April 22, 2020—
Dear Secretary Mnuchin & Administrator Carranza:
As the current economic situation has developed, another action was taken by Congress to create the Paycheck Protection Program (PPP). This program was designed to assist small businesses in retaining their employees during the crisis by providing business owners with funds to be able to retain and pay their employees while their businesses were affected by the current situation.
As you are aware, the funds allocated for this program were completely expended in a very short period of time, and only a small portion of businesses that applied were approved.
A number of larger business entities have received a majority of the funds from the initial funding. These corporations were not intended to be allowed to participate in this program as they have other means of getting capital. This program was designed and intended to be meant for small, closely held businesses, such as a medical office, a clothing store, a local restaurant, hair/nail salon, and the local hardware store. To give the larger businesses this money, when they have other means available to them that a small closely held business does not, takes this opportunity away from the small local businesses, and they may never recover. There are reports that many of these small businesses have already been forced to shut their doors and cease operations entirely, and in many cases, permanently.
In the strongest possible terms, we request the following actions be taken immediately:
- Review the policies for which the PPP was intended to operate.
- Request the funds given to these larger business entities be returned by them (Shake Shack has already announced that they are voluntarily returning the funds that they received from PPP) so that these funds may be disbursed to those small businesses that truly need the assistance.
- Modify the application so that an applicant shows more than just the average monthly payroll. We feel that a business should also be required to report their gross receipts in order to participate in the PPP.
- Place a limitation of amounts contributed to a pension plan to be included in the calculation of average monthly payroll. There is currently a limitation of $100,000 for an individual salary, but NO limitation on retirement plan contributions.
Unfortunately, it appears that the U.S. Department of the Treasury and the Small Business Administration are not operating the PPP program in the spirit for which it was created.
If the Executive Branch of the Federal Government wants to demonstrate its concern for small business owners, and their employees, we strongly feel that they should take IMMEDIATE action on the above suggestions.
Very truly yours,Neil. H. Fishman, CPA, CFE, FCPA, CAMS
National Conference of CPA PractitionersStephen F. Mankowski, CPA, CGMA
Co-chair, Tax Policy Committee
National Conference of CPA PractitionersSanford E. Zinman, CPA
Co-chair, Tax Policy Committee
National Conference of CPA Practitioners
The National Conference of CPA Practitioners (NCCPAP) is a professional organization comprised of Certified Public Accountants practicing in the United States. In addition to serving as a forum for education, networking, and community impact, NCCPAP also advocates for its clients. NCCPAP influences tax administration and tax policy by regularly meeting with Internal Revenue Service representatives, state taxing authorities, and elected officials. NCCPAP members represent over one million businesses and individual clients. The organization is headquartered in Woodbury, NY. For more information visit, www.NCCPAP.org.