previously, not achieving the specified percentage meant a gradual reduction in forgiveness. Some in Congress have already come out about issuing a technical correction to bring this back to a gradual reduction.
  • The loan now extends to five years at 1% for new loans. If you already signed loan documents, you can still have a five year period at 1% interest, but only if the lender agrees to it.
Based on this new information, our advice is to consider holding off on giving bonuses to staff or having them work extra hours solely for the purpose of achieving loan forgiveness. Over the next few weeks we hope to get more guidance so we can deliver more specific advice.


HHS Provider Relief Fund Update
Important deadline of June 3rd is coming up. Please read the below update on the Medicare CARES Act Provider Relief Fund
As a part of the CARES act, Medicare providers were given a grant to help support healthcare-related expenses and/or lost revenue attributable to COVID-19. This has been done in 2 phases:
Phase 1-General Allocation
  • If eligible, you would have received this money between April 10th-April 24th.
  • The amount you received was proportionate to providers’ share of Medicare fee-for-service reimbursements in 2019.
  • Originally, providers needed to accept the Terms and Conditions for Provider Relief Fund payments or return the money within 45 days of receiving this money. On May 22nd HHS announced another extension to the deadline to accept the Terms and Conditions. Providers now have up to 90 days from the date they received a Provider Relief Fund payment to accept or reject the Terms and Conditions. If you do not accept the Terms and Conditions or return the money, you have been deemed to automatically attest.
Phase 2-General Allocation Based on Lost Revenue
  • You have until June 3rd to opt in to participate in the second round of HHS stimulus. 
  • If didn’t receive money from first round, then you are not eligible for Round 2
  • There is a nice tutorial on what to expect and how to attest. Click HERE for this tutorial.
  • PLEASE READ THE TERMS AND CONDITIONS. These are nearly identical to the Terms and Conditions outlined in the 1st Round. A primary difference is that for Round 2, you must provide information on your lost revenue for March and April 2020.
For more information on the various CARES Act Provider Relief Funds, and to determine if you are eligible, visit the U.S. Department of Health & Human Services at
Other Helpful links:



PPP Loan Forgiveness Update

Last Friday, the Small Business Administration released its standard application for the PPP loan forgiveness which can be found here. We have spent the past several days analyzing the application and instructions to understand both the new answers these bring as well as the new questions they bring.


Must I spend 75% of the loan proceeds on payroll costs?

No. What was once thought of as a “cliff” is no longer the case. You are not required to meet a 75% spending threshold of your total loan proceeds to comply with the loan provisions. There may be some portion of the loan not forgiven as a result, however. Also, your authorized nonpayroll costs cannot exceed 25% of your loan forgiveness; so, your qualified nonpayroll costs may be limited as well.


Was there any clarity on what is defined as mortgage interest?

Yes. This now applies to interest expenses tied to real property and personal property, meaning the building you are in and the equipment that was purchased with a loan. The interest expenses paid during these 8 weeks is now eligible to be included as a nonpayroll cost.


Any updates on what constitutes as a rental expense for the purposes of PPP forgiveness?

Yes. This not only includes the physical space that you are renting, but any equipment rental/lease payments that you make are eligible expenses.


If I have money left over (not forgiven), what does that mean?

The amount not forgiven will become a 2-year loan with a 1% interest rate and a 6-month deferment of loan payments from the date the funds were disbursed to you.


I received money from the EIDL program. Does that change anything for the PPP forgiveness?

Yes. Any amount you received from the EIDL advance will reduce your PPP forgiveness amount dollar for dollar.


Was there any change on when my 8-week period starts?

Yes. The instructions provided an “Alternative Payroll Covered Period” for payroll expenses only. You can choose to count payroll expenses starting with the first day of the first payroll period after receiving the PPP loan. So, if you received the loan on April 22nd, and the first day of the next payroll period is April 26th, you can count payroll expenses starting with April 26th. Furthermore, if the last payroll ends on the last day of the eight-week period, you can still count the payroll expense even if paid a few days later. Simply said, you should be able to get 8 weeks of payroll in, even if your timing is not perfect with your disbursement date.


What counts as related retirement plan expenses?

No more guidance was made available on this. The safest approach is to compute the retirement plan contributions based on the wages paid during the 8-week period and pay it during the 8-week period. We will assist with these calculations.


Once I rehire employees, how much should I be paying them? I heard that I must restore their pay. What does that mean?

If employees’ hourly/salary pay rate was dropped (potentially due to decreased job responsibilities), you must at least restore their pay to their calculated hourly pay pre-Covid 19 by June 30th to avoid a decrease in the forgiveness amount.


When do I need to rehire employees by?

To avoid a reduction in your FTE count, you have until June 30th to bring your FTE count back up to pre-Covid 19 levels.


What is considered an FTE (Full Time Equivalent)?

The instructions define this as 40 hours per week. For an employee working 40 hours or more a week, they are 1.0 FTE. You have an option for how to calculate employees below 40 hours a week. You can either calculate their average weekly hours rounded to the tenth of an hour, or you can assign them as 0.5 FTE. You must choose the same approach for all employees. PBM automatically calculates both ways and uses the best result. Good news is that this will be the same on the baseline period and the covered period, in theory, it shouldn’t matter that much. It could matter if you were paying someone for 40 hours a week in baseline and now you paid them for 30, thinking it would be equivalent.  It isn’t.


My FTE number has dropped because I have employees refusing to come back, or because I terminated an employee, they voluntarily resigned, or voluntarily reduced their hours. Will this affect my forgiveness?

Not necessarily. If an employee is refusing to come back, you must show proof that you extended a job offer to them and they are refusing. Best if you have it in writing, such as an email exchange. You can claim an exemption for this FTE reduction. You will also not be penalized for a reduction in FTE’s if you have terminated an employee for cause, or if the employee voluntarily resigned or voluntarily reduced their hours if this position is not refiled.


If you have employees that are refusing to come back to work, you should file a notice with your state unemployment agency

Illinois-Illinois-Refusal of Work Reporting Form.pdf

Indiana-Indiana-Notice of Work Recall Refusal.pdf


How can get PBM help with all of this?

PBM has pushed out two questionnaires pertaining to the various stimulus programs which many of you have already answered. If you have not done so already, please complete both so we know to dedicate resources to your practice in the coming weeks and months.



Disclaimer: The information contained within this communication represents our best understanding of the rules and regulations as of the time of writing. PBM may make updates to the contents of this communication to incorporate future changes. These resources are not a substitute for the original authoritative guidance. This communication is provided with the understanding that PBM is not engaged in rendering legal services. All such information is provided without warranty of any kind. Readers are encouraged to have any advice herein reviewed by their own legal counsel for suitability to their particular circumstances.



PPP Application for Forgiveness Released by SBA

Last night the Small Business Administration released its standard application for the PPP loan forgiveness which can be found here.  This is great news in that there is one standard application for all available well before most eight-week covered periods end.  We will be spending the next several days reviewing and analyzing the application and instructions to incorporate both the new answers these bring as well as the new questions they bring. 



