#11: CARES Act Live Q&A feat. Toby Mathis

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CARES Act Live Q&A feat. Toby Mathis

There is a tremendous amount of misinformation being circulated at a time when we need facts. 

That’s why we wanted to bring on Toby Mathis, who is one of the co-founders of Anderson Business Advisors. He is here to answer questions and give us guidance during this financially critical period. You can also reach out here for a free strategy session.

One of our topics will be the CARES Act and SBA loans. 

The government is trying to inject some money into our economy, which will help prevent economic destruction during this period. 

There’s something here for everyone, especially physicians – and a lot to cover. 

Let’s answer some questions.

Now, let’s discuss five things:

  • Who is affected by the CARES Act?
  • What does getting funds from the SBA look like?
  • How does the Paycheck Protection Program work?
  • Your retirement plan could be a source of immediate cash (we outline new laws around that).
  • You can apply for both the Paycheck Protection Program and the EIDL, but we’ll look at the boundaries for using them in tandem.

Here’s a breakdown of how this episode unfolds…

[01:36]

So, number one, if you're a physician, who is an independent contractor, sole proprietor, S corp, small business, partnership, whatever. There are provisions that affect you. 

[03:01]

So if you know there are a million applications that are going to come in in one day, you might want to be one of the first ones otherwise, you're gonna be waiting a long time.

[04:51]

Okay, So the bottom line is, the more organized you are, the more you can detect this sooner rather than later. Try to figure out what's going on. increases your chance significantly. 

[05:45]

So there are other ways to get money, and it's just making sure you're doing it correctly. 

[07:22]

I want to dive into the actual SBA loans and all that stuff, because I think that's what people are really interested in knowing, I guess, in particular, in their particular situation, which seems to be the best option for them. 

[11:22]

And if you're familiar with loan forgiveness, usually that's taxable. And they said, No, you don't have to recognize that as taxable income. So it's literally free money. But here's the catch, you lose the ability to do your employee payroll credit, that's also in the cares act. 

[13:06]

Now what if you're a W-2 physician, you're not working, now you're unemployed? Is there any benefit for someone like that in terms of these loans in particular or this grant? Or is that they have to, they have to kind of get the cash somewhere else?

[15:50]

All right, here's some specific questions. So max allowable w-2 wage is $100k. If your payroll wage for a doctor, it's normally higher. Can you reduce their wage temporarily to qualify for the loan?

[17:10]

It doesn't work that way. What they want is people to be working, and at a minimum getting 75% of what they're getting paid before and they're going to give you a tax credit. You know, not even a tax credit. They're just going to give you the credit, they're going to reduce the amount of the loan. So this is essentially a payroll grant. 

[20:33]

So if you're over 500 employees, as an organization, you can't do it. Now they did say this. If you have multiple locations, then they're waiving the association. So you could have one person, one group coming in there that has multiple locations across the US with, you know, 300 employees in each one, and take a huge chunk of this money. So yeah, you want to make sure you're in there. sooner than later.

And, if you haven’t done so already, let me know what you thought of this episode in one of our Facebook groups: Passive Income Docs or Passive Income Professionals

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