–SBA Administrator Jovita Carranza and U.S. Treasury Secretary Steven T. Mnuchin issued
the following statement today following the enactment of the Paycheck Protection Program (PPP) Flexibility Act:
to thank President Trump for his leadership and commend Leader
McConnell, Leader Schumer, Speaker Pelosi, and Leader McCarthy for
working on a bipartisan basis
to pass this legislation for small businesses participating in the
Paycheck Protection Program.
also want to express our gratitude to Chairman Rubio, Ranking Member
Cardin, Senator Collins, Congressman Roy, Congressman Phillips, and
other members of Congress who
have helped to create and guide our implementation of this critical
program that has provided over 4.5 million small business loans totaling
more than $500 billion to ensure that approximately 50 million
hardworking Americans stay connected to their jobs.
bill will provide businesses with more time and flexibility to keep
their employees on the payroll and ensure their continued operations as
we safely reopen our
“We look forward to getting the American people back to work as quickly as possible.”
in consultation with Treasury, will promptly issue rules and guidance, a
modified borrower application form, and a modified loan
forgiveness application implementing these legislative
amendments to the PPP. These modifications will implement the
following important changes:
the covered period for loan forgiveness from eight weeks after the date
of loan disbursement to
24 weeks after the date of loan disbursement, providing substantially
greater flexibility for borrowers to qualify for loan
forgiveness. Borrowers who have already received PPP loans retain the
option to use an eight-week covered period.
Lower the requirements that 75 percent of a borrower’s loan proceeds must be used for payroll costs and that 75 percent of the loan forgiveness amount must have been spent on payroll costs during the 24-week loan forgiveness covered period to 60 percent for each of these requirements. If a borrower uses less than 60 percent of the loan amount for payroll costs during the forgiveness covered period, the borrower will continue to be eligible for partial loan forgiveness, subject to at least 60 percent of the loan forgiveness amount having been used for payroll costs.
a safe harbor from reductions in loan forgiveness based on reductions
in full-time equivalent employees for borrowers that are unable to
return to the same level
of business activity the business was operating at before February 15,
2020, due to compliance with requirements or guidance issued between
March 1, 2020 and December 31, 2020 by the Secretary of Health and Human
Services, the Director of the Centers for Disease
Control and Prevention, or the Occupational Safety and Health
Administration, related to worker or customer safety requirements related to COVID–19.
Provide a safe harbor from reductions in loan forgiveness based on reductions in full-time equivalent employees, to provide protections for borrowers that
are both unable to rehire individuals who were employees of the
borrower on February 15, 2020, and unable to hire similarly qualified
employees for unfilled positions by December 31, 2020.
five years the maturity of PPP loans that are approved by SBA (based on
the date SBA assigns a loan number) on or after June 5, 2020.
the deferral period for borrower payments of principal, interest, and
fees on PPP loans to the date that SBA remits the borrower’s
loan forgiveness amount to the
lender (or, if the borrower does not apply for loan
forgiveness, 10 months after the end of the borrower’s loan forgiveness covered period).
addition, the new rules will confirm that June 30, 2020, remains the
last date on which a PPP loan application can be approved.
Question: How will SBA review borrowers’ required good-faith certification concerning the necessity of their loan request?
Answer: When submitting a PPP application, all borrowers must certify in good faith that “[c]urrent economic uncertainty makes this loan request necessary to support the ongoing operations of the Applicant.” SBA, in consultation with the Department of the Treasury, has determined that the following safe harbor will apply to SBA’s review of PPP loans with respect to this issue: Any borrower that, together with its affiliates, received PPP loans with an original principal amount of less than $2 million will be deemed to have made the required certification concerning the necessity of the loan request in good faith.
SBA has determined that this safe harbor is appropriate because borrowers with loans below this threshold are generally less likely to have had access to adequate sources of liquidity in the current economic environment than borrowers that obtained larger loans. This safe harbor will also promote economic certainty as PPP borrowers with more limited resources endeavor to retain and rehire employees. In addition, given the large volume of PPP loans, this approach will enable SBA to conserve its finite audit resources and focus its reviews on larger loans, where the compliance effort may yield higher returns.
