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Hoge Fenton Resources

06.19.2020 | Firm Post

On June 16, 2020, the U.S. Small Business Administration (“SBA”) released:

  • an updated Loan Forgiveness Application, and
  • an Alternative Loan Forgiveness Application for certain borrowers to implement the PPP Flexibility Act (“PPP Flex”), and
  • a revised interim final rule (the “IFR”) on June 17, 2020 implementing changes from the PPP Flex.

The updated Loan Forgiveness Application covers the following changes:

  • Alternative Payroll Covered Period applies to the 24-week (168-day) covered period; provided the Alternative Payroll Covered Period does not extend beyond December 31, 2020. Note: if a Borrower received its PPP loan before June 5, 2020, the Borrower may elect to use an eight-week (56-day) covered period.
  • Clarifies one of the Full Time Employee (FTEs) reduction exceptions: A position will not be included in the calculation if the Borrower made a good-faith, written offer to rehire an employee who was employee on February 15, 2020 AND the Borrower was unable to hire similarly qualified employees for unfilled positions on or before December 31, 2020.
  • Changes the documentation required for FTEs from the average number of FTEs per month to the average number of FTEs per week.
  • Employer health insurance and retirement contributions for business owners: employer health insurance and employer retirement contributions on behalf of a self-employed individual, general partners, or owner-employees of an S-corporation should not be included in the health insurance expenditures calculation or retirement expenditures calculation, respectively.

A copy of the updated application is here and the instructions are here.

A shortened version of the forgiveness application is available for the following borrowers:

  • Self-employed, independent contractors, or sole proprietors with no employees;
  • Borrowers who did not reduce salaries by more than 25% during the covered period and did not reduce the number of employees or the average paid hours of employees from January 1, 2020 to the end of the Covered Period (ignoring reductions from the safe harbor related to an inability to hire qualified employees, and reductions due to an employee refusing to accept a restoration of hours); and
  • Borrowers who did not reduce salaries by more than 25% during the covered period and were unable to operate during the covered period at the same level of business activity due to COVID-19 related safety requirements promulgated by the CDC, HHS, or OSHA.

The Alternative Loan Forgiveness Application is here and the instructions are here.

The SBA also released a revised interim final rule (the “IFR”) on June 17, 2020 implementing changes from the PPP Flex. The IFR provides the following:

Increases the cap on individual employees’ salaries from $15,385 during the 8-week covered period to $46,154 during the 24-week covered period.

Increases the cap on owner compensation from $15,835 during the 8-week covered period, to $20,833 for a 24-week covered period.

For sole proprietors: business mortgage payments, business rent payments, and business utility payments, as listed on Form 1040 Schedule C, are now included as amounts eligible for forgiveness.

Loan forgiveness amount cap: the amount of loan forgiveness is capped by the full principal amount of the loan plus accrued interest.

A copy of the IFR can be found here.

Our experienced team of attorneys are available to further assist you with any more questions or concerns you may having regarding PPP Forgiveness and PPP Flex.

Of Counsel
Corporate & Bus Law
+1.925.460.3367
Shareholder/Chair
Estates & Trusts
+1.408.947.2437
Attorney
Corporate & Bus Law
+1.925.460.3370
Shareholder, Chair
Employment Law
+1.408.947.2456
Shareholder
Real Estate & Commercial
+1.925.460.3365

This information is provided as an educational service by Hoge Fenton for clients and friends of the firm. This communique is an overview only, and should not be construed as legal advice or advice to take any specific action. Please be sure to consult a knowledgeable professional with assistance with your particular legal issue. © 2020 Hoge Fenton


06.08.2020 | Firm Post

A breath of fresh air for PPP borrowers! The Senate unanimously passed the “Paycheck Protection Program Flexibility Act of 2020” (H.R. 7010) (the “PPP Flex”) on Wednesday (6/3) evening and the President signed it into law today. The PPP Flex addresses many concerns with the PPP loan program and relaxes some of the requirements in the original PPP program. We expect the Treasury and the SBA to issue more guidance on the PPP Flex in the near future. Although the PPP Flex offers some relief and clarity, there are new considerations. Borrowers who already plan on using the PPP funds within the original 8 week covered period can choose to do so and may decide to request loan forgiveness as soon as possible. Below is a list of major changes covered in the PPP Flex bill:

