justanotheradmin Posted May 21, 2020 Posted May 21, 2020 Plan sponsor would like to use PPP loan proceeds to pay a portion of the administration expense. Expenses are billed quarterly, so there would be an amount due during the 8 week period. They would like to know if it would qualify for forgiveness if they use the money that way. I haven't looked into it much, but I'm leaning towards it wouldn't qualify since it seems to be limited to retirement plan contributions, not expenses. But i'm hoping one of you that has done all the reading and paid attention to the SBA information can confirm, or tell me if I'm mistaken. I'm a stranger on the internet. Nothing I write is tax or legal advice. I'd like a witty saying here, but I don't have any. When in doubt, what does the plan document say?
Larry Starr Posted May 21, 2020 Posted May 21, 2020 2 hours ago, justanotheradmin said: Plan sponsor would like to use PPP loan proceeds to pay a portion of the administration expense. Expenses are billed quarterly, so there would be an amount due during the 8 week period. They would like to know if it would qualify for forgiveness if they use the money that way. I haven't looked into it much, but I'm leaning towards it wouldn't qualify since it seems to be limited to retirement plan contributions, not expenses. But i'm hoping one of you that has done all the reading and paid attention to the SBA information can confirm, or tell me if I'm mistaken. If they contribute it to the plan (and then the plan pays it), it will count. If they pay it directly from the business, it will not. If it is automatically taken out of the account, it is not even an issue for discussion since there was no payment from the business. justanotheradmin 1 Lawrence C. Starr, FLMI, CLU, CEBS, CPC, ChFC, EA, ATA, QPFC President Qualified Plan Consultants, Inc. 46 Daggett Drive West Springfield, MA 01089 413-736-2066 larrystarr@qpc-inc.com
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