Importantly, borrowers with loans greater than $2 million that do not satisfy this safe harbor may still have an adequate basis for making the required good-faith certification, based on their individual circumstances in light of the language of the certification and SBA guidance. SBA has previously stated that all PPP loans in excess of $2 million, and other PPP loans as appropriate, will be subject to review by SBA for compliance with program requirements set forth in the PPP Interim Final Rules and in the Borrower Application Form. If SBA determines in the course of its review that a borrower lacked an adequate basis for the required certification concerning the necessity of the loan request, SBA will seek repayment of the outstanding PPP loan balance and will inform the lender that the borrower is not eligible for loan forgiveness. If the borrower repays the loan after receiving notification from SBA, SBA will not pursue administrative enforcement or referrals to other agencies based on its determination with respect to the certification concerning necessity of the loan request. SBA’s determination concerning the certification regarding the necessity of the loan request will not affect SBA’s loan guarantee.
Jeffrey W. King, the legal counsel for the World Floor Covering Association, clarified the meaning in this FAQ.
He said, “The SBA issued new Frequent Asked Questions (FAQs) today, which are designed to provide guidance on the PPP loan. The new FAQs include the quoted language in the email. This does not mean a PPP loan under $2 million will automatically be forgiven. Rather, the borrower must still meet the three requirements (75% on payroll costs, same average number of FTEs, and same pay within 25%).
“This new FAQ (No# 46) addresses the requirement that the borrower certify that the ‘[c]urrent economic uncertainty makes this loan request necessary to support the ongoing operations of the Applicant,'” he said. “The SBA has previously provided (FAQ item # 31) that to satisfy this certification, a borrower had to show that it did not have the ‘ability to access other sources of liquidity sufficient to support their ongoing operations in a manner that is not significantly detrimental to the business.’ If a borrower cannot meet that requirement, it must pay back the full loan amount must be paid back with none of it forgiven. The new FAQ #46 means that for loans under $2 million the certification will be deemed to be made in good faith and these smaller borrowers will not have to show it did not have access to other funds such as a line of credit.
“The SBA has previously announced that all PPP loans of $2 million or more will automatically be audited, including proof that it needed the loan and did not have ‘other sources of liquidity,’” he concluded. “Loans under $2 million will be subject random audits to prove how they spent the load proceeds and whether they can show they met the three standards to have the loan forgiven. Under the new FQA, they will not have to show they had access to other funds. “
As contractors begin to open or return to staffing at pre-pandemic levels, they may find employees are resisting coming back to work. According to a recent study, 54% of U.S. employees are worried about exposure to COVID-19 at their job. In addition, with the extra $600 that an employee can collect under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, an employee can collect $1,000 a week or more of unemployment benefits. This may be more than their regular pay, adding another disincentive to returning to the job.
Unfortunately, employees refusing to come back to work can impact the
amount of a Payroll Protection Program (“PPP”) loan that is forgiven. To
maximize the amount of the loan forgiven, the employer must meet three
75% of the PPP loan must be used on payroll costs;
Each employee’s pay during the 8 weeks must not be reduced by more than 25% of the employee’s pay during the most recent full quarter during which the employee was employed; and
The average number of full-time employee equivalents paid during the 8-week must be the same as the average number of full-time employee equivalents paid between February 15, 2019 and June 30, 2019 OR January 1, 2020 and February 29, 2020. The employer gets to choose the comparison period. If you pay fewer employees during the 8-week period, the amount forgiven will be proportionately reduced. To determine the number of full-time employee equivalents you include part timers based on the amount they worked (e.g., five part-timer employees working one 8-hour shift a day equals one full-time employee).
This week the Small Business
Administration (“SBA”) issued new guidance that addressed this issue. The SBA
stated that it will exclude “laid-off employees whom the borrower offered to
rehire (for the same salary/wages and same number of hours) from the CARES Act’s
loan forgiveness reduction calculation.” To have these employees excluded, the
employer must make “a good faith, written offer of rehire, and the employee’s
rejection of that offer must be documented.” To document the refusal, an
employer can send an email to the employee verifying their rejection of the rehire
offer. Be sure to put both the written offer and the email confirming the rejection
in the employees file; they will be needed when applying to have the PPP loan
It is unclear how this exclusion
will be applied. It appears that the calculations in item 2 (maintaining each
employee’s pay level) and item 3 (comparing the number of employees) will not
be applied in determining the amount of the loan to be forgiven for employees
that refuse to return to work. It is not clear, however, if and how it will
apply the 75% rule in item 1. Based on the primary purpose of the PPP loans—to
maintain payroll—it is likely that 75% of the loan will still have to be used
on payroll costs, whether or not there are the same number of employees.