Re-staffing and Opening to the Public
Many of you have been allowed and encouraged to reopen your business to the public. As you move forward, we want to help you manage the manageable. Rest assured, each of your colleagues confronts the same issues that you do. Competing interpretations of incomplete guidance offered by governments and professional associations compounds the challenges that we all face. Rather than be paralyzed by this, you need to move forward reasonably and prudently to serve your patients, customers, and fellow citizens. In that spirit we offer a few things for your consideration:
Workplace Safety
Please familiarize yourself with the federal/state/local guidelines as they pertain to your business. We offer several links as a starting point for your review:
Rehiring Employees



Tax Return Preparation Update
Now that April is over, here’s an update on where we stand in the tax return preparation process. 
While PBM staff continue to help business clients with obtaining the Payroll Protection Program (PPP) loan from the SBA, more and more staff resources are now being used to help clients with the intricate details of complying and maximizing the loan forgiveness provisions. In addition, we are working on catching up on the accounting that was set aside while helping clients with the PPP and other programs. Still, we anticipate being able to gradually shift our attention throughout May to tax preparation. The due date is July 15, not including extensions.
Our priorities will continue to be:
  1. Ensuring clients meet the tax filing and payment deadlines. Not all states have adopted the Federal deadline of July 15 for the second quarter estimated tax payments.
  2. Helping clients with particularly severe cash flow needs who may have refunds coming.
  3. Preparing partnership and S-corporation tax returns, as they have the K-1’s needed for the preparation of personal income tax returns.
  4. Preparing tax returns on a first-come first-serve basis. To that end, there are many tax returns in progress that had to be set aside as we dealt with this crisis. If yours is in progress, please still be patient as we will continue to have limited resources throughout May.
Thank you for your patience and understanding as we all work towards seeing an end to this crisis!



HHS Stimulus, Round 2 – Time Sensitive
By Friday April 24th, HRSA had distributed $30 billion of Relief Funds to certain healthcare providers, in proportion to providers’ Medicare Fee for Service payments in 2019. There is another $20 billion being distributed, but only to those who received a part of the first $30 billion. So, if you received a share of the first Relief Fund Distribution, you may be eligible for a share of the $20 billion as well.
Round 2 will be done weekly, with each round closing at 11AM CST each Wednesday. The first round starts on April 29. This is not first come first serve, but it makes sense to get the application in early if you qualify.
As part of the distribution of the additional funds, HRSA is asking eligible providers to supply information from IRS tax filings and to supply estimates of lost revenues in March and April of 2020. If you want your share, here's what you need to do:
Go online to the Application Guide at: THIS IS VERY HELPFUL, SO DO NOT SKIP THIS STEP.
If you had previously received money from HHS and have determined you’re eligible to keep it, go to the CARES Act Provider Relief Fund Payment Attestation Portal by going to need to do this within 30 days of when you FIRST received money from HHS. We are now 2 weeks into this for some, so please do so ASAP.
Go to the General Distribution Portal at Have the following information on hand:
  • Taxpayer Identification Number (TIN) that has received prior Provider Relief Fund payments.
  • Exact amount of payment already received.
  • Relief Fund payment transaction numbers/check numbers.
  • A copy of your most recently filed tax return (1120, 1120S, 1065, or Schedule C if a sole proprietor).
Be sure to read the Terms and Conditions for BOTH Provider Relief Fund Distributions:
Finally, here are the General Distribution Portal FAQs:
As more information becomes available, we will be sending further updates. Stay tuned.



PPP Loan - Complying with Loan Provisions 

The Payroll Protection Program and Health Care Enhancement Act was signed into law last Thursday. While we were hoping for Congress to “clean up” parts of the CARES Act that related to the Payroll Protection Program, this new bill focused mainly on new appropriations without giving us more guidance. That leaves us with unanswered questions even though the clock is running on the 8-weeks for many. Our perspective continues to evolve as we grapple with the practical issues facing you. Here are some remaining questions regarding loan provisions and our take:


Must I spend 75% of the loan proceeds on payroll costs? Put differently, how do I balance the business’ uncertain long-term financial needs with the PPP rules governing the use of the funds?

Pundits go both ways on this. A strict reading of the SBA regulations published in the Federal Register would indicate yes, but that wasn’t part of the original CARES Act. We believe that the safest course is to rehire employees with the goal of making the 75% threshold. So, if you received a loan for $100,000, at least $75,000 should be spent on payroll costs during the 8-week post funding period. Payroll costs include wages at a maximum of $15,385 per employee (including owners), group health insurance premiums, and related retirement plan expenses.


What counts as related retirement plan expenses?

While there is no guidance on this, we believe that the “safest” approach is to compute the retirement plan contributions based on the wages paid during the 8-week period. We recommend you fund 2020 with the minimum retirement plan benefit. We will assist with these calculations.


What can I spend the money on?

You should restrict spending the loan proceeds to allowable payroll costs, rent for your space, and utilities such as phone, internet, electric, and gas. Make sure you retain enough money at the end of the eight weeks to show you’re not using the loan proceeds for unauthorized expenses.


If I rehire employees, must the amounts I pay them be consistent over the remainder of the eight weeks, or can I “backload” the pay?

We have found nothing to answer this either way, so guidance from the SBA would be helpful. Bonuses may have to be justified to the bank, such as describing them appropriately as hazard pay. The “safest” way to ensure compliance with the PPP would be to call back employees and  start paying them in order to meet the 75% threshold.


How do I communicate the restoration of payroll to employees?

Our suggestion is that you notify employees that the Paycheck Protection Program requires the business to restore jobs and payroll. Every business will need to develop a plan for rehiring staff and restoring hours based on their expectations for each employee. In some cases, you may choose to delay rehiring certain employees so that the timing of that employee’s return corresponds with the business’ needs.


What if an employee prefers to stay on unemployment?

Remind them that you are subject to the terms of the Payroll Protection Program which require that you rehire employees. It is our understanding that because they would be employed to their previous hours, they would be ineligible for unemployment compensation. It is also our understanding that should the unemployment office discover through the required quarterly reporting that the employee has received unemployment benefits while receiving a paycheck, the unemployment office will see recoupment of the extra benefits paid and may take further action.


Must if rehire employees before they are needed?

If you choose to rehire employees before the business fully re-opens, and based on their normal job description there is nothing for them to do, now is the time to develop your wish list of things for them to accomplish. Match special projects to employee skills. At the very least, consider having them each provide you two ideas a day on how to improve the office, optimize workflow, increase collections, improve the patient experience, etc. This way you may at least get something useful while pulling the team together.


Can I hire my relatives?

There is no guidance on this. However, tax law is replete with provisions that attribute the benefit of related parties to the principal. It is quite possible the pay of a spouse or children will simply be attributed to the owner, putting them over the pay threshold. Relatives who have been employed for a period up to the crisis are almost certainly safe from this, though bonuses may be questioned.


We will continue to give you our take as guidance is provided. We will offer a Q & A on the forgiveness computations, including partial computations, in a future edition. Stay tuned!




I Have Not Received the Taxpayer Stimulus Payment, Now What?

Question 1:  Do I qualify for it?

In the CARES Act congress has authorized for a Stimulus Payment of $1,200 per taxpayer ($2,400 for couples), and $500 per dependent.  This payment is phased out for income $75,000 - $99,000 for Single Filers, and $150,000 - $198,000 for Married Filers.  The stimulus payment is based on your 2018 Form 1040 Income if you have not yet filed a 2019 Form 1040, and 2019 Form 1040 Income if you have filed your 2019 Form 1040. 

QUESTION 2:  What if I did not receive my stimulus payment?