Update PPP / Initial SBA Guidance  PPP Flex
1) Extended Loan Forgiveness Covered Period
8 weeks (56 days) from receipt of loan proceeds, or from first date of payroll period after receipt of loan proceeds for those eligible to apply “Alternative Payroll Covered Period”.
Earlier of 24 weeks or December 31, 2020. Borrowers who received a PPP loan before the date of the enactment of PPP Flex may retain the 8 week covered period.
2) Lower Payroll Cost Percentage Requirement At least 75% of loan proceeds must be spent on eligible payroll costs, otherwise the loan forgiveness amount will be proportionally reduced.
At least 60% of loan proceeds must be spent on eligible payroll costs. This now appears to be a cliff. (i.e., a Borrower who spends only 59% on eligible payroll costs will receive no forgiveness)*
[* Note: Subject to SBA regulation to determine if it is a cliff, but the current statutory language suggests it is a cliff ] 
3) Extended Reduction in Work Force Safe Harbor Rehire Date June 30th deadline to rehire employees separated between February 15, 2020 and April 26, 2020, to avoid a reduction in loan forgiveness. December 31, 2020 deadline to rehire employees separated between February 15, 2020 and April 26, 2020, to avoid a reduction in loan forgiveness.
4) New Exceptions for Borrowers who do not hire/rehire workers before the Rehire Date No reduction in loan forgiveness if the Borrower offers reemployment and workers reject the offer to return to work.
New exceptions (in addition to the prior exception) if the Borrower:
  • Could not rehire employees who were employed as of February 15, 2020; or
  • Could not find qualified employees to hire by December 31, 2020; or
  • Could not restore business to pre-February 15, 2020 level of activity because of social distancing or other federal health guidance/requirements
5) Longer Repayment Period 2 years  5 years (for loans after the enactment of PPP Flex; existing PPP borrowers might ask lenders to extend the loan.
6) Deferral of Employer Share of Payroll Taxes Not available for a Borrower who had the PPP loan forgiven.  Available for all PPP borrowers regardless of forgiveness status; allows Borrowers to defer payment of 50% of payroll taxes until 2021, with the remaining 50% due in 2022.  

Our experienced team of attorneys are available to further assist you with any more questions or concerns you may having regarding the Paycheck Protection Program Flexibility Act of 2020.

Of Counsel
Corporate & Bus Law
+1.925.460.3367
Shareholder/Chair
Estates & Trusts
+1.408.947.2437
Attorney
Corporate & Bus Law
+1.925.460.3370
Shareholder, Chair
Employment Law
+1.408.947.2456
Shareholder
Real Estate & Commercial
+1.925.460.3365

This information is provided as an educational service by Hoge Fenton for clients and friends of the firm. This communique is an overview only, and should not be construed as legal advice or advice to take any specific action. Please be sure to consult a knowledgeable professional with assistance with your particular legal issue. © 2020 Hoge Fenton


06.04.2020 | Firm Post

We are Here to Help

Hoge Fenton understands that our clients, employers, and organizations may have numerous questions and concerns about reopening their business. As you begin to face the business and legal implications of the COVID-19 crisis, our attorneys remain committed to assisting you overcome these obstacles.

To provide some guidance on some of the issues that have affected or will be affecting businesses, we have created a Reopening California resources page to support you in the following areas:


This information is provided as an educational service by Hoge Fenton for clients & friends of the firm. This communique is an overview only, & should not be construed as legal advice or advice to take any specific action. Please be sure to consult a knowledgeable professional with assistance with your particular legal issue. © 2020 Hoge Fenton


06.01.2020 | Firm Post

Thank you to everyone who joined us for the Notarization Alternatives for California Estate Plans webinar.

Please click below to watch the recorded webinar.

We hope you found the discussion with Trust & Litigation Chair Denise Chambliss beneficial. Please do not hesitate to reach out to Denise if you need more guidance.

Shareholder, Chair
+1.925.460.3364

This information is provided as an educational service by Hoge Fenton for clients and friends of the firm. This communique is an overview only, and should not be construed as legal advice or advice to take any specific action. Please be sure to consult a knowledgeable professional with assistance with your particular legal issue. © 2020 Hoge Fenton


05.21.2020 | Speaking Engagement & Firm Events

Please note: this webinar is by invitation only

COVID-19 is impacting the estate planning process in many ways, particularly notarization practices and assessing undue influence.

When an estate plan is executed in the future and a dispute arises, how will the courts assess estate plan irregularities that happened during the time of COVID-19?

