Information
and developments are flying fast these days. With the recent passing of the
Coronavirus Aid, Relief, and Economic Security Act (CARES), another SBA program
has been made available for businesses to gain much needed access to working
capital.
The Paycheck
Protection Program, part of the CARES Act, provides a path for businesses,
through a participating SBA Lender/Bank, to be able to apply for funds as
defined in the program. The loan window will open up on Friday, April 3, 2020. It is advised to wait until your bank sends the application as those applications may be adjusted right through the last minute. The basic
elements of the program are:
·
Must
have 500 or fewer employees (beware of aggregation rules)
·
Maximum
Loan will be $10 million
·
The
loan can be forgiven if used for:
o
Payroll
costs
o
Rent
o
Utilities
o
Mortgage/Existing
Debt as defined
o
Other
designated costs
o
Due
to high subscription expectation, not more than 25% of loan forgiveness can be
for non-payroll costs
·
Provisions
for employee retention as defined. Caps
re: highly compensated employees
·
Debt
forgiven will NOT be included as taxable income for federal tax purposes
The links below are official US Department of Treasury links (they are safe).
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