Our April 2nd "to do" list included a summary of our guide on the Payroll Protection Program (PPP) loan and the amended Economic Injury and Disaster Relief Loan offered by the SBA.
We now have updated information as the SBA issued interim regulations, providing additional guidance on the Paycheck Protection Program (PPP).
Notable items from the initial guidance related to the PPP from the interim regulations were as follows:
- The interest rate on PPP loans will be 1% instead of .5%.
- The PPP loan term was confirmed to be only two years.
- The interim guidance clarified that not more than 25% of the forgiveness part of the loan may be attributable to non-payroll costs. For example, if you use only 50% of the proceeds of the PPP loan for payroll and 50% for rent and utilities, only 75% of the PPP loan will be forgiven (25% that you spent on non-payroll costs and 50% that you spent on payroll). The rest of the PPP loan 25% must be repaid in this example.
- A revised application form for PPP loans was published.
Click here to read the full text of the Interim Regulations.
For more resources and LP's response to COVID-19, visit this webpage.