The IRS issued the initial stimulus payments last week based off your 2018 or 2019 Form 1040’s direct deposit information.  If you did not have a refund for direct deposit, and are eligible for a stimulus payment, the IRS will attempt to mail you a check for your refund (however this could take much longer), or you can go to and update your direct deposit information.

Question 3:  What if my income varies above and below the thresholds?

The stimulus payment is actually an advanced credit on your 2020 form 1040 tax filing.  If you don’t qualify now, you can qualify based on your 2020 tax return information.  However, if you get a payment now, but don’t qualify based on your 2020 tax return, you don’t have to pay it back.  Also, if you got a partial payment, you may get more based on your 2020 tax return.

QUESTION 4: Will I get my stimulus payment if I am not required to file a 1040 income tax return:

If you are not required to file a tax return because your income is too low, you can request a payment from the IRS by logging on to the website and clicking on Non-Filers: Enter Payment Info Here.  You’ll be required to fill in your personal information.

QUESTION 5: What if my address changed and I didn’t use direct deposit?

Either log onto the web site and register your direct deposit information by clicking on Get My Payment, or file your 2019 returns ASAP to register your new address.  If you have already filed for 2019, that recourse is unavailable to you.

QUESTION 6: What if my stimulus payment doesn’t include all my dependents?

Go to and enter your dependent information.  Otherwise, you must reconcile the difference on your 2020 Form 1040.

QUESTION 7: When will the checks be sent?

Checks are supposed to be sent out weekly based on the recipient’s adjusted gross income (AGI) the IRS has on file.  For AGI’s less than $10,000: April 24.  AGI’s $10,001 - $20,000: May 1.  AGI’s $20,001 - $30,000: May 8, and so on.  We’re hearing that the IRS may not be holding to this schedule.

QUESTION 8: Should I call the IRS about my payment?

 We do not recommend you try calling the IRS.  They will have you on hold for hours if they answer at all.  For that reason, we will also not be calling the IRS regarding the stimulus payments on behalf of clients.  For more information, go to



You Received the HHS Medicare Relief Funds, Now What?
As you are probably aware, the CARES act also provided for grants to Medicare providers. The amount is about 6.2% of the practice’s 2019 Medicare receipts. Chances are you have already received the money. 
You are now obligated to attest to your eligibility for this payment.   If you don’t complete the attestation, you will still be subject to the obligations imposed.  You must attest by logging into an HHS web site within 30 days of first receiving this money whether you keep the money or not. Non-compliance with the terms are grounds for recoupment, and possibly further action. A few of the notable terms you agree to if you keep the money:
  • You will use the funds only to prevent, prepare for, and respond to Coronavirus, and for health care related expenses or lost revenues related to Coronavirus. This is viewed broadly, and we await additional guidance on this.
  • You will not use the funds to reimburse for expenses or lost revenues that have been reimbursed from other sources. Think Payroll Protection Program.
  • You will submit reports as required by the Secretary of HHS.
  • If you received more than $150,000 in total funds under the CARES Act (this includes the PPP loan the Families First Coronavirus Response Act, or any other act making funds available for the Coronavirus response), you will submit special reporting no later than ten days after the end of each calendar quarter. July 10th appears to be the first reporting deadline.
  • You will maintain appropriate records and documentation to substantiate the reimbursement under this award.
  • For all COVID-19 care, you will only seek to collect from patients as if they were in network, whether they are or not. We await further guidance on this point.
There are restrictions against using these funds for other activities. Here are a few of them:
  • No payment for salaries greater than Executive Level II (197,300 in 2020). We await additional guidance on the application of this limit.
  • No payments for lobbying.
  • No use of the funds for providing abortions or for embryo research.
  • Restrictions on using the funds for confidentiality and nondisclosure agreements.
What to do now:
We are working to locate additional resources to provide credible guidance for you.


You Received the PPP: NOW What?

In the April 15, 2020 edition of the Federal Register (see link below), beginning on page 20811, the SBA outlines the Interim Final Rule regarding the PPP program.  In those 7 pages, the Paycheck Protection Program “PPP” is described, but several questions remain. Our observations are based on our understanding as of this writing.   We will update you at least weekly as our understanding evolves during the coming weeks.
While the interim rule states that 75% of the PPP Proceeds “shall be used for payroll costs” it goes on to state that, “If you use PPP funds for unauthorized purposes” you will need to repay those amounts and could be subject to additional liability. Authorized purposes include:
  • Payroll, including wages (subject to an annualized limit of $100,000/employee) plus health insurance premiums and retirement benefits
  • Qualifying non-payroll expenses are limited to 25% of all qualifying expenditures. Besides payroll costs, qualifying expenditures include:
  • Cost of leasing space subject to a written lease effective before 2/15/2020
  • Utilities including phone, internet, gas, and water
  • Mortgage interest costs
PPP Proceeds not forgiven are considered a 2-year loan with an annual interest rate of 1%; the first monthly payment is deferred for 6 months after the funding date. Additionally, there are a number of tests regarding the levels of employment that you maintain during the 8 week measurement period that will determine how much of the PPP Proceeds may be “forgiven”. 
For now, we advise you to focus on the best long-term use of the money. We don’t know how long your business will be disrupted. You will need money to operate your business beyond the next 8 weeksSo, spending the money now for your staff to do nothing may deprive you of needed funds later that are subject to a very low rate of interest. Here are some practical steps to take when you receive the funds:
  • Hold in cash reserves any PPP proceeds received that exceed the “authorized” expenditures disbursed during the 8 week measurement periodFor example, if you receive $300,000 in PPP proceeds and you spend $225,000 on authorized payroll expenses and $25,000 on rent and utilities, you will want to preserve a bank balance of at least $50,000 as of the end of the 8-week measurement period.
  • Don’t immediately rehire employees who are on unemployment just to maximize loan forgiveness. We believe it is better to wait for more guidance as well as the results of the pending legislation. True, some of the money may have to be repaid, but the money is gone either way. We will comment further shortly after the new legislation is analyzed.
  • Do pay these bills:
  • Rent for your location, but not equipment
  • Utilities (gas, water, electric, phone, and internet)
  • Group Employee health/dental insurance premiums
  • A proportionate amount of Retirement Plan contributions (we will assist with this as well as with the other computations.)
  • Record the deposit into your accounting software separately from all other deposits. In your accounting software create a new income account called “PPP Proceeds”. PBM can assist you with setting this up
An 8-week clock starts on the date you receive the funds. Loan forgiveness depends on payments for qualified costs during those 8-weeks. We are building tools to help in the computations, but there are still unresolved questions that prevent calculating with confidence. Some of the unresolved questions are:
  • Will the start of the 8-week clock be changed in the next legislation?
  • How many hours per week constitutes a full-time equivalent (FTE): 30, 40?
  • What retirement plan costs are deductible?
  • If the loan is forgiven, what about the corresponding expenses? Will those also be deductible?
We will continue to advise on the PPP program at a minimum of once per week for the foreseeable future. Hopefully, new funding is passed by Congress today. If so, there may be more changes to the program. We’ll advise on those as well.


Special Dental Update

As you know, states have extended the “stay at home” order until at least April 30th, 2020.  State dental societies have recommended cessation of in-person dental treatments except for emergencies until at least April 30th as well.  This has made financial decisions very difficult for dental professionals during this uncertain time. Many dentists are now receiving funds from the Paycheck Protection Program (PPP), in which the loans can be fully forgivable if you meet the requirements.  Those requirements are: (1) you need to reach 75% of your prior year comparable payroll, and (2) you have the same number of Full-Time Equivalent Employees (FTE) for the 8-week period following your loan origination date.  These will be difficult requirements to meet if you are facing a prolonged forced shutdown of your practice.

