EIDL

Instructions to completing the EIDL Application

We’ve received numerous calls and emails about completing the EIDL Application with the SBA. Now that I’ve spent some time looking at the forms and limited instructions, I see why. Here are line by line instructions (based on my understanding of how they should be completed) that you can use as a guide.

Let’s start at the website for the EIDL application: https://www.sba.gov/disaster/apply-for-disaster-loan/index.html, and click on the first link under Download Business Forms to open up the Business Loan Application (Form 5), and begin filling it out.

Form 5, U.S. Small Business Administration DISASTER BUSINESS LOAN APPLICATION

Line 1: Check Economic Injury (EIDL)
Line 2: PC’s check Corporation, Partnerships check Partnership, and LLCs or PLLCs taxed as Corporations or Partnerships check Limited Liability Entity. Sole proprietors need to complete another form.
Lines 3-7 are self-explanatory
Line 8: Leave Blank
Line 9: Type in Your name and phone number
Line 10: Add other phone numbers
Line 11: Put Dental Practice or the name of your Specialty Practice
Line 12: Number of Employees
Line 13: When you set up the entity or purchased the practice
Line 14: The date you took over the practice, which is probably the same date as Line 13
Line 15: Leave blank
Line 16: You probably don’t have any insurance to cover this loss. If you do have insurance coverage, type it in here

Page :

Line 17: Put in your individual name and SSN here. Do not put in the name of your practice of the EIN in this section. Also, you will probably leave the Business Entity Owner section blank, unless you own a trust or an LLC that owns your practice.
Line 18: Answer all these questions
Line 19: Answer No
Line 20: Leave Blank
Line 21: Leave Blank
Sign the Bottom of the page


If you’re a Sole Proprietor or a Single Member LLC that has not elected to be treated as an S-Corp, please complete: Home or Sole Proprietor Loan Application (SBA Form 5C)

This form looks pretty self-explanatory


Next up is the Economic Injury Disaster Loan Supporting Information (Form P-019)

(This form is not actually included on the list of required forms as listed on page 3 of the Form 5. But it won’t take long for you to complete it.)

 

Start by checking the appropriate box about whether the business was in operation one year prior to the disaster.

Next, you need to get the previous 12 months of Gross Revenues. This would probably be Collections, unless you feel Production would better represent your practice revenue. You can get this information from your practice management system or from QuickBooks (if your books have been updated through 2/29/20).

For Cost of Goods Sold, our policy is to include Dental Supplies, Lab Fees, and amounts paid to non-owner Associates. You can get these figures from your QB, or you can take it from you 2019 practice tax return (it will be close enough). You can find this total Cost of Good Sold on your 1120S, Page 1 Line 2, or on a Schedule C, Line 4, or on your Partnership Tax Return Form 1065 on Page 1, Line 2.

Leave the next box for Rental properties blank.

I’m not aware of any compensation from other sources people may have received, but if you received any, list it here.

Sign and date the form on the bottom


The next form is the Request for Transcript of Tax Return (IRS Form 4506-T) According to the SBA Instructions, this form is the Tax Information Authorization (IRS Form 4506T), and needs to be completed and signed by each applicant, each principal owning 20 percent or more of the applicant business, each general partner or managing member; and, for any owner who has greater than 50 percent ownership in an affiliate business. Affiliates include, but are not limited to, business parents, subsidiaries, and/or other businesses with common ownership or management.

The SBA will use this form to get your Tax Transcript from the IRS.

Line 1: Put your individual name and your social security number
Line 2: If you are married and filed jointly, put your spouse’s name and social security number
Line 3: Current address
Line 4: Prior address if that is the address on the previously filed tax returns
Line 6: Put 1040
Box 6c: Already checked on the form
Line 7 & 8: Leave blank
Line 9: Already filled in

Sign and date at the bottom. Your spouse should sign and date if you are married and filed a joint tax return.


Next up is the Personal Financial Statement (SBA Form 413D).

Anyone who has ever applied for a loan before has probably completed a Personal Financial Statement before. It is a snapshot of what you personally Own and what you Owe as of a certain date.

Take your time and list all of the total of the various asset classes on the left side. On the right side list your liabilities. Under other assets put a value of your practice of approximately 80% of prior year’s collections less the amount of the outstanding practice debt.

Now here is where things get tricky. Net worth equals your Total Assets minus your Total Liabilities. And then when you add Total Liabilities to Net Worth, it should equal Total Assets.

