Financial Advisory Blog

Armanino’s Financial Advisory blog is your source for thought leadership around cloud ERP and accounting solutions and integrations. Supported by the Cloud Accounting Institute and numerous experts in cloud, finance, reporting, integration, compliance, and technology, Armanino’s Financial Advisory blog features must-read content on what’s happening in the finance industry, case studies, white papers, and much more.

July 23, 2020

We have a commission-only employee (no hourly wage or salary) who earned considerably less during the eight-week Covered Period than during the first quarter of 2020. Am I correct in presuming this will count as a salary reduction when calculating loan forgiveness?

Posted by Armanino Financial Advisory Team

No, that is not a correct presumption. If the employee’s commission rate stayed unchanged, but the outcome was lower because they failed to meet the first quarter performance levels on which the commission is based, it would not qualify as a Salary/Wage Reduction. Conversely, had the employee performed at an equivalent level but you lowered the commission plan so that the payout was less, that would trigger the Reduction Factor (if the rate dropped by more than 25%).

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