Last week, the CARES Act was signed and includes a new SBA 7(a) program called the Paycheck Protection Program (PPP) offering loans to help small businesses keep workers employed amid the pandemic and economic downturn.
The CARES Act SBA Paycheck Protection Program (PPP) loan will provide two and a half months of payroll through 100% federally guaranteed loans to small employers who meet the eligibility requirements due to the spread of COVID-19. The deadline to apply for the PPP loan program is June 30th, 2020.
While the SBA is finalizing the guidelines for the new PPP loan, SmartBiz Loans® is working non-stop to prepare for business owners to access these new loan applications as quickly as possible.
Be one of the first in the know new information about small business funding during this time. Sign up for our PPP application e-mail alerts here.
Information about PPP loans
The U.S. Chamber of Commerce has prepared a document with useful information about the program including eligibility, loan amounts, loan forgiveness, and more.
Important information includes:
- A small business with fewer than 500 employees (The 500-employee threshold includes all employees: full-time, part-time, and any other status).
- A small business that otherwise meets the SBA’s size standard
- A 501(c)(3) with fewer than 500 employees
- An individual who operates as a sole proprietor, an independent contractor, is self-employed and regularly carries on any trade or business
- A Tribal business concern that meets the SBA size standard
- A 501(c)(19) Veterans Organization that meets the SBA size standard
Some special rules may make you eligible and are also outlined in the document.
Additional information includes how to calculate payroll, loan forgiveness, and amounts available. Note that a personal guarantee is not required for a PPP loan. Collateral is also not required.
Access the Chamber of Commerce information sheet here.
In the Meantime
The federal government is currently finalizing the details and protocols about how and when different programs will be in place and we will update you ASAP. Sign up for our e-mail alerts here.
If you believe that you will qualify for relief from the CARES Act some documentation may be required when applying for a program when it becomes available. It may be helpful to gather the following information about your business:
- 2019 Payroll — Including the last 12 months of payroll
- 2019 Employees — 1099's for 2019 employees and independent contractors that would otherwise be an employee of your business. (Note: Do NOT include 1099's for services)
- Healthcare costs — All health insurance premiums paid by the business owner under a group health plan.
- Retirement — Your company retirement plan funding paid for by the company.
More details about the documentation needed to apply should be announced soon. We’ll keep you informed with up-to-date information when you sign up for our e-mail alerts.