Paycheck Protection Program Loan Payroll Calculation: Your Payroll Processor Can Help

An important component of Paycheck Protection Program (PPP) loans that can be difficult for business owners to analyze is payroll calculation. This important number is used to determine your total PPP loan amount.

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Using payroll numbers to calculate your PPP loan amount

The maximum allowable loan amount is 2.5 times the average monthly payroll costs for the year prior to the loan date, up to a limit of $10,000,000. There are alternate calculation periods for seasonal employers and those not in business between February 15, 2019 and June 30, 2019.

In addition to wages, commission, cash tips and other compensation, the calculation of payroll costs includes health-care costs such as insurance premiums, state/local employer taxes, retirement benefits and other specified costs. However, this calculation excludes the prorated portion of annual wages over $100,000 per employee, as well as federal taxes, workers’ compensation premiums and certain other items.

More information is available from the US Treasury Department.

If you use a payroll provider, tools are available to help you more easily calculate your payroll costs. Here are popular software companies offering payroll calculation information.


ADP® payroll calculation guidelines

To help determine the maximum loan amount that your company can request, use the CARES SBA-PPP: Monthly Payroll Cost Report from ADP. This 6 page report has information about payroll costs and how they relate to the total PPP loan amount.

If you’re a current ADP customer, here’s how to access the report:

  • Login to RUN Powered by ADP®.
  • You will see a pop up, click learn more.
  • On the next screen, click Run my payroll report button.
  • On the next screen, confirm your dates and access your report.

Gusto® payroll calculation guidelines

Gusto has created a resource called the Paycheck Protection Program (PPP) report to help customers apply for a PPP loan.

If you’re a Gusto customer, you can access this report through both the COVID-19 and Reports tab of your Gusto account. If you’re not a customer, access the report here.

You’ll learn about calculations for seasonal businesses, newly formed businesses, and more. The report outlines CARES Act requirements and is updating with new information as the lending landscape evolves.



This small business supporter has updated their Paycheck Protection Program payroll data report in light of new PPP regulations. The new report removes employer social security and Medicare (FICA) from the final calculations, per the new guidance issued by SBA. The final calculations seen in the report are accurate per the guidance issued April 6, 2020.

For more information about how SurePayroll can help you with your PPP application calculations, visit their site here.



Paychex is staying on top of regulatory developments and has already begun the work to revise their PPP Data Report to implement new guidance.

In the meantime, if you want to apply for a PPP loan using the prior version of your Paychex PPP Data Report, you can simply take the Total line of the “Employer FICA Taxes” column, divide by the number of months (generally 12), and subtract it from your “Average Total Payroll Costs” to reasonably estimate your new monthly average payroll costs for the loan application.

Once the new version of the Paychex PPP Data Report is released, it will be available for all online Paychex Flex® users to download. If you use Paychex Flex, the new report will be available within the Quick Reports section of your dashboard.

For business owners not using Paychex, you can complete this form to be put in touch with a Service Specialist who can assist you.


Mazars Tool

If you don’t use a payroll processor, Mazars USA LLP, a national accounting, tax, and consulting firm, announced in April that they have launched a tool to help small businesses calculate the amount they are eligible to receive from the PPP. This tool is available for small businesses, CFOs, and accounting firms to help them navigate the complex program, increasing the speed of the application process.

The Marzars tool was created to help:

  • Accurately calculate your potential PPP loan amount
  • Accurately calculate the 8-week loan forgiveness with the ability to calculate multiple scenarios
  • Accurately calculate loan forgiveness
  • Make better business decisions to aide with short term business objectives
  • Understand the patterns and the effects of the loan amortization and the amount of loan coverage for a 2-year period

The tool, which is available for a one-time purchase, can be downloaded here. For questions about the PPP or the PPP Analysis Tool from Marzars, please contact

If you aren’t currently using a payroll processor but might in the future, check out user reviews on Capterra® to help you make the best decision for your unique business: Best Payroll Software for Small Business.

Are tax documents needed?

In addition to payroll costs, banks may also ask prospective small business borrowers for proof the business was operating as of Feb. 15, tax forms for workers from 2019, and documentation regarding health insurance premiums they pay, among other things. This can vary by lenders so be sure to check the specific guidelines.

Tax transcripts may be requested by submitting an IRS Form 4506-T to the Internal Revenue Service in order to obtain federal income tax information on borrowers for the last 3 years.  For quicker responses, the Internal Revenue Service (IRS) has implemented the Income Verification Express Service (IVES) program which is an expedited service that lenders can use to confirm the income of a borrower during the processing of a loan application. Under IVES, the IRS can electronically provide tax return transcript generally within two business days to a third party with the consent of the taxpayer. More information on how to obtain access to and utilize the IVES system can be found at:

Additional resources