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Payroll Protection Program – Updates and Application

The application for the Payroll Protection Program can see overwhelming. However, it is fairly simple to get through, especially if you use a trusted financial professional to guide you through the process.

Here is what we know and should help get you started:

  • Starting 4/3/20, small businesses and sole proprietorships can apply for loans.  Starting 4/10/20, independent contractors and self-employed individuals can apply for loans.
  • Because of the high volume anticipated, SBA has indicated that not more than 25% of the forgiven amount may be for non-payroll costs.
  • We believe “Number of Jobs” is number of full time equivalent employees – Please confirm with your bank – IT WILL BE IMPORTANT TO THE LOAN FORGIVENESS – since if it goes down, less may be forgiven. 
  • Loan forgiveness will be reduced if they decrease their full-time headcount 
  • Includes all employees – only the portion of salary in excess of $100,000 will be deducted from the maximum loan amount. Benefits do not go against this cap. If you have an employee that makes over a $100k their wages are capped, but add the benefits over and above that amount.
  • Loan payments (principal and interest) will be deferred for 6 months (interest still accrues during the deferment period) and after deferment, the loan will amortize over 2 years if it becomes a loan not forgiven.

EACH BANK MAY HAVE ADDITIONAL RULES AND REQUIREMENTS OF WHAT IS NEEDED – IT IS EVER CHANGING.

Link to the PPP Program overview and details: https://www.sba.gov/funding-programs/loans/paycheck-protection-program-ppp 

Link to PPP Application Form: https://home.treasury.gov/system/files/136/Paycheck-Protection-Program-Application-3-30-2020-v3.pdf  

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