Just a few days ago, the Coronavirus Aid, Relief, and Economic Security (CARES) Act became law. We wanted to share more details about the Small Business Administration’s Paycheck Protection Program, a loan program designed to help small business owners.

The Small Business Administration released detailed guidelines for borrowers that explain the provisions and how you can benefit.

Here are a few things to keep in mind:

  • Small businesses can get a forgivable loan for three times their monthly payroll plus 25% but applications have to be submitted by June 30, 2020. Funding may be spent on payroll, rent and some other qualified expenses. Businesses must keep or hire back employees for specified period or the loan is not forgiven.
  • Applications for the Paycheck Protection Program are available now and started being accepted Friday, April 3, 2020. The program ends on June 30, 2020. Click here for the sample application.
  • You can apply for these loans through approved SBA lenders, but other regulated lenders will be available soon. It's best to start with your own bank, since banks that are approved SBA lenders will likely work with their existing customers first.
  • The program authorizes $349 billion toward job retention and business operating expenses. However, there is a funding cap, so if you do decide to proceed with a loan, we encourage you to apply quickly as lenders will need time to process your loan.
  • SBA is also giving out Economic Injury Disaster Loans (EIDL) loans. A small business must contact the SBA directly for this program. The SBA Eastern Pennsylvania District Office is at 660 American Ave. Suite 301, King of Prussia, PA 19406 Phone: 610-382-30 To apply for a COVID-19 Economic Injury Disaster Loan, click here.
To confirm your application is complete, you will be asked for supporting documents. Here is a sample checklist, which may vary by lender:
  • SBA Form 2483 - Paycheck Protection Program Application.
  • Completed Paycheck Protection Program Calculator. The maximum loan amount from the calculator must match the requested loan amount on SBA Form 2483.
  • Payroll processor records detailing all compensation paid to each employee during February 2020.
  • Payroll processor records detailing all compensation paid to each employee, excluding amounts per employee over $100,000, from January 1, 2019 to December 31, 2019.
  • Documentation showing the total cost of group health care coverage from January 1, 2019 to December 31, 2019.
  • Documentation showing the total of all employer paid retirement benefit cost from January 1, 2019 to December 31, 2019.
  • Documentation showing all state and local taxes assessed on compensation of employees from January 1, 2019 to December 31, 2019.
For more information about the Paycheck Protection Program click here. We’ll continue to update you with new information as it becomes available. Please forward this information to any small business owners or others you know who can benefit.