With the rapid pace at which laws, rules and orders are being issued, NTCA
is working to keep members informed and updated regarding their opportunities
and obligations during the COVID-19 crisis. The Association will also continue
to provide important information that may impact members.
information contained in this update is abridged from legislation, court
decisions, and administrative rulings, and should not be construed as legal
advice or opinion, and is not a substitute for the advice of counsel.
On April 23, 2020, the Treasury Department, in collaboration with the Small Business Administration (the “SBA”), released guidance in the form of Frequently Asked Questions (FAQ). The potentially most significant aspect of the FAQ’s is the warning that businesses applying for, or receiving, Paycheck Protection Program (“PPP”) loans should carefully analyze whether their “[c]urrent economic uncertainty makes this loan request necessary to support the ongoing operations” of the business, as required under the CARES Act.
The new guidance states that: “In addition to reviewing applicable affiliation rules to determine eligibility, all borrowers must assess their economic need for a PPP loan under the standard established by the CARES Act and the PPP regulations at the time of the loan application. Although the CARES Act suspends the ordinary requirement that borrowers must be unable to obtain credit elsewhere … borrowers still must certify in good faith that their PPP loan request is necessary. Specifically, before submitting a PPP application, all borrowers should review carefully the required certification that ‘[c]urrent economic uncertainty makes this loan request necessary to support the ongoing operations of the Applicant.’ Borrowers must make this certification in good faith, taking into account their current business activity and their ability to access other sources of liquidity sufficient to support their ongoing operations in a manner that is not significantly detrimental to the business. For example, it is unlikely that a public company with substantial market value and access to capital markets will be able to make the required certification in good faith, and such a company should be prepared to demonstrate to SBA, upon request, the basis for its certification.Lenders may rely on a borrower’s certification regarding the necessity of the loan request. Any borrower that applied for a PPP loan prior to the issuance of this guidance and repays the loan in full by May 7, 2020, will be deemed by the SBA to have made the required certification in good faith.”
On April 24, 2020, President Trump signed legislation that pumped an additional $310 billion into the PPP after the $349 billion originally allocated to the program was exhausted within two weeks of the start of the PPP. The program has received heavy criticism after many eligible small businesses were unable to receive loans before the initial PPP funds were drained, particularly after news circulated that many publicly-traded companies and other non-traditional small businesses successfully received PPP loans. In some instances, businesses have returned their PPP loans after receiving criticism and pressure from the public.
Consequently, in this most recent guidance, the Treasury Department and SBA are advising all PPP loan applicants to carefully consider the certifications being made on their PPP loan applications, particularly whether “current economic uncertainty makes this loan request necessary to support the ongoing operations” of the business.Companies that have either already submitted applications or received PPP loans have until May 7, 2020, to determine whether they indeed meet the certifications made on their PPP applications. If any such business determines that it does not meet all of the certifications set forth on its PPP application, it may return its PPP loan by May 7, 2020, and avoid liability for not meeting such certifications.
The FAQ’s also reiterate prior guidance that payments to independent contractors and sole proprietors are not to be included in the calculation of payroll.Please see the FAQ’s, which can be found HERE, as well as our WEBSITE for further detail on these and other issues.
This situation is continuing to evolve. Fox Swibel will continue to monitor developments and stands ready to advise clients in connection with financing available to businesses and non-profits. If you have questions about qualifying for or applying for emergency funding, please contact Rick Meller, David Morris, Sean Snider, Xiang Siow or the Fox Swibel attorney with whom you regularly work.
This article contains material of general interest and should not be construed as legal advice or a legal opinion on any specific facts or circumstances. Under applicable rules of professional conduct, this content may be regarded as attorney advertising.
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WASHINGTON – Administrator of the U.S. Small Business Administration Jovita Carranza and U.S. Treasury Secretary Steven T. Mnuchin issued the following statement today on the resumption of the Paycheck Protection Program (PPP):
are pleased that President Trump has signed into law the Paycheck
Protection Program and Health Care Enhancement Act, which provides
critical additional funding for American workers and small businesses
affected by the coronavirus pandemic. We want to thank Leader
McConnell, Leader Schumer, Speaker Pelosi, and Leader McCarthy for
working with us on a bipartisan basis to ensure that the Paycheck
Protection Program is funded so that small businesses can keep
hardworking Americans on the payroll.
Business Administration will resume accepting PPP loan applications on
Monday, April 27 at 10:30AM EDT from approved lenders on behalf of any
eligible borrower. This will ensure that SBA has properly coded the
system to account for changes made by the legislation.
