Paycheck Protection Program
Update: February 25, 2021
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Paycheck Protection Program
On March 31, 2020, the Department of Treasury released Payment Protection Program Application and official details. The Department of Treasury is continually updating information on their FAQ page here.
What do you need to know about the Paycheck Protection Program (PPP)?
- Schedule C borrowers can use gross income borrowing base for the PPP loan
- The SBA is offering PPP loans until March 31, 2021
- Paycheck Protection Program (PPP) first and second draw information and loan forgiveness, updated as of 2/25/2021
- There have been significant changes to the Employee Retention Credit based on the latest pandemic relief and economic stimulus bill
- The COVID-19 relief and spending package has been signed into law as of December 27, 2020
- For PPP loans under $50,000, there is a simplified application under SBA Form 3508S
- On November 18, 2020, the IRS issued additional guidance on PPP loan expenses and revenue
- There are many reasons to wait to apply for PPP Forgiveness, and five important reasons can be found here
- The SBA's list of FAQs for borrowers to rely on when applying for forgiveness can be found here
- Paycheck Protection Program updates, FAQs, and tools can be found here.
- The deadline to apply for the PPP loan is extended to August 8. Find out why you should apply if you have not yet here.
- On June 5, the PPP Flexibility Act was passed and updated PPP Loan Forgiveness Application FAQs can be found here.
- Small businesses and sole proprietorship are able to apply and receive loans starting April 3, 2020. Independent contractors and self-employed individuals are able to apply and receive loans starting April 10, 2020. Even though the program is open until June 30, 2020, we recommend contacting your lender and begin the application process immediately as there is a funding cap and lenders need time to process your loan.
- Loan amounts can be as large as 2.5 times your average monthly payroll costs over the prior year. The amount is subject to a $10 million cap.
- The loan proceeds can be used for payroll costs and benefits, interest on mortgage payments, rent and utility costs.
- In order for the loan or a portion of the loan to be forgiven, the loan proceeds must only be used on what is stated above. Also, the number of employees must be maintained and employee compensation must be maintained to a minimum of 75% of prior year compensation. Failure to maintain employee levels or maintain 75% compensation levels will result in a lower PPP Loan Forgiveness amount.
On May 26, 2020, the Small Business Association released the details relating to loan forgiveness including the instructions and application here.
On May 7, 2020, Paycheck Protection Program loan forgiveness for Self-Employed and 1099 Contractors can be found here.
On March 31, 2020, Payment Protection Program highlights including common Questions and Answers click here.
On March 31, 2020 The Department of Treasury released official details on Payment Protection Program click here.
The Paycheck Protection Program application can be found here.
More information regarding COVID-19 for businesses and individuals can be found here.
If you have received money from the PPP, find out how to maximize your loan forgiveness here.
Contact your EHTC Tax Advisor for more information and to determine what is best for you and your business. Please call us at (616) 575-3482 or email firstname.lastname@example.org.
At EHTC, we are constantly reviewing the evolving situation and restrictions that develop throughout the process. In order to be as caution as possible, we have closed our office and asked Team Members to work remotely until further notice. Rest assured knowing that EHTC is fully committed to delivering the outstanding services you’ve come to expect from EHTC. Thank you for choosing EHTC as your strategic partner and do not hesitate to reach out to us with any concerns or questions. Please call us at (616) 575-3482 or email email@example.com. Team members are available via email, phone and Microsoft Teams meetings.