PPP FAQ

Who is Eligible?

• Small businesses with less than 500 employees
• Sole proprietors are eligible but are subject to specific requirements in order to establish the amount of the loan which they are eligible for.
• Borrowers must provide a “good faith certification” that
  • Uncertainty of the current economic conditions makes the loan necessary to support ongoing operations;
  • Borrower will use the proceeds to retain workers and maintain payroll or make mortgage, lease, and utility payments;
  • Borrower does not have an application pending for a loan duplicative of the purpose and amount applied for here
  • From Feb 15, 2020 to Dec 31, 2020 the borrower has not received a loan duplicative of the purpose and amount applied for here

 What documents do I need?

• The date you started your business
• Your annual revenue
• Business mailing address
• Borrowers must submit such documentation as is necessary to establish eligibility (which may include):
  • Payroll report(s) detailing the defined twelve months compensation
  • Quarterly or Annual payroll tax filings
  • Documentation verifying the number of employees on payroll for the defined period
  • Annual filings (W2s and W3, etc.)
  • Severance agreements and payments
  • Payment for health care benefits
  • Payment of any retirement benefit (i.e., employer match for 401k, or SEP IRA, etc.) including statements or contribution reports
  • Form 1099-MISC
  • Income and Expense documentation of a sole proprietor
• For borrowers that do not have any such documentation, the borrower must provide other supporting documentation, such as:
  • bank records, sufficient to demonstrate the qualifying payroll amount

How much can I borrow?

• Borrower can obtain loan for up to 2.5x the borrower’s average monthly payroll costs, not to exceed $10 million
• Payroll costs included in calculation:
  • Compensation (salary, wage, commission, etc)
  • Leave payments (vacation, parental, family, medical, sick, etc)
  • Payments made under group health plans including the cost of insurance premiums
• Payroll costs exclude from the calculation:
  • Compensation for employees in excess of $100,000 per year
  • Compensation for an employee whose principal place of residence is outside the US

 Will the loan be forgiven?

• Full principal of the loan will be forgiven if spent on covered expenses during the eight week period after the loan is made, subject to SBA requirements
  • Covered expenses:
    • Payroll costs
    • Interest on mortgage obligations incurred in the ordinary course
    • Rent on leasing agreements
    • Payments on utilities
• Forgiveness will be reduced if there is a reduction in the number of employees or a reduction of greater than 25% in wages paid to employees.