(NEWS10) – The Paycheck Protection Program, designed to provide financial aid to small businesses still in need of aid as the weeks of COVID-19 shutdown stretch on, is currently back open for its second wave of applications. If you and your business are in need of that aid, there’s no reason not to get started sooner rather than later.
Paycheck Protection Program loans offer the smaller sum out of two options: Either 2.5 times a business’ monthly payroll, or $10 million. The idea is to provide an amount that would add up to around eight weeks of payroll, or as close to it as employees can still live off of during that time period.
Business owners in need can apply for loans through an SBA loan, which can be applied for at any certified bank or credit union or Farm Credit System; this means applying for a loan starts with conatcting your bank.
Lenders have to go through an approval process to be able to process and distribute these loans, so more may be added over time. This week, banks big and small alike are working all hands on deck to get as many applications processed as possible. Visit sba.gov for a full list of SBA lenders by state.
According to the United States Department of the Treasury, all businesses with under 500 employees can apply. That includes nonprofits, veterans organizations, Tribal-owned businesses, self-employed individuals and contractors.
Payroll costs to be covered are capped at $100,000. Money will only be owed back on loans for costs used for things other than payroll costs, mortgage interest, rent and utilities payments. Failure to maintain staff and payroll can also result in owing money back. Essentially that means the money is there to support all of a business’s existing employees. Those amounts will be due 2 years from when a loan is received.
The U.S. treasury’s website contains further details surrounding Paycheck Protection Loans. Applications are due by June 30.
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