Paycheck Protection Program Information
Late Thursday the Small Business Administration (SBA) issued an Interim Final Rule which modifies our last informative email, along with an updated application, for the Paycheck Protection Program (PPP) which will allow up to $349 billion in forgivable loans to small businesses for use to provide wages to their employees during the COVID-19 crisis. Businesses that are interested in applying for the PPP should do so now as there is expected to be a high demand for funds. It should be noted that all loan terms will be the SAME for EVERYONE.
Eligible businesses are those with 500 employees or less, and this includes sole proprietors and other self-employed individuals. Small businesses should contact their financial institution and inquire on if and how they are accepting applications for the PPP. Those planning to apply for the PPP can find the application here. Our firm recommends that when a small business applies for the PPP to have the following items available for convenience when completing the application:
- Quarterly Payroll Tax Returns
- Payroll Summary or Registers
- All W3’s and W2’s for 2019
- Form 1099’s as they apply to their contractors/vendors of service – No longer applies, the Interim Final Rule removed this
- Paid Employer paid insurance benefit invoices
- Proof of payment on retirement plan contributions
- Spreadsheet summarizing the Payroll Costs above to supply to banker to help them be organized
- Application Form
- Year end summary for 2019 health insurance premiums
Additional details regarding the PPP include:
- It is a temporary type of SBA Loan.
- Loan size is equal to 250% of the employer’s average monthly payroll, not to exceed $10 million.
- The loan can be used to refinance recent SBA Disaster loans.
- There are no personal guarantees and no collateral is required.
- Loan Forgiveness – The total amount forgivable equals what you pay in eligible payroll costs. Covering 8-week period starting on the loan origination date. These costs are payroll, rent, utilities and payments of interest on any covered mortgage obligation.
- For any unrelieved amount there will be a 2-year maximum term and a 1% rate.
- These loans are to be applied for through your local financial institution.
- There will be no fee to apply and no pre-payment penalties.
- Additionally, the document request list noted above may differ with each financial institution.
Our team at MNMW is working constantly to bring you the most recent news and updates related to the COVID-19 crisis that could impact you and your loved ones. In a continuing effort to maintain the health and safety of our valued clients, our team, and the community and to cooperate with the advice of health officials, MNMW lobbies in Fort Myers and Naples will be closed to the public until further notice.
For more information you can visit our MNMW Coronavirus (Covid-19) Resource page with the button below or call in at (239) 433-5554.