Points of Interest: First Quarter 2021

All the Small Things

We love to celebrate your wins. If you paid off your start-up debt, filed that patent, got the promotion, or grew your business, we’re going to be right there cheering with you, because that’s amazing!

But the small wins — the ones that typically go unnoticed, that you don’t see on social media? We love those even more. Because they have transformational power.

Turns out , we aren’t as productive when our goals are too big. It overstimulates our brains, and we can’t deal with them as rationally. But when we narrow our focus to solve smaller problems, we’re better able to build on their success. This is a core concept behind Profit First, but you can apply it to all aspects of your healthy new year.

So, what does a small win look like? Anything really! Here are just a few examples of tiny victories you can celebrate on the way to bigger goals:

Celebrate all the wins! Keeping a running to-do list is helpful, but keeping a running “done” list is better. Reflecting on what you’ve done each day can help you learn from your wins and keep that mood momentum going.

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Facts & Figures

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Buddying Young Minds

Go Figure has committed to the Book Buddy Program to support child literacy. And we challenge you to do the same. With your help, we can help children start kindergarten with the skills they need to thrive.

Here’s how it works: Book Buddies are matched with a 3 or 4-year-old in a child care classroom in Orange County, Florida, and exchange letters and books throughout the school year. The Volunteer Book Buddy commits to purchasing three books and exchange three letters with their Book Buddy through an online portal. ELCOC coordinates all correspondence for the privacy of the volunteer and child.

That’s it — three letters, three books, and a lifetime passion for reading is born! To learn more, visit elcoforangecounty.org/get-involved.

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Healthy Figures

Newsflash: Health and wellness is taking top priority for the majority of Americans in 2021. This not-so-shocking headline comes via the annual New Year’s Resolutions Study conducted by Allianz Life Insurance Company of North America (allainzlife.com). And while no one is surprised given 2020’s physical and mental health challenges, it may be putting long-term finances at risk as far fewer people say they plan to focus on their finances in the New Year.

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I Got 1099 Problems

1. As a general rule, you must issue a Form 1099-MISC or 1099-nec to each person to whom you have paid at least $600 in rents, services, prizes and awards or other income payments. You are required to issue 1099-MISC reports only for payments you made in the course of your trade or business, and you’ll send it to any individual, partnership, Limited Liability Company, Limited Partnership or Estate. You don’t need to issue 1099s for payments made for personal purposes.
2. The penalties can vary from $30 to $100 per form ($1.5 million for the year), depending on how long past the deadline the company issues the form. If a business intentionally disregards the requirement to provide a correct payee statement, it is subject to a minimum penalty of $250 per statement, with no maximum.
3. One of the smartest procedures a business owner can implement is to request a W-9 from any vendor you expect to pay more than $600 before you pay them. Using this as a normal business practice will give you the vendor’s mailing information and Tax ID number, and it’ll also require that the vendor indicate whether they are a corporation or not (saving you the headache of sending them a 1099 next year).
4. You are required to issue and essentially mail out all your Form 1099s to your vendors by January 31. Then you have to send in the transmittal Form 1096 to the IRS. For those of you that ‘outsource’ this service, your accountant with the proper system can actually submit the forms electronically by March 31. Don’t forget! Depending on state law, you may also have to file the 1099-MISC with the state.

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Stimulus Updates

Loans to Small Businesses

The act provides more than $284 billion to reactivate the Paycheck Protection Program to provide low-interest-rate loans through the Small Business Administration (SBA). As before, these loans are intended to help business owners retain their employees, keep operations going, and pay themselves. They’re not only low-interest; they’re also forgivable (meaning you don’t have to pay them back!) if you use them for the stated purpose.
Companies, nonprofits, self-employed people are eligible for a loan if they have 500 or fewer employees, up to a cap of $10 million.

If you got a PPP loan already, you can apply for another one, but there are more restrictive requirements: You have to have 300 or fewer employees and be able to show a 25 percent or more reduction in your gross receipts during any quarter in 2020 compared with the same quarter last year.

That’s to focus money to the smallest businesses and nonprofits.
Second-draw borrowers should be able to borrow up to two and a half times their average monthly payroll costs up to a cap of $2 million — or three and a half times your payroll if you’re in the food services or accommodations industry.

The agreement also sets aside money for PPP lending through community development financial institutions (CDFIs) and minority depository institutions (MDIs). This is intended to address some of the shortcomings in PPP lending to underserved communities. It also adds money to invest in and support these lenders.

Grants

New with this amendment, $15 billion in dedicated funding will go to hard-hit live venues, cultural institutions, and independent movie theaters. The SBA’s Office of Disaster Assistance will disburse grants of up to 45 percent of 2019 gross revenue (with a $10 million cap) to eligible organizations.

The act also adds another $20 billion for grants for business owners for COVID-19 relief through the Economic Injury Disaster Loan program. You have to choose either a PPP or EIDL loan, so look into both to see what makes the most sense for you.