Updates on the Paycheck Protection Program (PPP) and guidance on the Main Street Loans are expected soon. The Senate passed another round of funding last night for the SBA’s PPP, and it’s poised for a house vote on Thursday.
If you were not able to apply before, you need to do what you can to be ready if the program reopens:
- One thing that has become clear during the short life of the PPP Loan program, is having a personal connection with a banker helps navigate the complexities of the Program.
- You will need a variety of financial documents to apply. Gather info that you think you may need.
- Payroll information: Form 941s, payroll summary reports by month for 2019 and 2020
- Operating agreements, organization documents, owner details on > 20% owners
- Calculated loan amount and applicable support documents
- Current financial statements and tax returns
- If the PPP Loan program isn’t replenished, have a back up plan for other tax breaks that may be available. If you are unable to get a PPP Loan, you might be eligible for a payroll tax deferral and the Employee Retention Tax Credit (Consult your Advisor).
- The Federal Reserve also created a Main Street Lending Program (the “Program”) and will purchase up to $600 billion of loans originated by eligible banks made to small- and medium-sized businesses. The Program is supported by $75 billion in equity provided by the Treasury out of a pool of $500 billion reserved under the Coronavirus Aid, Relief, and Economic Security Act (“Act”) for U.S. companies which have not “received adequate economic relief” under other provisions of the Act. Details are still emerging, but this program might be an alternative for those that did not receive funds under the PPP Loan program.
New rules and regulations are being released almost daily. Be ready to evaluate how new rules and regulations may affect you. If you have received your PPP money, contact us for a plan on ensuring you are able to apply for forgiveness.