Paycheck Protection Program (PPP) Loans
The Paycheck Protection Program – part of the CARES Act – is designed to provide low-interest loans to small businesses across sectors and regions to help sustain workforce. These loans may be forgiven if used for payroll or other qualified expenses.
Who is eligible?
Small businesses with fewer than 500 employees, as well as select businesses with fewer than 1,500 employees, 501(c)(3) non-profits, some 501(c)(19) veteran organizations, and self-employed, sole proprietors, and freelance workers are eligible to apply for funds. Read more here for eligibility of partners, contract and other freelance workers.
How much will the loan be?
A PPP loan can be drawn up to the lesser of 2.5 times average monthly payroll or $10 million. Interest rates are capped at 4%, and no personal guarantee or collateral is required for the loan. Read more here about how to calculate your loan amount and potential forgiveness.
Can the loan be forgiven?
Loans may also be forgiven based on eligible expenses during the 8-week period following the date the loan is funded. Forgivable expenses include payroll cost (capped at $100,000 annualized salary), retirement and group health care benefits, mortgage interest, rent and most utilities.
Loan forgiveness is dependent on continuing to pay employees and maintaining employee count of at least 75% during the eight weeks following the origination of the loan.
How do I apply?
We recommend all parties reach out their bankers to understand the status of a current loan or to prepare for a future one. Additionally, please contact your M&S advisor today to determine next steps. For additional information on what to prepare for your loan application, please read on here.