Fill in the income section as best you can. For example:

On page 2, list who you owe money to. They also want a somewhat detailed list of your stocks and bonds, but I would just provide subtotals by an investment account instead of listing each security separately. You then list your real estate. Just do the best you can. You’ll be very close.

On page 3, list your various life insurance policies you hold.

And then sign and date.


Last up is the Schedule of Liabilities (SBA Form 2202)

It turns out that this is for the liabilities of your practice. If you filled in this form with your personal liabilities, then complete the form with your practice liabilities and upload the revised for to the SBA.

Here are the instructions from the SBA:


The final step is to download a copy of your most recently completed business tax return to your computer. You can find that tax return on your Client Portal. Sole proprietors will need to submit their personal tax returns because their practice income and expenses is reflected on a Schedule C included in that return.

Once everything is completed and signed, there is a box on the main page to upload everything to the SBA.

I think that is everything. Time is of the essence since there is only $10 billion allocated to this program, which means that only 1 million businesses can get $10k each. How the SBA will process this many applications is anyone’s guess.

17 thoughts on “Instructions to completing the EIDL Application”

  1. The SBA now has a streamlined application available on that webpage. It is taking my clients less than an hour to complete from what I’ve been told.

      1. Hi there! So are CPA’s not allowed to create SBA accounts and apply on our behalf?

        I am having a current issue with:

        I just got over $70K… my CPA filled out the app for me but didn’t tell me and I owe him some money so I get he wanted to get me the loan or whatever… but I am just asking for the application docs or login to the portal so I can see what info was claimed and he says the “ SBA opened a new terminal. These documents were bypassed”. So I can’t have the docs and they don’t have them because they were online and he also is saying that his firm applied for 4 different people under one SBA account so he can’t give me the login cuz I’d be able to see everyone’s. Can you let me know if this is normal? I’d appreciate it so so so much. Thanks!

      2. Hi Kelly, I’m sorry but we can only comment on what our firm’s process is. For our clients, they submit the application themselves but we are happy to help them with any reports or calculations they need for the application.

        You may want to contact the SBA disaster assistance customer service center directly yourself to investigate what was submitted under your name/identity. They can be reached at 1-800-659-2955 or by e-mail at disastercustomerservice@sba.gov

  2. Hello there and Thank you for the info…How does one submit the supporting documents to the SBA????????

  3. Hello there and Thank you for the info…How does one submit the supporting documents to the SBA????????
    There is missing info for submission of docs…
    Please advise

  4. hELLO,

    I’m a new business who started in April and I entered in 5000$ revenue and $6000 in cost of goods. 5 employees Do I have a slim chance of getting the EIDL grant?

    Someone told me I do.

    1. Hi,

      Based upon our understanding of the eligibility rules required by the SBA for EIDL grants, your business would not qualify for an EIDL grant due to the fact that your business opened in April 2020. According to the SBA, in order to be eligible for an EIDL Grant or disaster loan, the entity must have been in business as of January 31, 2020.

  5. I’m applying for our non-profit organization. How do I answer the questions “Owner” since there are no owners in a non-profit. Should I provide the president information as “owner”.

    1. Hi Keturah,

      We’d recommend contacting the SBA (US Small Business Administration) to get some clarification. Depending upon what type of nonprofit you’re representing, you might not be eligible for an Economic Injury Disaster Loan (as an example – religious organizations and charitable organizations are ineligible). For help with applying for an Economic Injury Disaster Loan, you should call the SBA at 800-659-2955 or email disastercustomerservice@sba.gov.

    1. Hi Lucio,

      This is what we found at: https://www.sba7a.loans/sba-7a-loans-small-business-blog/sba-loans-for-non-citizens

      If you’re not a U.S. citizen, can you still qualify for an SBA loan for your small business? The answer is yes— but not in all cases. In general, legal permanent residents (LPRs), also known as green card holders, can qualify for SBA financing. However, if a borrower is not a legal permanent resident, things can get a little more complex.

      I’d recommend that you contact the SBA to get this answer. They have been quite helpful to people with questions from what I’ve been told. For help, you should call the SBA at 800-659-2955 or email disastercustomerservice@sba.gov.

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      1. Are Trusts eligible for EDIL?
        The trust owns and rents commercial real estate.
        Due to the virus none if the tenants are paying rents.

        2. The organization: Trust is not mentioned.

        3. I am not the owner, just a trustee. How do I answer the questions “Owner” since there are no owners, only trustee.

        3. IRS Form 4506-T. The EIN to be of the trust or the ss of the trustee.

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