PPP has supported more than 1.66 million small businesses and protected
over 30 million jobs for hardworking Americans. With the additional
funds appropriated by Congress, tens of millions of additional workers
will benefit from this critical relief.
encourage all approved lenders to process loan applications previously
submitted by eligible borrowers and disburse funds expeditiously. All
eligible borrowers who need these funds should work with an
approved lender to apply. Borrowers should carefully review PPP
regulations and guidance and the certifications required to obtain a
Trump Administration is fully committed to ensuring that America’s
workers and small businesses continue to get the resources they need to
get through this challenging time.”
Whether or not a tile or flooring retailer, contractor, or installer was able to secure a Payroll Protection Plan (PPP) loan, they are likely to need additional financial support. Even a PPP loan covers only 8 weeks of payroll and part of a business’s other expenses. There are a variety of other options including Small Business Act (SBA) Economic Injury Disaster Loans (EIDL), SBA Emergency EIDL grants, and the SBA Express Bridge Loan Pilot Program. In addition, states and local cities and counties are offering a variety of loan and grant programs. To check out whether there are programs in you location, go to https://www.zenefits.com/workest/the-big-list-of-covid-19-financial-assistance-programs-for-small-businesses-by-state/.
The Federal Reserve recently announced another option for businesses; its highly anticipated Main Street Lending Program (Program). This Program is designed to facilitate credit to small and mid-sized businesses that were in good financial standing before the COVID-19 crisis. The Program offers 4-year loans to companies employing up to 10,000 workers or with revenues of less than $2.5 billion. Principal and interest payments on these loans will be deferred for one year. Firms that have taken advantage of the PPP are also eligible to take out Main Street loans.
Businesses seeking loans under either facility must commit to, among other things:
Make reasonable efforts to maintain payroll and retain workers.
Follow compensation, stock repurchase, and dividend restrictions that apply to direct loan programs under the CARES Act.
Not seek to cancel or reduce any of its outstanding lines of credit with the lender, or any lender.
Eligible banks may originate new Main Street loans or use Main Street loans to increase the size of existing loans to businesses.
With the rapid pace at which laws, rules and orders are being issued, NTCA is working with other associations to keep members informed and updated regarding their opportunities and obligations during the COVID-19 crisis. The association will also continue to provide important information that may impact members. Go to the website at www.tile-assn.com for the most up to date information on the COVID-19 crisis.
Notice: The information contained in this article is abridged from legislation, court decisions, and administrative rulings and should not be construed as legal advice or opinion,and is not a substitute for the advice of counsel.
By now, you’ve surely heard about the CARES
Act and the multitude of programs designed to help small businesses head off
economic crisis as a result of the Coronavirus pandemic.
Though new legislation and relief packages
have been signed into law, the aid they provide is not instantaneous. Like
anything else in life, there is a process. And because this is new ground for
many businesses – and lenders (not to mention the government armature that has
to be put in place to support all these changes), there can be delays and
This story is derived mainly from the Small Business
Administration resource at www.sba.gov, with some insight from tile contractors and
law firms. It’s a simplification of the more detailed information you can find at
the website to give you an idea of what these loans are, who they are meant
for, how they help, and how to access them.
A private non-profit organization that is a non-governmental agency or entity that currently has an effective ruling letter from the IRS granting tax exemption under sections 501(c),(d), or (e) of the Internal Revenue Code of 1954, or satisfactory evidence from the State that the non-revenue producing organization or entity is a non-profit one organized or doing business under State law, or a faith-based organization.
Be aware that this loan is capped at $1,000 per employee.
How long will it take me to fill out an application? 2 hours 10 minutes
How soon can I obtain funds? Claims are 3 days, but it
is so new, very little information is available as to how long it actually
takes to obtain funds.
How long do I have to apply? September 30, 2020
Is this loan forgivable? This loan advance will not
need to be repaid.
Paycheck Protection Program
Where can I find it? https://www.sba.gov/funding-programs/loans/coronavirus-relief-options/paycheck-protection-program-ppp
What does it do? This SBA loan helps
businesses keep their workforce employed for eight weeks during the Coronavirus
Any small business with fewer than
500 employees (including sole proprietorships, independent contractors and
self-employed persons), 501(c)(3) non-profit organizations, 501(c)(19) veterans
organizations, or Tribal businesses (see sec. 31(b)(2)(C) of the Small Business
Act) affected by Coronavirus/COVID-19.
certain industries may have more than 500 employees if they meet the SBA’s size
standards for those industries.
in the hospitality and food industry with more than one location could also be
eligible if their individual locations employ fewer than 500 workers.
