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