SBA "Economic Injury Loan" Info

Finance SBA Loans
1

Economic Injury Disaster Loans

If you have suffered substantial economic injury and are one of the following types of businesses located in a declared disaster area, you may be eligible for an SBA Economic Injury Disaster Loan (EIDL):

  • Small Business
  • Small agricultural cooperative
  • Most private nonprofit organizations

Details here:
https://disasterloan.sba.gov/ela/Information/EIDLLoans

2

It says that if we recieve one of these loans, we may not be eligible for other grants later, and my accountant thought the 3% intrest rate could be better. Thoughts? Thanks

3

Dr. Miller-

What you said makes perfect sense- which is why I recommend the following:

  1. Consult with your accountant before you do anything (they have time tanks to the delay to file tax returns)
  2. Consider asking your bank to provide or expand your line of credit
  3. Start having th conversation with partners (and your spouses) that now is the time to start taking reduced salaries/draws out of the practice even though the decrease in revenue is not expected for another couple of weeks.
  4. Have open and honest communication with staff that business will be getting slower and to expect that there will be reduced hours (and therefore reduced payroll to them).

-Paulie

4

If we can get EIDL and PPP, can Eidel be used to cover the rest of payroll for the PPP<$100k restricted employee? For example, Dr G makes $120k. Can EIDL cover $20k and PPP cover $100k?

5

Looking for some help in this sleepy thread. :raising_hand_woman:t3:

I finally got back my EIDL answer (did get the $2k for me and my assistant) and they say that based on the ā€˜cost of goods soldā€™ numbers in my application Iā€™m not experiencing enough hardship. :exploding_head::woman_facepalming:t3: The silver lining is that I can appeal with more data, but I still donā€™t understand what the heck ā€˜cost of goods soldā€™ is for a practice.

What did anyone who got a loan use for cost of goods sold? I feel like cost of goods sold in medical practice is total overhead including salaries, and not offset by our income, but I couldnā€™t find anything helpful from the SBA or anywhere else explaining what numbers to use for a service business.

I did my application in the frenzy of get it in quick theyā€™re running out of money! Everything I found about what to use conflicted, and apparently I chose poorly. :tired_face: How do you show economic injury before it hits? I didnā€™t have decreased income yet in March and April when I was getting paid for Jan-Feb work. :woman_shrugging:t3:

TIA!

Dorin Kemmerle
Sprout Pediatrics
Salem, OR

6

I had the same question when filling out the EIDL loan application and actually called the SBA about it. They said that our vaccines would count as goods sold since we purchase them and ā€œsellā€ them to the patients. When I spoke to the SBA they didnā€™t make it sound like salaries would count so we didnā€™t include those; however, this article states that you might be able to include other costs that are incurred during the process of providing your service. https://bench.co/blog/operations/how-to-apply-sba-disaster-loan/

I would recommend talking to your accountant to get their interpretation of what counts towards cost of goods sold.

Cathy
Hilliard Pediatrics
Hilliard, OH

1 Like