Our previous guidance did not specifically cover the needs of a dental professional, who faces complicated decisions on how to use the PPP funds within the 8-week period. Consider the following items when deciding how to use the funds for the PPP Loan:

  1.  Follow all guidance from the American Dental Association and your State Dental Society on reopening your practice.  Don’t rush to reopen to patients unless you have clear guidance on how to properly do this.
  2. If you are in a shutdown, don’t pay the staff with the PPP funds for not working just to meet the requirements of the loan forgiveness.  It’s not worth it.  It also may be problematic for your staff if they must re-apply for unemployment should the closure remain longer than the 8-week forgiveness period.
  3. Pay yourself at least $8,333 per month, or $4,167 over 4 pay periods, for the 8 weeks after the loan funding date to have this portion of the PPP funds possibly forgivable.  Any amounts higher than that will not qualify for forgiveness.
  4. If you cannot use the PPP funds for staffing cost, try to use at least 25% of the PPP funds for rent, mortgage interest, and utilities which CAN possibly be forgiven.  As per our prior email, PBM can help you track the funds which can be forgiven, and make sure they are not being co-mingled with any other government stimulus payments you may have received.
  5. If you cannot use the PPP funds for staffing and other qualified expenses, understand that a significant portion of the loan will not be forgiven.  It will instead be an unsecured loan with a 1% interest loan for 2 years to cover your expenses during this difficult time.  It’s still a great deal.  But use the funds wisely.  One possible use would be investing in Personal Protective Equipment (PPE) so you can get a jump on opening your practice.




Your trusted PBM Advisor is happy to help with questions related to your specific situation, and we are available for consultation during this troubling time.  Feel free to reach out to discuss your situation with us, and we can best tailor a plan to accommodate your needs and come up with a detailed plan to use the Paycheck Protection Program funds for your practice.



Documentation for the PPP, EIDL and HHS Stimulus

Once you have the “free” money from the government, it is your responsibility to demonstrate that it was used for the intended purposes.  If you don’t, the money will no longer be free.  Worse yet, if you are found to act egregiously with the money, there may be penalties.  Here’s what NOT to do with the money once you receive it:


·        Do not pay yourselves bonuses                 

·        Do not pay down debt in excess of normal debt payments

·        Do not build out your office or buy equipment


In short, over the few months you will be subject to scrutiny by the government, it is best to run the practice as normally as possible without any extra spending.


With this email is a sample (oversimplified) worksheet illustrating how we will account for these programs.  The objective of this worksheet is to demonstrate your compliance with each one.   The worksheet’s green column reflects the entirety of your practice during the sample period.  This will not be shared with the government but will enable us to reconcile all the entries with the totals for the practice to ensure that nothing is missed.  This will mirror your accounting system.    Each of the other columns is a subset of the green column and demonstrates how the funds are used exclusively for their intended purpose. 


The “Document Description” and “Payment Dates” columns refer to specific reports and documents you will be collecting and putting in separate folders for each program – either physical or virtual folders.  If you do this, you will be collecting the information needed for reporting and auditing purposes as you go.  We recommend you not add expense categories to your accounting system as this will complicate your system for years to come and provide little additional benefit over the folders. 


Whether you choose to open separate bank accounts for the money or not, you will need to produce information just like this.  For this reason, we are not recommending you open separate bank accounts for the government money.  Multiple bank accounts bring their own set of complexities. 


We highly recommend you have us assist you in the process.  Our cost can be minimized by having you collect the documents and provide us with the folders.  We will then in turn produce a worksheet like the one enclosed for your practice that ties to your accounting and documentation.  We will also perform the calculations necessary to include the expenditures per government regulations.  Two other areas in which we can help:


·        Documenting and reporting the loss of receipts for your practice

·        Documenting and reporting any coronavirus projects and making sure there is no duplication with the other programs.


As you are no doubt aware, the situation with these programs is highly dynamic with new information coming out daily.  As more information arrives to help you refine which expenses qualify and which ones don’t, we’ll be passing that along in a future communication.



Finally, for our dentist clients, there will be another communication soon regarding your specific circumstances with these programs.




Clients have begun to receive deposits relating to the various government programs.


·       Numerous opinions have been offered about how to track these funds.  Seemingly simple methods, such as separate bank accounts for each source of funding, create unintended complexities.


·       Later today we will be emailing you information about how we intend to help you organize your systems to track deposits and corresponding disbursements for each of the programs. 



  • Virtually all these deposits come with STRINGS ATTACHED.


Our timeline for Constant Contact Emails:





 We will address the specific needs of each client on a case by case basis.




HHS Payments-CARES Act

You may have received a payment today from Medicare in your business checking account coded “HHSPAYMENT”. This payment is attributed to a provision of the CARES Act in which $100 Billion Dollars was allocated to hospitals and other healthcare providers to assist with the coronavirus response. THIS PAYMENT IS A DIFFERENT PROGRAM THAN THE CMS ACCELERATED AND ADVANCED PAYMENT PROGRAM YOU MAY HAVE REQUESTED PREVIOUSLY.
The payment issued today was the initial payment of the $30 Billion of the allocated funds for all facilities and providers that received Medicare fee-for-service reimbursement in 2019. The allocation of the remaining $70 Billion of funds available will be issued on a later date for targeted distributions to areas particularly impacted by the COVID-19 outbreak, rural providers, providers of services with lower shares of Medicare reimbursement or who predominantly serve the Medicaid population, and providers requesting reimbursement for the treatment of uninsured Americans.
Your Medicare distribution is calculated as follows:
Your 2019 Medicare Billing / 484 Billion x $30 Billion = Your Payment Amount.
This payment will not have to be repaid if you attest to the terms and conditions specified by Human Health Services (HHS) within 30 days of receiving the payment. The portal for signing the attestation will be open the week of April 13, 2020. The initial terms and conditions from HHS are specified at 
Some key items specified in the initial terms and conditions from HHS are as follows:
  1. The Recipient certifies that it billed Medicare in 2019; currently provides diagnoses, testing, or care for individuals with possible or actual cases of COVID-19; is not currently terminated from participation in Medicare; is not currently excluded from participation in Medicare, Medicaid, and other Federal health care programs; and does not currently have Medicare billing privileges revoked.
  2. The Recipient certifies that the Payment will only be used to prevent, prepare for, and respond to coronavirus, and shall reimburse the Recipient only for healthcare related expenses or lost revenues that are attributable to coronavirus.
  3. The Recipient certifies that it will not use the Payment to reimburse expenses or losses that have been reimbursed from other sources or that other sources are obligated to reimburse.
  4. The Recipient shall submit reports as the Secretary determines are needed to ensure compliance with conditions that are imposed on this Payment, and such reports shall be in such form, with such content, as specified by the Secretary in future program instructions directed to all Recipients.
We are not clear in the initial terms and conditions if a practice is not actively treating COVID-19 patients, but have suffered lost revenue, or endured expenses due to the coronavirus will you still qualify for the terms and conditions specified by HHS. We hope to have more clarification on this in the coming days, so we encourage you to hold on to funds until we have further clarification on this issue in case these funds need to be repaid to HHS if you do not qualify.
Feel free to consult your PBM Advisor for any questions on this matter.



