Paycheck Protection Program – What You Need to Know
The Paycheck Protection Program (PPP) is a federal relief program managed by the Small Business Administration (SBA). The program is designed to help small businesses keep their workforce employed during the COVID pandemic. The financial assistance is structured as a loan, to be forgiven if all employees are kept on the payroll for eight weeks, and the funds are used primarily for payroll. Up to one quarter of the loan can be used toward rent, mortgage interest or utilities within specific parameters.
The initial $349 billion commitment ran out in roughly two weeks, without meeting the total funding needs of small businesses. On Tuesday, April 21, the Senate approved an additional $310 billion in PPP funding. The bill is widely expected to be signed into law later this week. Some of the regulations pertaining to the program can be complicated so you should contact your local lending institution or refer to the SBA website. But here are some key points about the PPP that you should know:
If I submitted an application for the first round of funding, do I need to re-apply?
In general, no. Most lenders have held on these applications and many have continued to process them, in anticipation of a second round of funding. However, you should follow up with your financial institution directly to find out about your particular circumstances.
How do I apply?
If you have been impacted by COVID-19, you can apply through any SBA lender or through any participating federally insured depository institution, federally insured credit union, or Farm Credit Institution.
How do I know if I am eligible to apply?
All businesses with 500 or fewer employees can apply.
Businesses in certain industries can have more than 500 employees can apply if they meet certain SBA criteria.
A Taxpayer Identification Number (TIN ) is required.
How much money can I get?
The loan amount is based on your company’s average monthly payroll costs for the prior year, up to a maximum loan amount of $10 million.
How long do I have to apply?
The program is open until June 30, although the Treasury Department encourages you to apply as quickly as possible.
Be certain to review the US Treasury Department’s Information Sheet for more detailed information on this program. Also, our personal injury attorneys are on your service if you have any other questions.
Share this post: