Paycheck Protection Act & Sole Proprietors (Artists and Authors Edition)

You may or may not know that the Fyeah Asexual blog is largely run by disabled mods. I write books, and another mod has an etsy store. While that’s not a complete picture, it does make me wonder about this the congressionally approved relief loans.

Many authors are sole proprietorships, and plenty of people who do business alone can apply for these loans starting today (April 10th). But authors and various other freelancers get their pay in funny ways so here’s a post of my understanding of what it means for possibly you, or maybe a struggling friend right now.

Key Points

  • While focusing on businesses with staff under 500 people, self-employees people count starting today (April 10th). It gives people up tp $10,000 dollars in forgivable loans to pay wages.
  • Loans over $10,000 have a maturity of two years and an interest rate of 1%. (Probably not relevant for you, but good to know for context of the bill itself.)
  • Borrowers must submit proof money i being used to cover pay. You’ll need payroll processor records, payroll tax filings, Form 1099-Misc, income and expenses from the sole proprietorship or bank records. (Most artists and authors have the last 3 in some form.)
  • The loan you can get forgiven seems to be 2.5 times your average monthly payroll. If you are dirt poor and not making much you can have your pennies multiplied by 2.5. (Hey! More money is more money.) You sadly cannot use the whole $10,000 to pay yourself minimum wage until it’s out and have it forgiven.
  • If a business laid off staff, they have until June 30th to rehire them.
  • 75+% of the business loan most be used for payroll. 25%- can be for any other expense.
  • It’s been suggested you apply at a bank you already are at, but not an absolute necessarity. It’s also a first come first serve process so if you think this is something that can help you apply today. [Here’s a list of banks you can apply with.]
  • You can apply if you were a business founded as early as February 2020.
  • I am not a loan professional, this is simply my understanding based on a business background and an author life. My sources are Investopedia’s article here, and CNBC article here.

Personally, I don’t think this is a fit for my situation but I wanted to make the details clear for anyone who thinks its a fit for their situation. The kofi is here if you want to support the blog directly.

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