• Welcome to OGBoards 10.0, keep in mind that we will be making LOTS of changes to smooth out the experience here and make it as close as possible functionally to the old software, but feel free to drop suggestions or requests in the Tech Support subforum!

I Just Got "Stimulated"

DistrictDeacon said:
The “fairest” way to do it would be to give the money to everyone now, and then take some (or all) of it back from higher earners when they file their 2020 taxes. But even Congress is smart enough to realize that most higher earners wouldn’t have the self control to not spend it.
Click to expand...

Which reminds me, the “optional” payroll tax withholding scheme is going to bite some people in the ass if it doesn’t get sustained.
 
bym051d said:
Which reminds me, the “optional” payroll tax withholding scheme is going to bite some people in the ass if it doesn’t get sustained.
Click to expand...

Did anyone actually do that? Other than government and military employers who were forced to?
 
Well I run the finances of a few companies, and between the tax deduction of the first PPP and the next PPP that just got announced, it seems rather silly to worry about who's getting $600 or $2,000, and not realizing that all these people who own all these companies are getting hundreds of thousands if not millions of free dollars.
 
Seems kind of like developing a vaccination program whut prioritizes some of the least vulnerable.

Because, you know, business.
 
stugotz said:
Well I run the finances of a few companies, and between the tax deduction of the first PPP and the next PPP that just got announced, it seems rather silly to worry about who's getting $600 or $2,000, and not realizing that all these people who own all these companies are getting hundreds of thousands if not millions of free dollars.
Click to expand...

ding ding ding
 
stugotz said:
Well I run the finances of a few companies, and between the tax deduction of the first PPP and the next PPP that just got announced, it seems rather silly to worry about who's getting $600 or $2,000, and not realizing that all these people who own all these companies are getting hundreds of thousands if not millions of free dollars.
Click to expand...

Exactly. Completely ridiculous. Our government will figure out any way possible to not help individual people. But they’ll help businesses under the guise of helping individual people.
 
PhDeac said:
Exactly. Completely ridiculous. Our government will figure out any way possible to not help individual people. But they’ll help businesses under the guise of helping individual people.
Click to expand...

That's been conservative philosophy since at least Hoover. One of the main complaints about Hoover wasn't that he did nothing to help people during the Depression, it was that most of the government programs he created to fight the Depression were aimed at helping businesses or banks or large groups and not families or individuals who were hurting. Hoover feared that if the government started helping individuals and families that it would ruin the Protestant work ethic and people would become dependent upon the government. It also became easy to portray him as cold and heartless. Conservatives love corporate welfare, it's the individual kind that bothers them so much.
 
Meanwhile businesses especially defense contractors have become dependent on the government.
 
Would you prefer defense contractors be dependent on homeowners ?
 
I’d rather there be less “need” for defense contractors. They could make other things. Beat their swords into plowshares so to speak.
 
The first round of PPP, as originally written wasn't too bad. It was based on a real formula that made some sort of sense, and it incentivized companies to keep their workers. It was basically get 2.5x your average monthly salary in a loan, and you can pay 8 weeks of salary + rent. We did the math on all this and we did as intended, we kept people on payroll we would have otherwise let go.

It's once they adjusted it to giving people the option of pushing it from 8 weeks to 24 weeks that the math stopped working. Companies could cut their workforce in half, and still get the full amount forgiven. Now that us accountants know how it works, the second round will have more of the benefits going to the owners.

Now of the two companies I work for, one has a revenue loss of 90% and the other has a revenue loss of 80%. One can recover and one won't. But this second round of PPP + the tax deductions really make it that even with revenue loss of 80% , and in one of the companies...we're going to have more cash coming this March than we did last March. By well more than a million bucks. We'll just go from 60 employees down to 30 for the time being.

Really , it should be industry specific. Lawyers don't need PPP funds. Neither do private equity investment companies, IT companies, etc. Although you can make an argument that just a quick throw money at everyone helped ease the pain back in March-June. But by now this 2nd round of PPP is just ridiculous. There needs to be a clawback of PPP funds that ultimately flow through to people with certain networths.
 
Last edited:
But couldn’t companies could just let the government pay their workers and pocket the payroll budget?
 
Companies don’t have to prove can’t pay their workers without the PPP funds, right?
 
PhDeac said:
Companies don’t have to prove can’t pay their workers without the PPP funds, right?
Click to expand...

In the first round pretty much everyone was eligible for it, as long as there was "uncertainty" which inherently there was for almost everyone. 2nd round they just need to show a 30% drop in revenue in any one quarter, so maybe some lawyers or certain businesses might not qualify. Nobody has to prove they can't pay their workers without it, usually cause it's not that black and white. Often times you can cut hours, pay cuts, etc., let some workers go and keep others, depending on the business.
 
So a company could use PPP to pay their workers and pocket what would normally be the payroll.
 
PhDeac said:
So a company could use PPP to pay their workers and pocket what would normally be the payroll.
Click to expand...

Payroll and Rent. Correct. So for people like lawyers who likely haven't seen much of a drop at all, it's just free money.
 
So PPP is a handout to businesses under the guise of helping regular people.
 
PhDeac said:
So PPP is a handout to businesses under the guise of helping regular people.
Click to expand...

Originally it was closer to being a help to regular people (and to businesses), but the changes they made to the calculation made it become less of a help to people and more to a help to business owners.
 
You must log in or register to reply here.
Back
Top