As a business owner who suffered financially due to the COVID-19 pandemic, you may be eligible to apply for the Paycheck Protection Program (PPP) loan. The PPP loan has a current budget of $350 billion dollars to provide loans to small business owners. With a PPP loan, you can receive up to 2.5 times the average amount of payroll for a maximum of $10 million dollars. You can use the proceeds to pay expenses such as employee salaries, other debt, rent, and utilities.
How to Qualify for PPP Loan Forgiveness
The Small Business Administration (SBA) recognizes that business owners are in this situation through no fault of their own. It wasn’t financial mismanagement but a worldwide pandemic that affected everyone. For this reason, it has established guidelines for PPP loan forgiveness. That means you have no obligation to repay the loan partially or fully if you meet certain requirements. You can begin to apply for loan forgiveness 24 weeks after receiving your funds from the SBA. Be sure to provide the SBA with the following information at that time:
- Details on how you used the proceeds for the PPP loan
- Data regarding your payroll such as whether it remained consistent or changed during the 24-week period
- Documentation to prove the above
The amount of PPP loan forgiveness you qualify for depends on several factors, including the classification of your business. Those eligible to apply include partnerships and sole proprietors with or without employees, LLLs, non-profits, or corporations with employees. The forgivable loan amount, eligible expenses, and documentation requirements vary considerably among these categories.
Schedule an Appointment to Learn More
We realize that PPP loan requirements can be complex. If you’re feeling overwhelmed, don’t hesitate to contact us to request an appointment with one of our loan advisors. We also welcome you to get in touch if you’re ready to submit an application to the SBA.