The $2.2 trillion coronavirus stimulus bill enacted by Congress on March 27 provides cash assistance to small businesses that keep their employees or recall employees they have furloughed or laid off due to financial hardships related to COVID-19. Small businesses as well as individuals who are self-employed or are independent contractors are eligible if they also meet program size standards.
Known as the Paycheck Protection Program, the loan program allows businesses with fewer than 500 employees to get immediate assistance with meeting operating expenses, with the prospect of not having to repay some or all of the loan.
The U.S. Treasury Department has posted documents related to the “Paycheck Protection Program” at https://home.treasury.gov/
- For a top-line overview of the program CLICK HERE
- If you’re a borrower, more information can be found HERE
- The application for borrowers can be found HERE
Highlights of the Paycheck Protection Program include:
- Loan Amount: may be 2.5 times your average monthly payroll costs limited to $10 million. 10-year loan with interest rate of < % 4.0. 1099 contractors are included in the calculation of "payroll costs."
- Loan Forgiveness: Amount of the loan used to pay for payroll, rent, utilities and mortgage interest from Feb. 15, 2020, through June 30, 2020, will be forgiven. The debt forgiven will not be considered taxable income.
- When: Administration officials have said that these loans should be available by this Friday, April 3, 2020.
- Where: Any FDIC insured back or federally insured credit union will be able to provide these loans. These will be SBA loans, but you will not need to go through the SBA to secure the loans. It is not clear yet which banks will be participating in these loans.
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