I have a client that just got approved for the PPP and will be receiving his funding next week. I have suggested that he open a new checking account so it would make the reporting to the bank and journaling easier for me. He currently uses Intuit full service payroll to process his payroll and then I import the file to his quickbooks desktop. His checking account is linked to a available funds account that was created so he wants me to create another account entitled PPP that will link to his checking account and the available funds account. Can this be done? It seems like the reports will be a nightmare. Any better suggestions?
8 weeks, ONLY 8 weeks. You are complicating something that , while complicated to begin with, only requires date-based reports
1. if there are ANY unpaid payroll liabilities QB will NOT let you change designated payroll account.
2. Payroll reports, cancelled checks, utility receipts, THAT is all that is going to be necessary to prove expenditures.
The only reason I would see for a new account is if one applied through a bank they do not normally do business with and that bank demanded a new relationship other than the loan. But you can bet that INtuit Capital will not require you get a bank account from them (since they do not offer checking accounts but were approved as a non-traditional lender for the program)
We are not working with a new checking account and do not see any underlying need to. The loan is booked as a loan. The forgiveness will be booked as non-taxable income.
Do you plan on splitting the first payroll and the last between bank accounts? The 8 weeks starts the day of funding (I am going with day of deposit until told otherwise as how can one spend money one does not have a hand on) According to a town hall meeting with my Congressman, the 8 weeks of payroll is not th next 8 weekly payroll periods but is for the 8 weeks starting, as I said, when you are funded - which means next week's payroll might NOT even include ANY PPP covered payroll, or may only include 2 or 3 days. I, myself, are still pondering running two separate payrolls and two separate checks for employees this coming Friday. We run bi-weekly and at a minimum a little more than one week would be under PPP but 2-3 days might not. I will have to adjust one flat rate local services tax so that it is not deducted from both checks but that is about the worst of it. However, since PPP loan is not specific to the type of wages, it can even be used to pay time off that is not under National Paid Leave
Thus, what I see as more important than a new bank account that will be deleted in about 10 weeks never to used again is to use timesheet entry for employees to be able to produce a payroll summary report for the exact 8 weeks paid, regardless of paycheck date. If the Payroll Summary reports were good enough to get the loan then they are good enough to use for forgiveness.