EGIA

Unfiltered LIVE: Ask the Experts | Paycheck Protection Program

Question: Can you clarify how the PPP program handles outside sales people who earned over $100,000 in commission in 2018 and 2019?

Gary Elekes; EGIA faculty member and iMarket Solutions Founder:

2018 isn't going to matter. 2019 is a point of contention and we now have clarity as of this morning.

January 1, 2019 through December 31, 2019 is the window you want to look at for your payroll and then create a 12-month division. Say my average payroll is X, let’s just call that $250,000 a month. You’d multiply that by 2.5 to get your number.

The secondary question was, can I use January 1, 2020 through March 31, 2020 and start my fiscal year April 1, 2019 and the answer to that is, yes.

SI've got eight more people working in my company in the first quarter than I did in the first quarter of the previous, so definitely I've got more payroll now, so I’d be shorting the average payroll. So, that’s been clarified.

As for the $100,000 issue, it doesn’t matter if you're earning commission or you’re earning salary, you can’t count anything over $100,000. I had a salesperson earn $183,000 last year, so the company can get credit for $100,000 and the other $83,000 gets netted out.

Your bank really should give you a tool. Our banks gave us a tool but they weren't really that great. At the end of the day, you have to net out the $83,000 on some kind of a spreadsheet. We had about five employees that made over $100,000 and we did get credit for all of those employees’ salaries up to $100,000.

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