Paycheck Protection Program FAQs

Who is eligible for SBA Paycheck Protection Program Loan?

Small businesses, 501(c)(3) nonprofit, a 501(c)(19) veteran’s organization, or Tribal business concern described in section 31(b)(2)(C) of the Small Business Act with not more than 500 employees, or the applicable size standard for the industry as provided by SBA, if higher.

Sole-proprietors, independent contractors, and other self-employed individuals are eligible for loans.

What can I use the loan funds for?

  • Payroll costs – this includes salaries, certain employee benefits, state and local taxes. Payroll costs are capped at $100,000 on an annualized basis for each employee. Seasonal employees and businesses in operation for less that a year are subject to a different calculation.
  • For a sole proprietor or independent contractor: wages, commissions, income, or net earnings from self-employment, capped at $100,000 on an annualized basis for each employee.
  • Group healthcare benefits.
  • Insurance premiums.

What is the interest rate on this loan?

The interest is 1%

How much can I borrow?

The monthly average of your annual payroll (minus the employees who through salary, bonus and/or commission make $100,000 and higher) * 2.5.

For example: Annual payroll is $1,200,000 (all employees <$100,000). Monthly average is $100,000. Loan Amount equals $100,000 * 2.5 = $250,000

What document do I need to verify payroll at my company?

Accepted documents to verify payroll include:

  • IRS Form 940 and 941
  • If a Payroll Summary Report is not available, Employee Pay Stubs as of February 15, 2020 (or corresponding period) with a corresponding bank statement
  • 2019 W3
  • 2019 Personal Tax Return
  • Third-party payroll processing documents

How can my business receive loan forgiveness?

You will need to provide proof of payment of the following:

  • Breakdown of payroll benefits (vacation, allowance for dismissal, group healthcare benefits, retirement benefits, etc.
  • Most recent Mortgage Statement or Rent Statement (Lease)
  • Most recent Utility Bills (Electric, Gas, Telephone, Internet, Water)