NOTICE: Per the SBA, the Paycheck Protection Program is currently on hold, as the money has run out. The Senate passed a $484 billion bill that includes an additional $310 billion for the Paycheck Protection Program. It now goes to the House and then to the President who indicated that he would sign it.
What is the PPP (Paycheck Protection Program)?
The Paycheck Protection Program (PPP) is a loan that helps you keep your employees employed during the coronavirus crisis. The loan is forgivable, provided that you use it to keep employees on the payroll for eight weeks. You can also spend the funds on rent, mortgage interest, or utilities.
Who Is Eligible For Paycheck Protection Program?
You apply for the PPP loan through an approved SBA 7(a) lender (call us, and we’ll hook you up with one). The process began on April 3rd, 2020 and goes through June 30, 2020, under the current CARES Act.
The following businesses qualify and should apply:
- Sole proprietors, independent contractors, and self-employed persons.
- Businesses whose NAICS code begins with 72 (Accommodations and Food Services) with more than one location and less than 500 employees per location.
- Businesses defined as “Small Businesses” according to the SBA’s size standards. No, that’s not an easy definition. Check the SBA for size standards.
You can start your application here: https://www.sba.gov/document/sba-form–paycheck-protection-program-borrower-application-form
Learn more about the CARES Act in Part 1 of our COVID-19 Relief Series.
How does the PPP loan forgiveness work?
If you keep your employees or quickly rehire them, you’ll be eligible for PPP loan forgiveness. While you can also use the funds as mentioned above for rent, mortgage interest, and utilities, at least 75% of it must be used for payroll. The amount forgiven may be reduced based on a percentage of the workforce kept on.
The loan is a 2-year term at 1% interest.
Start the Process Now
Give our office a call right now at 888-297-3321, and we’ll help get you through this crisis. We’ve been through economies like this before, and we can help you and your business get through it. Schedule a free consultation today. ASCEND is here for you.