PAYCHECK PROTECTION PROGRAM LOANS
We understand that these are challenging times and a small business like yours needs any help possible.
We are here to make the SBA Paycheck Protection Program application process streamlined and easier.
The Paycheck Protection Program (PPP) is a new loan program for small businesses. The program will be administered by the Small Business Administration (SBA), which will fully guarantee loans provided by approved lenders to eligible entities. Forgiveness of these loans is also available under certain circumstances and the SBA has announced that it will be providing guidance on loan forgiveness. Here is some additional information about the PPP:
Eligible Businesses: Businesses and nonprofit organizations with no more than 500 employees are eligible for the PPP through June 30, 2020. Businesses must have been in operation, with employees, on February 15, 2020. There are special rules for determining the 500-employee limit (for example, for employers in the Hospitality and Food Service industries (NAICS code 72), the 500-employee limit may be determined based on the number of employees per physical location). Certain franchises may also qualify as separate businesses.
Maximum Loan Amount: PPP loans will be provided in amounts approximately equivalent to ten weeks of payroll costs. Loan amounts are determined based on 250% of average monthly payroll costs, taking into consideration average wages paid during the applicable period (which will either be the one-year period prior to the loan or calendar year 2019, at your option), up to a limit of $10 million. There are alternate periods for seasonal employers and those not in business in the prior year.
In addition to wages, commissions, and other compensation, the calculation of payroll costs includes employer healthcare costs such as insurance premiums, employer state and local taxes paid on employee gross pay, and other specified costs. However, as provided by the CARES Act, this calculation excludes employee annual salary over $100,000 per employee.
Loan Forgiveness: Up to 100 percent of the PPP loan is forgivable (to the extent that employers maintain specified employment and wage levels), and the loan amounts forgiven are excluded from taxable income for federal income tax purposes. The loan will be fully forgiven if the funds are used for payroll costs and the other Loan Uses described above (however, the SBA has announced that due to likely “high subscription,” at least 75 percent of the forgiven amount must have been used for payroll).
To determine the amount that will be forgiven, the average number of full-time equivalent employees per month during the 8-week period from the date of the loan will be compared to either the period from February 15, 2019 to June 30, 2019 or January through February of 2020, at the option of the borrower. An alternate calculation may apply for seasonal employers. A similar comparison will apply to wage levels.
Repayment of a corresponding part of the loan may be required if earnings of an employee is reduced by 25% or more during the 8-week period from the date of the loan compared to the most recent full quarter of employment before the date of the loan. In addition, reductions in the number of employees or compensation occurring between February 15 and April 26, 2020 will not be considered in reducing the loan forgiveness amount if reversed by June 30, 2020.
Lenders will be required to obtain specified documentation to demonstrate employment and wage levels through the period.
The Paycheck Protection Program is a loan designed to provide a direct incentive for small businesses to keep their workers on the payroll. SBA will forgive loans if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest, or utilities.
*No loan is considered approved and available for funding until the SBA has processed your application and issued its approval.We expect that the demand for the Small Business Administration (SBA) Paycheck Protection Program loans will exceed the available amount. Given the urgency surrounding this program and limited SBA funds, not all applicants will be approved by the SBA and receive funding. Ironworkers USA CU cannot guarantee that your loan will be approved and funded.
In order to apply for the Small Business Administration’s Paycheck Protection Program, you are required to complete an application and submit supporting documents. Download the needed documents by following this link: PPP Needed Documents.
The download will include two documents:
The application checklist and PPP loan calculator documents should be filled out in their entirety and be submitted with supporting data including (but not limited to):
Understanding and filling out the application may be daunting, so please visit our YouTube channel or folder with training decks for assistance!
Finally, once you have filled out your application and collected all of your supporting data, please upload the following three items to the provided portal (Hipereon Processing Portal Link)**
1. PPP Applicant Checklist
2. SBA PPP Application
3. All supporting documentation (only those necessary to prove how the numbers were calculated)
Please name all documents with Your Identifier (from above), Document Name, and Date. For example, “ IWCUxxxx– Calculator – 04.22.20.pdf”.
Please note that no documentation will be opened or reviewed if sent via email or other means.