As a veteran trust & estates litigator, Denise Chambliss will share her insights and perspective these issues:

  • Impact of COVID-19 notarization practices in litigation
  • Undue influence


Shareholder, Chair
Trust & Estate Litigation
+1.925.460.3364

This information is provided as an educational service by Hoge Fenton for clients and friends of the firm. This communique is an overview only, and should not be construed as legal advice or advice to take any specific action. Please be sure to consult a knowledgeable professional with assistance with your particular legal issue. © 2020 Hoge Fenton


04.15.2020 | Firm Post

Wealth Planning Opportunities in Tough Times

All-time low federal interest rates and currently low asset values provide historic opportunities for high net worth individuals to transfer wealth.
Take Advantage of Low Interest Rates: The IRS uses federal rates to determine the amount of gifts. Historically low interest rates make these estate planning tools more tax efficient:

  • Low interest rate loans and installment sale of assets to individuals or trusts.
  • Grantor Retained Annuity Trusts (“GRATs”), Intentionally Defective Grantor Trusts (“IDGTs”), certain charitable trusts and other multi-generational irrevocable trusts.

Take Advantage of Current Low Asset Values: Temporarily depressed asset values are an opportunity to efficiently shift wealth to individuals or trusts.
Take Advantage of High Estate and Gift Tax Exemptions. The current $11.58M (inflation-adjusted) estate, gift and generation-skipping transfer tax exemption is a temporary opportunity. The exemption will fall back to prior levels in 2026, but we see risk that the exemption could be reduced earlier due to the cost of the COVID-19 relief effort and changing politics. If you are planning to use the high transfer tax exemptions, we suggest you start the process soon.
Contact our estate planning attorneys to learn more about these historic opportunities and how they fit into your planning.

J. Timothy Maximoff
Silicon Valley Chair, Estates & Trusts
D: +1.408.947.2437
tim.maximoff@hogefenton.com
Karen A. Meckstroth
Firmwide Chair, Estates & Trusts
D: +1.408.947.2409
karen.meckstroth@hogefenton.com

This information is provided as an educational service by Hoge Fenton for clients and friends of the firm. This communique is an overview only, and should not be construed as legal advice or advice to take any specific action. Please be sure to consult a knowledgeable professional with assistance with your particular legal issue. © 2020 Hoge Fenton


04.03.2020 | Firm Post

Managing the Assets of Family who Passed Due to the COVID-19 Coronavirus

For many families in California dealing with the loss of a loved one due to the COVID-19 virus, the departed family member has passed without a will, without a trust, and without estate planning. This article provides an outline of what should be done to manage the family member’s property and assets.
The California Probate Code is the legal guide for the management and distribution of the decedent’s assets. When a person has passed away without a will, the process of management and distribution of the assets is called an “intestate probate”.
However, if the value of the decedent’s estate does not exceed $166,250, you should be able to distribute the assets without opening a probate. This is done using a “small estate affidavit” (Probate Code section 13100).
If the decedent was married, there is a simpler probate for the surviving spouse to gain full ownership of the couple’s community property. This process, known as a “spousal property petition,” requires a formal probate with your local county probate court.
Probate proceedings have many rules and complex procedures. Probates are often stalled in court because the rules and procedures are not followed precisely. This results in delays, which can create financial and emotional distress for the decedent’s family. A skilled probate attorney navigates the probate proceedings to avoid unnecessary delays and to settle the estate as quickly as possible.
At Hoge Fenton, our probate lawyers have extensive experience administering probate matters from simple single-house estates to complex estates with real property, businesses and investments.
Our probate team has handled inventory, valuation, and distribution of assets such as residential homes, commercial real estate, niche collectables, and business interests. In addition, we are experienced with contested probates which may include a surviving spouse and step-children from the decedent’s prior marriage.
Should you need to handle the assets of a recently deceased loved one affected by the COVID-19 pandemic, Hoge Fenton’s attorneys have the knowledge and experience to help navigate the post-death legal process with competency, care, and understanding.
Stay safe.

Denise Chambliss
Shareholder
Estates & Trusts
email here
Ariel Siner
Attorney
Estates & Trusts
email here

This information is provided as an educational service by Hoge Fenton for clients and friends of the firm. This communique is an overview only, and should not be construed as legal advice or advice to take any specific action. Please be sure to consult a knowledgeable professional with assistance with your particular legal issue. © 2020 Hoge Fenton

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