Second round of relief

Earlier this month, the Small Business Administration’s Paycheck Protection Program (PPP) offered the first round of relief to small businesses under 500 employees by providing needed capital to cover payroll, utilities, rent, insurance, and loan payments (see PPP program description below). For businesses unable to take advantage of these loans in the first round, there is another opportunity!

Payroll Protection Program. The SBA’s Payroll Protection Program (PPP) is designed to help businesses maintain their workforce by enabling small businesses to cover payroll and other expenses for eight weeks during the COVID-19 crisis. The loans cover up to $10 million and may be used to pay employees, utilities, rent, insurance, and loans not receiving tax credits through the Families First Coronavirus Response Act. Please visit our COVID Resource Portal for the most current information.

SBA Portal Opens on Monday, April 27th at 10:30 AM EST!

An additional $310 billion of unrestricted funds are now available through the Paycheck Protection Program and Health Care Enhancement Act beginning on Monday, April 27th at 10:30 AM. The legislation provides $250 billion of unrestricted funds for the PPP and $60 billion reserved for small lending institutions ($30 billion for lenders with less than $10 million in assets and $30 billion for lenders with assets between $10 – $50 billion).

To take advantage of this second opportunity, collect the documents that you will need (see below) and be able to certify that your company has been harmed by the crisis and needs the PPP Loan to operate. 

For companies with employees: 

• 2019 Income Tax Return
  • Form 1065 with K-1s for partnerships
  • Form 1120 for C-Corps
  • Form 1120-S with K-1s for S-Corps
  • Form 990 for non-profits
• 2019 Tax Form 940 or 943 for Agriculture (only if filed)
• 2019 IRS Form 941 and PA quarterly wage unemployment insurance tax report forms
• 2019 Payroll processor records with gross salaries and wages
• 2020 Tax form 941
• Documentation for any health insurance or retirement contributions 

For sole proprietors or self-employed without employees:

• 2019 IRS 1040 Schedule C Form (if filed) OR 2019 Draft IRS 1040 Schedule C Form (if not filed)
• Profit & Loss Statement to show income and expenses
• Documentation establishing you were self-employed in 2019 and in operation on February 15, 2020.

For independent contractors: 

• 2019 Form 1099-MISC for services rendered

Note: If you are applying for both the PPP and EIDL, the optimal strategy is to use the PPP funds for payroll because that is forgivable and use the EIDL for anything that the PPP does not pay for. If there are PPP or EIDL funds remaining after expenses are paid, return the funds as payment of the loan.

If you would like clarification on the PPP or any other assistance program, please contact a CGA Law Firm attorney or visit the COVID-19 Business Resource Page on our website.

CGA’s latest blog posts.