EIDL and PPP Loan Update
Now that we are just over a week since the simplified EIDL (Economic Injury Disaster Loan) was made available and are just under 1 week since some banks started accepting applications for the PPP Loan (Paycheck Protection Program), we wanted to send out some guidance and some answers to questions as we know them today. There is still a lot of clarification from the SBA that hasn’t been made available yet, so stay tuned to our e-mails and our website.
EIDL Loans
PPP Loan
  • This loan is one that you must apply directly with your bank. Every bank is requesting different items, so this has been tricky to help put together all the information that has been needed; and to boot, the rules have been constantly evolving on this so please keep following our mailings and website for more updates.
  • The banks started accepting applications on April 3rd. Due to the pressure to get this out to the public, this was pushed out without a lot of guidance so many banks struggled to get this ready in time. In fact, several banks still are not ready. Check with your bank about the process to apply and what is needed.
  • For the forgivable portion of your loan this does not have to be repaid, nor is it considered taxable income for Federal purposes.
How the EIDL and PPP Work Together
  • You can have both the EIDL and PPP loans, but they must be used for different purposes:
  • Use the EIDL loan for expenses such as malpractice insurance, professional supplies, vaccines/drug costs, legal/accounting fees, etc.
  • Use the PPP loan for payroll costs, rent, utilities, group health/dental insurance, retirement plan funding.
  • If you find yourself unable to use the EIDL loan for purposes other than what the PPP loan allows, then you will need to refinance your EIDL loan into your PPP loan.
  • There is some confusion about having applied for the EIDL before April 3rd and how this would affect your PPP loan. This only applies to money received from the EIDL before April 3rd, which none of our clients have received this yet.
If you would like more information about both programs, we have provided a few sites that have been helpful:




PBM Operational Update
To conform with current guidance about “social distancing” during the next two weeks, we are making some changes and we want to update you.
  • Beginning tomorrow, April 8, 2020, most PBM staff will be working remotely. Our lines of communication remain open. You will still be able to contact us via email, your web portal, the U.S. Mail, and through our phone system.
  • When you call our office, our system will prompt you to leave a voicemail. We will retrieve and route these to the appropriate staff member throughout the day; at least once each ½ hour.
  • Our U.S. Mail is delivered to a secure post office box within our local post office facility. We will continue to retrieve it each business day.
  • Because we may be unable to sign for Federal Express and UPS deliveries, we recommend that you use the U.S. Mail express delivery services for all expedited or oversized packages.
  • We will continue to provide payroll, tax, accounting, and consulting support services just as we have been during the last several weeks.


  • We do not expect to make physical client visits in April. Instead, we will be scheduling virtual visits using the “Go To Meeting” and our conference calling platforms. We will be giving you direction about these as our vision takes shape.
Another day, and more guidance received. Overnight the U.S. Treasury issued a 6-page document with F.A.Q.’s regarding the Paycheck Protection Program:
Several relevant “takeaways” from our perspective:
• Accurate information is the responsibility of the borrower. The lender must do due diligence to verify the information. If errors in calculation, the lender should remedy the error with the borrower.
• The borrower has to determine all its affiliate entities (over 50% ownership) and do total FTE headcount and notify the lender of this affiliate relationship.
• PPP covers payroll for vacation, medical and sick leave. However, if you get tax credits as a result of paid sick leave or the Expanded FMLA benefits contained in the Families First Coronavirus Response Act (“FFCRA”), these payroll amounts will be excluded from calculations relating to the PPP.
• A single signature on a PPP application for the entire business is OK from the designated “authorized representative” of the business.
• Borrowers can calculate aggregate payroll costs from either the previous 12 months or calendar year 2019. It seems whichever they chose is acceptable.
• Employer Social Security and Medicare taxes (“FICA” taxes) are not included in “Gross Monthly Wages” Calculation. However, if the application has already been submitted it is OK to rely on the guidance available at the time of application to submit a proper application. If the application has not been filed as of yet the application should be revised to exclude EMPLOYER FICA taxes.
• It does imply that we continue to include state unemployment tax with the calculations of “Gross Monthly Payroll”.
Please reach out to your consultant with any questions. Thank you in advance for your patience and understanding as we all are working to get through these times together.


We leave you with a quote by the famous former coach of UCLA basketball John Wooden:
“Things turn out best for the people who make the best of the way things turn out”



What a past few days this has been! The flood gates have opened for the Paycheck Protection Program (PPP) Loan. Many banks were not ready Friday morning, but most should be ready by now. Some banks are still going through their vetting process and will be accepting applications soon. BE SURE TO CHECK YOUR INDIVIDUAL BANKS FOR UPDATES!
The US Treasury announced guidance on what constituted as “payroll costs” late Thursday night. Neither the banks, nor payroll providers digested the changes, nor was the “guidance” clear. This left many banks and payroll providers to interpret this guidance. The American Institute of Certified Public Accountants (AICPA) along with a coalition of payroll processors, took a stance over the weekend trying to provide guidance around the PPP details.
The situation is fluid, and with this program being new, there are still a lot of unanswered questions.
Based on the AICPA’s work with the payroll processors over the weekend, payroll companies like ADP (the largest payroll provider in the U.S.) have made changes to their method for computing average monthly payroll, and we are doing likewise. 
As a result of this change, you may be eligible for a higher PPP advance amount. We are revising our calculations to account for the changed methodology. We will be sending updated figures to our clients for whom we’ve previously run these calculations. If you already filed your SBA loan application, you will need to work with your SBA lender to determine if/how you can submit revised information.
Thank you in advance for your patience and understanding as we all are working to get through these times together.



The Paycheck Protection Program is going to go live, TOMORROW, April 3rd, or so we are told. Time is still unknown at this point, so be sure to check with your bank online. This is bank specific so you need to login to your bank online, as the owner of your business, and apply for this loan. PBM cannot fill out this application for you, but we are here to help however we can. We will doing our best tomorrow to send you the required financial summaries necessary for the program. Each bank is requesting different information as of this writing, and some banks have not disclosed their “request” list for the program; so in those cases you may need to explore their web portal and communicate their request list to us.
What do you need to do?
  1. If you haven’t already done so contact your bank to determine if they are participating in this program.
  2. Find out what information the bank is requesting, because this is different for every bank. PLEASE CONSULT WITH YOUR BANKER WITH WHAT ITEMS THEY ARE REQUESTING.
  3. When completing this application, please be sure to list Professional Business Management, Inc as your contact/consultant/accountant in this process. We hope that this may facilitate our access to the information if necessary. In addition to the work we are doing now, we will be doing more work later down the line to help you gather the necessary documents to make as much of your loan forgivable as possible. Our focus is to see you recover from this and successful in business. 
What can PBM do?
  1. We can help gather information such as tax returns, financial statements, payroll information, etc. The level of detail that we can provide depends on your level of engagement with us.
  2. We cannot fill out the application for you, but we are here to help. Because we will be helping a lot of clients navigate this, give us a call and setup an appointment with us so we can give you our undivided attention. 
We estimate this will take PBM 2-3 hours to pull together the information that will be requested. Please contact your banker to determine what is needed before we start assembling our package of information, so time isn’t wasted.
To request our assistance with this, please respond to this e-mail or e-mail us directly at This email address is being protected from spambots. You need JavaScript enabled to view it.. We will be working in the order in which requests are received. Thank you for your understanding.
Here are some reference materials about the loans available:


Thank you in advance for your patience and understanding as we all are working to get through these times together.