Where do I
For best results, check with your local lender first. Any SBA 7(a) lender, or any federally-insured depository institution, federally-insured credit union, and Farm Credit System institution that is participating can service this loan. Other regulated lenders will be available to make these loans once they are approved and enrolled in the program.
You can start preparing the application you will submit to your lender by using the application form at https://www.sba.gov/document/sba-form–paycheck-protection-program-borrower-application-form.
How long do I
have to apply? Lenders may begin
processing loan applications as soon as April 3, 2020. The Paycheck Protection
Program will be available through June 30, 2020, but due to finite funds, it’s
best to apply as soon as possible. Independent contractors and self-employed individuals can apply starting
How soon can I obtain funds? Anywhere from 10 – 30 days.
Is this loan
forgivable? SBA will fully forgive
loans if all employees are kept on the payroll for eight weeks and the money is
used for payroll, rent, mortgage interest, or utilities. At least 75% of the
loan must be used for payroll. Loan payments will also be deferred for six
months. No collateral or personal guarantees are required. Neither the
government nor lenders will charge small businesses any fees.
Forgiveness is based on the employer
maintaining or quickly rehiring employees and maintaining salary levels.
Forgiveness will be reduced if full-time headcount declines, or if
salaries and wages decrease.
What is the maturity and interest rate
of the loan? This loan has a maturity of 2 years and an interest rate of 1%.
Additional loans you may want to consider include:
SBA Express Bridge Loan
What does it do? It enables small businesses that currently have a business relationship with an SBA Express Lender to access up to $25,000 quickly.
Why might I need it? It can help overcome temporary loss of revenue small businesses are experiencing or it can satisfy the need for urgent cash while applying for a direct SBA Economic Injury Disaster Loan.
Is it forgivable? It will be repaid in full or in part by proceeds from the EIDL.
SBA Debt Relief
What is it? A financial reprieve to small businesses
during the COVID-19 crisis
does it do?
The SBA will automatically pay the principal, interest, and fees of current 7(a), 504, and microloans for a period of six months.
The SBA will also automatically pay the principal, interest, and fees of new 7(a), 504, and microloans issued prior to September 27, 2020.
Automatic payment deferment
What is it? SBA is providing automatic payment deferments through December 31, 2020 for current SBA Serviced Disaster (Home and Business) Loans if they were in regular servicing status on March 1, 2020.
How do automatic deferments benefit me? Though interest will continue to accrue on the loan, monthly payment notices will reflect the loan is deferred and no payment is due.
about automatic debit payments on the loan?
The deferment will not cancel any
established Preauthorized Debit (PAD) or recurring payments on the loan.
Borrowers that have established a PAD
through Pay.Gov or an OnLine Bill Pay Service must cancel these recurring
payments. Borrowers that had SBA establish a PAD through Pay.gov must
contact their SBA servicing office to cancel the PAD.
What if I want to keep paying on the loan? If you wish to
continue making payments during the deferment period, you may and they will be
applied normally. Once the automatic deferment period ends, borrowers will need
to resume their regular payment schedule, and those who cancelled recurring
payments will need to reestablish them.
do I go for questions? Please contact
your Loan Servicing Office directly using the following information:
Stay tuned for ongoing information about programs that can benefit small
businesses and workers as we move through this pandemic together. And visit www.tile-assn.com for regularly updated
resources to help businesses and workers affected by COVID-19.
An NTCA perspective on
the CARES Act for companies with fewer than 500 employees
NTCA has been reviewing details as relates to new legislation enacted as a response to the COVID-19 crisis, and how it impacts our members and the tile industry at large.
This piece is an NTCA perspective on the Paycheck Protection
Program aspect of the CARES Act and how members and small businesses can best
take advantage of what is currently being offered by the government. Keep in
mind that even though legislation has been passed, some details continue to
change, and lenders are struggling to meet all the demand suddenly flooding in
for loans. Your experience in applying for loans and the amount of time it
takes you to receive funds may vary.
The CARES Act is over 830 pages long and has 16 laws
attached to it. The main item we want to
focus on involves the Paycheck Protection Program (PPP), which helps businesses
keep their workforce employed for eight weeks during the Coronavirus outbreak.
