Here at the Rules of Thumb blog from MoneyThumb, we always try to help our readers stay informed about things that matter to you. We have many customers who are small business owners and use our PDF financial file converters for their financial needs as a small business. We realize that many of you have been sorely affected by this pandemic and we strongly sympathize with your plight. The best way we know to assist you today is to clear up any misunderstandings you may have about the US government bailout programs for small businesses. This way, you will know where you stand and how to get money to keep your business afloat as quickly and efficiently as you can.

Our extensive research this morning led us to two articles we feel explain the US small business bailouts the best. Links to those two articles and a short description of what each article contains are listed below:

A Crash Course in the Small Business Bailout--This article is from Barron's. It was written on April 10, 2020, so it was meant to cover details of the first small business stimulus package, PPP, which as we said was used up very quickly, mostly by large corporations. (After much outrage, several corporations, such as Ruth Chris Steakhouse, have returned the money they received back to the government.) The information included in this article still helps explain a lot about the US government's small business stimulus and how to successfully maneuver the process. The article was written by Jared Hecht, CEO, and co-founder of Fundera, a marketplace for small business loans. Mr. Hecht has this to say in the article introduction, "I’ve personally had about 70 conversations with different banks along the way, and I’ve learned a ton about how this brand-new process works—and doesn’t." So we feel confident that the information you will glean from this article will help you as a small business owner overcome obstacles to getting financial help from the government during these trying times.

Confused by the Government's Small Business Loan Program? You are Not Alone: Here is Your Guide--This article is from USA Today and was written yesterday, April 23, 2020. The article is in a Q & A format. USA TODAY reporters Ledyard King and Paul Davidson interviewed several experts to answer questions about how small businesses can best maneuver the US government bailouts. One major question small business owners have is whether or not they have to repay the loan. Here is an answer to that question from the aforementioned article, "The portion of the loan that covers eight weeks of expenses does not have to be paid back if at least 75% of the money is spent keeping or rehiring workers. Otherwise, it carries a 1% interest rate and must be paid back within two years." Another pertinent question is how will this stimulus package differ from the first one when it comes to big corporations taking all the money before small businesses can benefit. Here is the answer, "To partly address the issue, $60 billion of the new funding is to be set aside for community-based lenders, smaller banks, and credit unions to assist smaller businesses."

The Rules of Thumb blog from MoneyThumb believes you will find all the answers you need as a small business owner on how to get US stimulus money for your business from the above articles. However, if you have a question you don't find the answer to in either of the above-referenced articles, by all means, leave us a comment below and we will find the answer for you.

Be aware that if you need to convert your small business bank statements as part of the loan process, we have a version of our PDF financial file converters specifically designed for small businesses. The time you save using our product should help you get to the front of the loan line much more quickly.

The post A Crash Course in US Government's Small Business Bailouts appeared first on MoneyThumb.

You would think the practice of borrowing money to pay taxes would be frowned upon, but the opposite is true. In fact, financial experts and the IRS itself suggest that business owners take out a small business loan if they don't have the ready cash to pay their taxes. Below are a few legitimate reasons why taking out a loan to pay your business taxes is a good idea from our friends at Fora Financial:

3 Reasons to Use a Business Loan to Pay Taxes

1. Interest Rates

The IRS treats the money you owe them like a loan and charges interest every day that your payment is overdue. Even worse, the interest on a tax debt is compounded daily until your balance is paid off, which means the amount you owe can grow quickly. Due to this, you should pay in full as quickly as possible to avoid expensive interest charges on your remaining balance.

Many alternative lenders offer business loans that can be used to cover your tax liability and at a far lower cost. And unlike interest accrued on an outstanding tax debt, interest on loan payments can sometimes be taken as deductions on your next tax bill.

2. Extra Fees

The Internal Revenue Service will take action if your bill is left unpaid; you’ll incur steep penalties. If you neglect to pay your bill, the IRS will impose an additional fee of half of one percent of your outstanding taxes due for every month that your payment is late. What’s worse, the late payment penalty is on top of accrued interest. To avoid this, apply for a business loan prior to tax season, so that you can avoid paying money in late fees.