 In our previous letter, we outlined 2 options for obtaining money from the government as a result of the recent acts passed by Congress. Here is what we recommend:


1.     Apply for the Economic Injury Disaster Loan and Loan Advance (EIDL)

a.     Owners of small businesses are eligible to apply for an advance of up to $10,000. We are told that these funds will be directly deposited into your business bank account within 3 days of a successful application, and this loan advance will NOT have to be repaid.

b.     The application process has been streamlined, so it shouldn’t take more than 30 minutes for the initial application.

c.      From there, the SBA will determine what amount of loan you qualify for. We assume you will need to provide more detailed information about your business and your financial needs at a later time.  

d.     Here is what you need to apply for this streamlined process:

                                                    i.     Information about the business:

1.     Gross Receipts from 2/1/19-1/31/20

2.     Cost of Goods Sold from 2/1/19-1/31/20 if you separately state this on your tax return as such. Otherwise, enter $0

3.     Business Legal Name

4.     Trade Name (this is your DBA name if applicable. Otherwise, enter your business name here as well)

5.     EIN/SSN for Sole Proprietorship

6.     Organization Type (C Corp, S Corp, Partnership, LLC, etc.)

7.     Business Address

8.     Business Phone Number

9.     Business E-mail

10.  Date Business Established/Incorporated

11.  Current Ownership Dates

12.  Business Activity

13.  # of Employees as of January 31, 2020

                                                   ii.     Basic information about the owner(s) with greater than 20% ownership.

e.     Here is where you go to apply:

                                                    i.     You can apply by going to

2.     Apply for the Paycheck Protection Program

a.     The first thing you need to do is call your bank to see if they will be participating in this. A lot of banks are turning away applications for this if you are not currently banking with them.

b.     Banks can start accepting applications on April 3, 2020.

c.      The maximum loan amount is 2.5 times your monthly payroll, up to $10 million, with an interest rate of 4%

d.     A portion of the loan CAN BE FORGIVEN.   Subject to certain restrictions, the portion of the loan eligible for forgiveness can include payments made during an 8 week period following your loan origination (which we interpret to mean funding) for the following:

                                                    i.     Payroll

                                                   ii.     Benefits (i.e. health and dental premiums)

                                                 iii.     Interest payments on mortgages

                                                 iv.     Rent payments

                                                   v.     Utility payments

e.     You will need to submit a request to the lender that is servicing the loan for forgiveness. The request will include documents that verify the number of full-time equivalent employees and pay rates, as well as payments for the above- mentioned items.

f.       These loans will be unsecured loans that DO NOT require personal guarantees

g.     You may be able to defer payments up to 6 months

h.     Gather the documents below. Please keep in mind that the items listed are not meant to be a complete list, but a good jumping off point. The required documents that will be needed are constantly changing. PLEASE CONSULT WITH YOUR BANKER WITH WHAT ITEMS THEY ARE REQUESTING.

                                                    i.     2019 payroll information including:

1.     IRS Form 941 for all four quarters of your 2019 payroll

2.     Health insurance premium information for 2019

3.     Retirement Plan contributions made in 2019

4.     A copy of a payroll summary showing total pay, taxes, etc. for all of 2019 and year to date for 2020

                                                   ii.     Copies of business property lease and/or mortgage statements

                                                 iii.     SBA Paycheck Protection Application Form. This can be found here:

                                                 iv.     2019 Utility bill statements

                                                   v.     General liability insurance certificate

                                                 vi.     Business Financial Statements-interim 2020 Financial Statements as well as a full year 2019 Financial Statement

                                                vii.     Business Tax Returns-Last 3 years

                                              viii.     Current organizational documents-Bylaws, articles, and operating agreements

                                                 ix.     COVID-19 impact statement

                                                   x.     8-week forecast of payroll, rent or mortgage interest and utilities

i.       BE PATIENT. The banks are being bombarded with loan requests, so this will take some time to sort out. As we mentioned in our previous communications, please continue to preserve your cash as much as possible. We estimate that the loan proceeds will not be available for at least 2, if not 4 weeks.

j.       We at PBM can assist with SOME of the items being requested. Please be patient with us as well as we are trying our hardest to help put you in the best position to take advantage of these loans as quickly as possible. We are more than happy to assist in doing this.


We estimate this will take PBM 2-3 hours to pull together the information that will be requested. Please contact your banker to determine what is needed before we start assembling our package of information, so time isn’t wasted. PBM will be billing at our regular hourly rate for any work assembling this information. If you have any questions, please contact your consultant at PBM.


To request our assistance with this, please respond to this e-mail or e-mail us directly at This email address is being protected from spambots. You need JavaScript enabled to view it.. We will be working in the order in which requests are received. Thank you for your understanding.


Here are some reference materials about the loans available:




Special Note: Coronavirus (COVID-19) Impact-Staffing Update

Staffing Issues

Navigating the path ahead with your employees during this difficult time is a process that warrants careful planning and cooperation. We are not attorneys nor is anything in our communications intended as a substitute for legal advice.  Here are some business issues to consider:

1. Employees with written employment agreements—Communicate, Communicate, Communicate:

a.      Review all “notice” provisions and employment terms and discuss these with the employee.

b.     Discuss the financial impact of the practice’s forced slowdown with the contracted employee.  If they have never owned a business, you may need to educate them about this.

c.      Develop work plans for the coming week and likely alternatives for the subsequent 2 weeks thereafter.

d.     Considering the adjustments to workload and the resulting decline in practice income, discuss adjustments to compensation including

                                                    i.     Base Pay

                                                  ii.     Incentive Pay

                                                iii.     Benefits—such as payment of health insurance premiums

e.      Ideally, this should be a collaborative process between owner and employee.

f.      You should consult your practice’s attorney throughout this process to ensure that you don’t inadvertently fail to address vital legal aspects of your relationship.


2.     2. Employees without written agreementsCommunicate, Communicate, Communicate:

a.      Weekly—Communicate your plans for the coming week, including:

                                                    i.     Communicate Work Hours

1.     In Office

2.     Telecommuting—we have resources regarding “Work from Home” policies.  Please reach out for more information if needed.

                                                  ii.     Establish Weekly work goals for each employee.  Do this for both those working in the office and those working from home.  We have a number of ideas about this.

b.     For those working at home, establish a weekly assessment to review what worked and what didn’t the prior week. 

c.      Longer term—quite difficult to make concrete plans given the near-term uncertainty.  Emphasize your desire to return to “normal” as soon as conditions permit.


3.     3. Terminations, Furloughs, and Layoffs—Employees Without Written Agreements

a.      If you terminate an employee, it is considered best practice to pay them their earned/accumulated vacation/pto time, and our understanding is that you must pay them for their earned and accumulated sick and earned paid time off.  Consult your attorney for legal guidance on this matter. 

b.     A furlough is considered an alternative to a termination or layoff.  You may require furloughed employees to work fewer hours or take unpaid leave.  You may ask nonexempt “hourly” employees to reduce hours, but you must be careful when furloughing exempt employees due to issues relating to the Fair Labor Standards Act. 

c.      A layoff is a temporary separation from payroll.  Employees are laid off because there is not enough work for him or her to perform.  Both employer and employee hope that the layoff is temporary.


