Though Paycheck Protection Program funds are still available to small businesses struggling amid economic hardships brought on by COVID-19, some borrowers and lenders are concerned about ambiguous terms of the loans.
In an effort to help answer small business owners’ questions about the Paycheck Protection Program and how the potentially forgivable loans could impact their business, the Small Business Administration (SBA) has released a Paycheck Protection Program FAQ guide.
Some questions clarified in the Paycheck Protection Program (PPP) guide include:
- Are small business concerns (as defined in section 3 of the Small Business Act, 15 U.S.C. 632) required to have 500 or fewer employees to be eligible borrowers in the PPP?
- The CARES Act excludes from the definition of payroll costs any employee compensation in excess of an annual salary of $100,000. Does that exclusion apply to all employee benefits of monetary value?
- Do PPP loans cover paid sick leave?
- My small business is a seasonal business whose activity increases from April to June. Considering activity from that period would be a more accurate reflection of my business’s operations. However, my small business was not fully ramped up on February 15, 2020. Am I still eligible?
- I need to request a loan to support my small business operations in light of current economic uncertainty. However, I pleaded guilty to a felony crime a very long time ago. Am I still eligible for the PPP?
- Should payments that an eligible borrower made to an independent contractor or sole proprietor be included in calculations of the eligible borrower’s payroll costs?