3. Avoid Crippling Penalties

As a department of the Federal government, the IRS has the authority to dole out punishments for avoiding payment on your tax bill. The IRS may issue a tax lien, which gives them legal ownership of all your assets, including personal and business property.

A tax lien can have far-reaching implications for your business. It can affect everything from selling your business to obtaining credit. That is because the government will have first dibs on your firm’s assets if you default, which makes lending you money a much bigger risk.

If there is a tax lien on your business, you may not be able to obtain a business loan through a bank. You may, however, be able to borrow from alternative lenders that may be more willing to work with special situations.

Conclusion

If your business doesn’t have the funds to pay its tax bill, there are options other than to default. The nuclear option comes with far-reaching consequences, including damage to personal and business credit. Even if you decide to keep your business running, it may be crippled by the effects of your bankruptcy.

Using a business loan to pay taxes can help you avoid expensive interest payments and penalty fees. It can also prevent your operations from experiencing penal action from the IRS, such as tax liens. Consider seeking a business loan from alternative lenders, which are typically easier to obtain, and place fewer restrictions on how funds can be used.

If taking out a small business loan is looking like an option for you, MoneyThumb would like you to know we have a PDF financial file converter specifically designed for small businesses. This converter will help you get your financials in order for your chosen lender quickly and easily so getting a loan will be a breeze.

The post Should You Take Out a Business Loan to Pay Taxes? appeared first on MoneyThumb.

If you are considering creating a small business, you'd do well to read the following pieces of advice before getting started. The Rules of Thumb blog has collected what we consider the best advice from experts across the web on starting a small business:

Evan Carmichael--At 19, Evan Carmichael built then sold a biotech software company. At 22, he was a venture capitalist raising $500k to $15M. He now runs a YouTube channel for entrepreneurs with over 2 million subscribers and 300 million views, wrote 4 books, and speaks globally. Forbes called him one of the world's top 40 social marketing talents and Inc. called him one of the 100 great leadership speakers and25 social media keynote speakers you need to know. 

Here is advice on building a small business from Evan--"What successful entrepreneurs have in common are: 1) they had an idea that they were passionate about, 2) they did something about it and took action instead of sitting on it and watching someone else get rich from it, and 3) they persevered and had the conviction to follow through and not quit when times got tough."

Rieva Lesonsky--Two time CEO, small business expert, and former editorial editor for Entrepreneur urges small business owners to be more objective when starting their company. She suggests looking at everything through an outsider’s lens in order to remove biases and truly make the best decisions.

1. People will disappoint you. Don’t take it personally.

2. You always need more money than you think you do. Budget carefully.

3. Invest and don’t skimp on technology! The most current hardware & software really helps you be more productive and efficient, even if it’s a little more expensive.

4. You’ll get less sleep than you think you will.

5. All that said, it’s worth it.

Alexander Koury--Certified Financial Planner and CEO of Values Quest, Alexander Koury has this advice for entrepreneurs wanting to start a small business: "Starting a business is one thing, but making money is another. Setting appropriate timelines and financial goals for yourself can help keep you stable and focused on investing in your success. Look at your personal finances to determine how you can live as frugally as possible. Once you decide to invest in yourself and business, your goal should be to put all your financial energy into it."

For even more advice on starting a small business, the following two gems we found are well worth a read:

This article from Forbes, 10 Tips For Starting a Small Business You Haven't Heard a Thousand Times Already is great! Here is the first of those ten tips, "Countless people dream of becoming entrepreneurs, but they never do. They’re burdened with excuses and fears of failing. From money to time to responsibilities, you can make a million cases for not starting a business. Let’s face it, being your own boss is scary. In most cases, new business owners have a lot to lose with little insight into their chances of success. Worrying about the risks of business ownership is normal."

