Payroll Protection Program - SBA 7(a)
The Paycheck Protection Program provides 100% federally guaranteed loans to small businesses that maintain their payroll during this emergency. Businesses with 500 employees or fewer, including sole proprietors and independent contractors, may be eligible for SBA 7(a) loans in response to COVID-19 covering expenses for the period of Feb. 15, 2020 through June 30, 2020. The CARES Act appropriates $349 billion to cover these loans.
- The loan amount will be 250% of the average salary expenditures/month for the year prior to the loan, up to $10 million. For businesses not open yet in that period, the SBA will look at earlier receipts from 2020.
- 7(a) loans can be used for:
- Payroll, including for independent contractors and employees who work on commission
- Rent/Mortgage interest
- All or a portion of these loans will be forgivable for businesses that maintain at least 75% of the average payroll levels as in the previous year; forgivable amounts phase out as employers payroll levels drop below that.
Apply through a local SBA Lender here. More information can be found here.
Once a PPP Loan has been secured, the application for loan forgiveness may be accessed here.