Posted: April 4, 2020
The Paycheck Protection Program authorizes up to $349 billion in forgivable loans to
small businesses to pay their employees during the COVID-19 crisis. All loan terms will be the same for everyone.
The loan amounts will be forgiven as long as:
- The loan proceeds are used to cover payroll costs, and most mortgage interest, rent, and
utility costs over the eight-week period after the loan is made; and
- Employee and compensation levels are maintained.
Payroll costs are capped at $100,000 on an annualized basis for each employee. Due to likely high subscription, it is anticipated that not more than 25% of the forgiven amount may be for non-payroll costs. Loan payments will be deferred for six months.
Starting April 3, small businesses and sole proprietorships can apply for and
receive loans to cover their payroll and other certain expenses through existing Small Business Association lenders.
Starting April 10, independent contractors and self-employed individuals can apply for and receive loans to cover their payroll and other certain expenses through existing SBA lenders.
Other regulated lenders will be available to make these loans as soon as they are approved and enrolled in the program.