Patriot Small Business has this awesome post on their blog, 6 Startup Lessons Learned the Hard Way. This is the first of those six lessons, "How to Take a Punch: The thought of being your own boss is intoxicating. It’s a little like getting a puppy. You think about how much fun it will be holding and snuggling your puppy. How it will always be happy to see you and how you can chase it around in the yard. Your puppy is going to be so much fun that you’ll overlook all the bad stuff, like when it eats your furniture or takes a potty break on your new carpet, and how it needs 24/7 attention. Well, your business puppy will come full of hidden costs, economic downturns, failed business plans, lack of customers, demanding banks, startup business credit cards, sleepless nights, evaporating weekends, early mornings, and a lack of cash. Add it all up and It can all knock the wind out of you."

MoneyThumb and the Rules of Thumb blog believe by following the above advice you should have a solid foundation on which to build your new small business. We'd also like to share with you a free guide from Brian Tracy. He is a Canadian-American motivational public speaker and self-development author. Brian is the author of over seventy books that have been translated into dozens of languages. The free publication Mr. Tracy is offering is a 14-step goal-setting guide. You can download this free guide by following this link.

Good luck with creating your new small business! We hope you will share this post on your social media page so that your peers can benefit from the content as you have.

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To help you grow your small business in 2020, the Rules of Thumb blog from MoneyThumb would like to offer the following 4 tips that should be used by all small business owners for business growth:

1. Provide Great Customer Service--Without customers, you have no business, so it stands to reason that your first task--next to offering a great product or service--is to make sure you provide the very best customer service. Great customer service speaks for itself, so it is a given that word of mouth will spread that you are stellar at taking care of your customers. This will lead to new customers organically. In 2020 you want to personalize your experience with your customers and get to know them. This will go a long way toward making sure you stand out from your competitors.
2. Have a Great Website and E-Commerce Store--As a small business owner, we hope you realize that without a website you are pretty much considered a dinosaur. So many old-school business owners have balked about getting a website, but even they are now seeing the necessity of having one. Most people, when they decide to buy something, even if they are planning to buy the product or service offline, will do some research online before making their buying decision. If you sell online, you need to make sure your website is professional and user-friendly. Potential buyers who find a website that is amateurish and hard to maneuver will instantly leave your site and begin searching among your competitors. You should have an easy to use e-commerce system or shopping cart to make purchasing your product or service as simple and hassle-free as possible. Most small business owners are not digital gurus, so it is smart to hire a professional to build your site and e-commerce system. The right designer will save you a ton of headaches and lost sales.
3. Be Active on Social Media--You should at the very least have a Facebook page for your small business. It is even better if you are active on your Facebook page and you consistently communicate with your FB page followers. It can be fun, so don't be afraid of beginning. Just be yourself. Don't always be touting your product or service. Be a real human being. Get to know your followers, show interest in them and their lives and share your own struggles and victories. Many businesses choose to also have Twitter and Pinterest pages. LinkedIn is a great place to network with other small business owners. Once you get these accounts set up, sharing the post from your blog or simply maintaining contact with your followers only takes minutes of your time, but these minutes can add up to big growth for your small business. As with your website and e-commerce system, if you don't feel you have the skills to build and/or maintain them yourself, hire a professional to handle the job. It will well worth the money.
4. Be Open and Receptive to Change--We think the actor Alan Alda summed it up best when he said, "the secret of life is three words: adapt, adjust and revise." The world we live in now is constantly changing, and it seems more rapidly than ever. As a small business owner, to stay relevant you must be adaptable. Always be open and even receptive to change. Change is good. Don't fight it. If you see that something you are doing is not working, find a better way. Network with other small business owners and always be learning and growing. Improve your product or service, your customer service, your website and e-commerce system, and social media as needed. Be cutting edge. It will make you stand out from your competition.

Of course, MoneyThumb is a bit prejudice since we do sell the most popular product in our field, but we feel one last tip needs to be implemented to help grow your small business in 2020 and that is you should be using our PDF financial file converters created for small businesses. You will be amazed at the time and headaches this will save you when handling your small business financials.

We wish you the very best of luck with your small business in 2020. However, if you follow the above advice, you really won't need much luck at all.

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