Benefits of an SBA-Backed Paycheck Protection Program Loan

What Is the Paycheck Protection Program?

As a part of the $2.2 trillion federal stimulus package, the new Paycheck Protection Program provides small business loans with up to 100% forgiveness to help businesses impacted by COVID–19. The objective of this program is to help businesses retain their workforce and assist with operational expenses. These loans are meant to help you cover employee salaries, total payroll support, rent, utilities, and other business related debt-obligations.

 

Is Your Small Business Eligible for the Program?

All businesses that were in operation before February 15, 2020 – including nonprofits, sole proprietorships, self–employed individuals, and independent contractors – with 500 or fewer employees can apply. Businesses in certain industries can have more than 500 employees if they meet applicable SBA employee-based size standards for those industries (click HERE for additional detail).

 

How is the loan amount determined?

Your loan amount will be 250% (or 2.5 times) your average monthly payroll, capped at $500,000. Your monthly payroll includes wages, tips, group health, retirement benefits, and taxes. For purposes of calculating “Average Monthly Payroll”, most Applicants will use the average monthly payroll for 2019, excluding costs over $100,000 on an annualized basis for each employee. For seasonal businesses, the Applicant may elect to instead use average monthly payroll for the time period between February 15, 2019 and June 30, 2019, excluding costs over $100,000 on an annualized basis for each employee. For new businesses, average monthly payroll may be calculated using the time period from January 1, 2020 to February 29, 2020, excluding costs over $100,000 on an annualized basis for each employee.

Need Accounting Help?

Let our tax professional assist you in bringing your books up to date and preparing your tax return.

CALL DENNY EBERHART TODAY FOR A FREE CONSULTATION!

(610) 927-5175

Email: deberhart0309@gmail.com

Accounting, Bookkeeping & More!

We provide clients with a wide range of services to individuals and businesses in a variety of industries. We strive to meet each client's specific needs in planning for the future and achieving their goals in an ever-changing environment.