In any situation involving a reduction of hours or of employee (work force) review your handbook (if you have one) and be sure to Communicate, Communicate, Communicate:

1.     Updates regarding the business/practice:

a.      Continuation of status?

b.     Return to work?

c.      General Practice Information

2.     Pertinent Issues Relating to an Employee’s Benefits

a.      Group health plan—how will premiums be handled—contact group insurance provider/broker

b.     Retirement Plan—payouts take up to a year, so be sure to set expectations.

c.      Other group benefit plans such as life insurance, disability, cafeteria plans etc.


4.     4. Unemployment Insurance—Before and After the CARES ACT—Effective 4/1/2020 

a.      Before the CARES ACT Illinois and Indiana offered benefits that roughly equated to 47% of most employees’ weekly compensation.  The weekly benefits were capped at $471/week for Illinois and $390/week for Indiana.

b.     After the CARES ACT these benefits are enhanced by $600/week, and the CARES ACT increased the benefits payable to those working fewer hours, making it more attractive to continue part-time work rather than claim full-unemployment.

c.      Before and After the CARES ACT, in Illinois you should give any employee who is laid off for a period of 7 days or more the publication found in this link:


5.     5. Families First Coronavirus Response Act becomes effective from 4/1/20 to 12/31/2020

a.      Stay tuned: Health Care Providers and their employees may be exempt from this. 


b.     Every employer under 500 employees is subject to this. 

c.      There are two benefits resulting from this act which are outlined in the required poster that you must exhibit in your office.  Please follow the first link below, print, and display the poster as required.  The second and third links provide additional information about these benefits.

d.     We have developed a spread sheet to assist in the calculation relating to the computation of these benefits.  Additionally, we are developing a simplified set of questions to assist you in determining an employee’s eligibility for either of these benefits.


Below are additional resources that you and your employees may find useful:






Special Note: Coronavirus (COVID-19) Impact-Financial Update

 Financial FAQ

1. How does our business preserve money necessary to survive during upcoming weeks and months?

·       Clients are preserving cash by:

o   Postponing the funding of company retirement plan contributions.

o   Contacting major vendors to coordinate delay in bill payments.  This includes: 

§  Landlords

§  Major Medical Suppliers

§  Malpractice Insurance Premiums

§  Group Health Insurance Premiums

§  Other Vendors with significant activity/ amounts due 

o   Contacting any lender with whom you have an outstanding balance to negotiate longer repayment periods

o   Reducing owner compensation as much as possible

o   CARES ACT allows individuals to postpone payment of retirement plan loan installments due through 12/31/20 for up to one year.

o   The new unemployment benefits associated with the CARES ACT provides enhanced benefits to employees working reduced work schedules.  Prior, to the CARES ACT employees might have benefitted from being laid off vs. working a reduced schedule.   The enhanced unemployment benefits are meant to incentivize employers to keep staff on the payroll at a reduced schedule while minimizing the financial cost to the employee

2. How does our business access additional money needed to survive? 


o   Create or increase a bank line of credit

o   Loan from personal resources—at a competitive rate of interest

o   Medical Practices with Medicare reimbursements can possibly apply for an advanced payment from their carrier based on their Medicare collections from the last three months.  Information about this program can be found in these links:



 For information call the Illinois provider hotline--NGS 888 802-3098, or Indiana hotline: 844 209-2567.  Payments made electronically within 7 days. 


§  Individuals, (including each business owner) can borrow up to lesser of $100k or 100% of his/her vested account balance in the retirement plan.  In turn, this money can be lent to the business to provide needed cash liquidity.  Loan repayments to the retirement plan can be delayed for up to one year.  This may be disadvantageous given the current state of the stock market and the possibility of depleting investible resources before an upward move in the market. 

§  Similarly, individuals impacted by COVID-19 (again including business owners) can avoid the 10% penalty on early retirement withdrawals of up to $100,000 (IRAs or retirement plan) and spread the tax owed over 3 years.  Additionally, the amount taken can be returned to the account over the next three years without impacting contribution limits. 

o   SBA/Economic Injury Disaster Loan—this was referenced in our email from last week.  See chart for additional information.  This may be incompatible with Payroll Protection Act Loan as the proceeds from this cannot cover the same expenses as those covered by the Payroll Protection Program Loan.


·       Funds Available in Coming Weeks

o   SBA/Economic Injury Disaster Loan—we are hearing about delays in this program due to application backlog.  Remember that there is limited forgiveness of $10,000 associated with this loan—refer to the Loan Comparison Chart

o   CARES ACT SBA Payroll Protection Program loan.  This is the program that virtually all clients will want to consider.  There are forgiveness aspects of this loan assuming you maintain staffing levels at 75% of pre-crisis levels.  In our opinion, the clearest description that we have found of this program has been provided by U.S. Chamber of Commerce. Link: 

As the last section of the publication points out, “Reductions in employment or wages that occur during the period beginning on 2/15/2020 and ending 30 days after enactment of the CARES Act.” will not reduce loan forgiveness if levels are restored by June 30, 2020.  

 We should be able to help you expedite applications for this, given our understanding of and ready access to much of the documentation needed for this program: 

·       Financial Statements—including current year and full year 2019.

·       Tax Returns—last three (3) years of federal returns for business

·       2019 Payroll information

·       Current Organizational Documents—Bylaws, articles and operating agreements

·       General liability insurance information

·       Current building lease & any amendments



Tax Season Priorities:

Due to the coronavirus outbreak and the government responses, PBM has shifted its work priorities to better help our business clients navigate these unprecedented challenges and remain financially viable. 

Specifically, we have focused our staff to help with cash flow projections, loan applications, staffing strategies, and research on the thousands of pages of tax law passed or pending this month. 

Going forward, we will continue to process tax returns to meet the revised deadlines, and in many cases to complete return preparation well before the new due date of 7/15/2020.    There may be delays, but we will proceed mindful of the due dates for every tax return and payment obligation that we provide guidance for.  Here are the revised deadlines:

  • Due on April 15:

o   First quarter 2020 estimated taxes for Illinois and certain other states

o   2019 gift tax returns or an extension for them

·         June 15:

o   Second quarter 2020 estimated taxes due for Federal and all states

·         July 15:

o   Filing and payment deadline for Federal 2019 income taxes

o   Filing and payment deadline for Illinois, Indiana, Wisconsin, and most states

o   Extension deadline for Federal and most states

o   Last day to fund an IRA for 2019

o   Last day to fund an HSA for 2019


Thank you in advance for your patience and understanding as we all are working to get through these times together.



Legislative Update:

 As of this writing, the US Senate has passed the third major piece of legislation, the CARES Act.  Passage by the House is hopefully Friday.  This Act is meant to add on to the first two pieces of legislation, so it will change the calculus of how to respond to these circumstances.  In general, here is some of what the CARES Act addresses:


·       Making SBA loans available and on favorable terms

·       Possible grants and forgiveness of a portion of small business loans

·       Payroll tax incentives

·       Changes to unemployment benefits

·       Incentives for employee retention

·       Direct payments to individuals making less than certain amounts


Even if passed as is with no changes, and that’s a big if, much guidance will be required by Federal agencies to provide clarity.  We’re living in a time of high uncertainty.


We can help.  Some of the items we can provide for making loan applications as well as sound business decisions (besides past tax returns and financial statements) are:


·       Cash flow projection for the next several months

·       Tax credit analysis to help determine staff retention strategies

·       Answers to certain loan questions


Please call us if you’d like our help with this.  We’ve developed tools to make this process as painless and cost effective as possible for you.  We’re in this with you.  We will coordinate work to be done with each client to limit our fees associated with the additional work. 


Tax Update:

Yesterday Governor Pritzker announced that Illinois would follow the Feds in extending the time to file and pay 2019 taxes from April 15 to July 15.  Unlike the Feds, Illinois will not extend the time to pay the first quarter 2020 estimated taxes. 

With this new information and given the challenges we face in assisting our clients through these uncertain times, we will be updating our work processing priorities for our staff already working under difficult circumstances.  Expect an announcement on that soon.



We are waiting for the federal government to pass the next “relief” legislation, and to provide additional clarity on the Sick Pay and Emergency Family and Medical Leave Acts.  In the meantime, both Illinois and Indiana small businesses can apply for SBA Disaster Assistance Loan.    

Key Elements Include:

·         Applications made directly to the Small Business Administration—not through a bank.

·         Applications include detailed histories of Profit and Loss, Cash Flow, Personal Financial Statements from owners and Statement of Liabilities.  Projected shortfalls suggested if the cash flow downturn expected in the future rather than reflected in the past.

·         Loans can be for working capital to cover ongoing expenses.  Not intended as debt consolidation loans.

·         Amounts over $25,000 will seek to secure loans with collateral, but lack of collateral will not disqualify loan candidates.

·         Terms 3.75% interest for up to 30 years for loans up to $2,000,000.  Terms and loan amount determined on a case by case basis.

·         No mention of forgiveness provisions.

·         Our understanding is that the application process expected to take a number of hours online, including compiling and reporting information, and review occurs within 3-5 days of the request with funding within 16-18 days.  Link with more information:


PBM: Operational Update—Potential Impact to Business Continuity

WE CONTINUE TO BE OPEN.  We are rotating the staff between working from home and our office.


Our network utilizes robust multi-factor authentication protocols and is securely backed up to a remote location.   Clients will have continued access to us through our phone, email and via various portals through the internet.


Given our technology, we are confident in our ability to continue supporting you with management, payroll, tax and accounting assistance while maintaining a safe working environment for our employees.  So far, the IRS has extended the tax filing and payment deadlines. We will update you about the Illinois state filings in the coming days.  We intend to continue working on these annual filings during this shutdown.



We will continue to provide you updates via email and through our website.



A link to the governor’s order is below, if you want some light reading.  It describes PBM’s services as essential, so we are keeping our physical office location open during our normally scheduled business hours of 8:30am-5:00pm Monday through Friday.


We will continue to communicate regularly via email and our website.  Please continue to check back here over the coming days and weeks for updates.


Lastly, we want to express our deepest gratitude to you for serving on the “frontlines” of this crisis.  YOU ARE APPRECIATED!!  Your efforts are truly heroic at times like this!



Website Link:




We have fielded a lot of phone calls/e-mails from clients asking about what steps they should take given the coronavirus pandemic. There are a lot of proposals being passed around about extending tax season, unemployment benefits, medical/sick leave, payroll tax cuts, how to pay employees, etc. A bill was passed in the House that addressed some of these, but it does not detail how this will be implemented, nor is it law, so stay tuned. Right now, these are just that, proposals.


Here is correspondence from the Illinois Dental Society with recommendations regarding closure through 3/31/20.


What we suggest:

  1. As stated in our previous letter:
    1. Secure a line of credit. We have contacts that we can refer you to.
    2. Avoid making large purchases or prepaying debt.
    3. Delay funding the employer portion of retirement plan contributions.
    4. Consider reducing your pay so the business has enough funds to operate.
  2. For your employees that need to be off of work to care for their family, we suggest that you continue to pay them at least for this week or until the benefits package gets sorted out by Congress and state.
  3. Consider rearranging well appointments in the morning and sick appointments in the afternoon and doing a thorough cleaning in between.
  4. Consider staggering staff schedules.

We are in uncharted territory, but as your business consultants, we want to help you position yourself to weather the storm. As soon as we get more information, we will be sending out further correspondence.






Business/Financial Observations

The current situation reminds us all that contingency plans are a necessity.  Besides cross-training employees to perform multiple functions when others are sick, please review your sick pay/time off policies to address your financial commitments to staff members.  In addition, please review the following list and update items as necessary:

·       Employee Emergency Contact Information

·       Criteria for suspending business operations as a result of employee illness or a cluster of illness in your local community.

·       Think about posting a sign in your office reminding patients to take precautions when experiencing any of the common symptoms such as fever, cough, and shortness of breath.

·       Emergency Operations planning should address

o   Phone coverage

o   Methods for communicating practice operations updates to staff

o   Method for communicating important information to nervous and sick patients

o   Continuity of basic business functions during a period of disruption:

§  Patient Scheduling

§  Paying Bills, including payroll

§  Depositing Funds

§  Billing and collections

o   The handling of clinical emergencies—particularly in dental offices.  

·       In most health-care practices, a large share of collections arrive 30 days after services are rendered and monies continue to be collected during the first 30-60 days after a business interruption.  Please evaluate your contingency plans with these cash flows in mind and determine your anticipated needs after that initial disruption. 


o   Postponing large financial outlays including

§  Equipment Purchases

§  Unnecessary compensation/bonuses

§  Unusual supplies purchases

§  Extraordinary Repayments of debt

§  Funding the employer portion of retirement plan contributions

o   Positioning the business to weather a 30-day disruption in cash flows by:

§  Renewing/establishing a business line of credit equal to at least 30 days of total practice expenses.

§  Evaluating personal financial resources should the necessity arise for the business owners to forgo compensation for 30 days.  This may include securing a personal line of credit or positioning investments to provide liquidity should the need arise.

§  Reviewing insurance coverage for business interruption coverage.  We are told that policies do not cover “pandemic” related business interruptions, but review your coverage in any case.

The likelihood of long-lasting disruption to your business appears small at this point, but planning for such a disruption should be an ongoing part of your business planning. 

For your reference, the Centers for Disease Control has created reference material for businesses:


Similarly, the U.S. Department of Labor has created a website for your reference:


Here are resources from the American Medical Association and the American Dental Association:


Here are resources from the Illinois and Indiana State Department of Health:


Here is another workplace resource that we found useful. It is from a law firm, and we do not render legal advice, so please consult your business attorney regarding legal matters.


PBM: Operational Update—Potential Impact to Business Continuity

In addition to providing timely business advice to clients, we feel that it is important to communicate how PBM is prepared to address our operational and business continuity.

As part of our operational plan, this virus could be categorized as an event which might compromise our office accessibility.  To address these rare situations, we have equipped all PBM employees with secure remote access to our computer network.  Our network utilizes robust multi-factor authentication protocols and is securely backed up to a remote location.   Furthermore, clients will have continued access to our various portals through an internet connection.

Given our operational setup, we are confident in our ability to continue to support our clients and maintain a safe working environment for our employees.  We will continue to monitor the status and progress of this outbreak, including any impact to our business, and provide future updates as appropriate.

So far, the IRS has not extended any tax related deadlines. Until they do, it will be business as usual. We will keep you abreast if anything changes.

If you have in-person meetings scheduled with any member of our team, please let us know if you would prefer a phone or digital meeting and we would be happy to oblige.