This is also a
potentially forgivable loan if you follow the guidelines. The SBA stipulates
that at least 75% of the PPP loan must be used for payroll. Forgiveness is
based on the employer maintaining or quickly rehiring employees and maintaining
salary levels. Forgiveness will be reduced if full-time headcount
declines, or if salaries and wages decrease.
The following steps can help you know what to expect as you
navigate through the labyrinth of applying for a loan, obtain funds, and
qualify for the forgivable loan status. This latter point is doubly important
since loans that are forgiven – or portions of loans that are forgiven — are
not counted as taxable income.
Call Your Bank
Ensure your bank is FDIC-insured and is approved to handle SBA loans and is able to handle PPP application.
There is only $350 billion available in the PPP coffers so get your application in as quickly as possible.
This is a fluid situation. The banks are on the front lines and are trying to navigate uncharted waters.
Most banks are only working with customers they currently do business with. This is because there is a limited amount of money and they want to take care of their customers first.
Once applications are submitted, they are assembled into a queue for the banks to sort out. This could take up to 10 days. Once submitted for approval, it could take up to 30 days for the funds to be deposited into your account.
You can access a fact sheet on PPP loan application form and get a downloadable form that may or may not be accepted by your lender. The advantage of accessing this form is that it will help you compile the information you need whether you use the SBA or lender form.
The program application process is open to June 30. Due to limited funds, it is to your benefit to start this process as soon as possible.
April 3rd was the date that many banks opened application process for small businesses.
April 10th is the date that independent contractors and self-employed individuals can apply.
Check your company governance requirements and other lending commitments to ensure there is not a problem in applying for this loan
The SBA form requires all owners with 20% stake or more in the company to answer questions on the loan (examples include bankruptcy, have they ever been barred or declared ineligible by any federal department or agency, have they been convicted of a felony, etc.)
Calculate your payroll expenses
To qualify for forgivable loan status, the amount you can borrow is 2.5 times your average monthly payroll from the previous year (2019).
Payroll costs include salaries, wages, commission, tips, vacation, PTO, health care benefits, retirement benefits, state and local taxes. Payroll costs in the loan calculation do not include federal taxes.
There is a cap on payroll for an employee making over $100,000 in 2019. You can only claim $100,000. That is salary; benefits are not counted. For example, an employee made $140,000, but you would only claim $100,000 when you calculate your payroll for the loan.
How much are you eligible for? Add average total monthly payroll and divide by 12. Then multiply by 2.5.
If you already applied for or were awarded an SBA Disaster Loan, you can add that amount to the PPP application. Note that the PPP loan has restrictions on how you spend the money.
SBA Disaster Loans allow more freedom with how you use the loan money, but may not be forgivable, are subject to underwriting, and require personal guarantees attached to it. Visit sba.gov for details.
Document and keep excellent records of paperwork used in your application
Print and electronically store your records and have them available for submission if the bank requires these material or if the federal government later checks for fraud or misuse.
Sign a certificate
All owners with 20% stake will be asked to sign a statement certifying the funds are necessary and will be used for what the loan stipulates: to maintain or to hire staff back that was let go after February 15th, 2020.
No collateral or personal guarantees will be required for these funds.
This loan has a maturity of 2 years and an interest rate of 1% should it need to be paid back. However, funds should be forgivable if you document your paperwork, keep honest and thorough records, and use the money for what the PPP is designed for within the 8-week time frame.
Make sure you use the funds for authorized purposes
75% needs to be used for payroll which includes costs related to group health care benefits and insurance
Payments of interest but not principal on any mortgage obligation
Rent (including rend or lease agreements)
Interest on any other debt like equipment, vehicles, etc.
Keep funds segregated into a designated account and use the funds to document a paper trail for the authorized uses listed above.
Understand the impact of your past and possible future firings or layoffs of employees, or reduction or furloughs in their salaries.
The PPP is designed to encourage employee retention and discourage layoffs and wage cuts. If you need to do massive amounts of layoffs or cuts, reconsider applying for PPP and investigate a different loan option at sba.gov.
Talk to your accountant and lawyer about other tax credits or employee retention credits that may be available apart from the PPP loan.
Keep up to date on changes or interpretations to the law.
This is a very fluid situation, and things can change.
Get legal and accounting advice and establish communication with your banker.
We will continue to post salient articles on legislation topics here. Also be sure to visit the Coronavirus Resource Page at tile-assn.com for links and ongoing information, designed to support you and your business.