What to know about the Paycheck Protection Program

The Paycheck Protection Program (PPP) was created under the Coronavirus Aid, Relief, and Economic Support — or CARES — Act, signed into law on March 27. We have compiled the following information to help you navigate the PPP application process. We will continue to bring you information as it develops. Check this section for updates.


PPP authorizes up to $349 billion in forgivable loans to small businesses to pay their employees during the COVID-19 crisis.

The loan amounts will be forgiven as long as:

  • The loan proceeds are used to cover payroll costs, and most mortgage interest, rent, and utility costs over the 8-week period after the loan is made
  • Employee and compensation levels are maintained.

When can I apply?

Small business owners can apply today (April 9) and independent contractors can start applying April 10.

These loans are first come, first served — if you need utilizing this program, we suggest you start the process as soon as possible. We are also hearing of long waits on phone lines, so please allow yourself plenty of time when contacting your bank.


Where can I apply?

You can apply through any existing SBA lender or through any federally insured depository institution, federally insured credit union, and Farm Credit System institution that is participating. Visit www.sba.gov for a list of SBA lenders.

We are getting reports that some banks are still in the process of setting up their PPP loans and are not yet accepting applications. If you have a preferred bank, you may want to check on their timeframe and ensure it is going to active by the PPP deadline.

Who can apply?

All businesses — including nonprofits, veterans organizations, tribal business concerns, sole proprietorships, self-employed individuals, and independent contractors — with 500 or fewer employees can apply.

What do I need to apply?

You will need to complete the PPP loan application and submit it with the required documentation to an approved lender that is available to process your application by June 30, 2020.

What other documents will I need to include in my application?

You will need to provide your lender with payroll documentation.

Follows is a list of items our members have had to provide. We suggest having as many of these on hand as possible BEFORE you apply.

  • 2019 payroll (total payroll for full year 2019, by employee, as reported to the IRS)
  • 2019 independent contractor costs (a listing of 1099-MISCs for 2019 independent contractors, by person, as reported to the IRS; however, do not include 1099s for services)
  • Payroll report as of February 15, 2020 or closest date after that date, by employee
  • Four 2019 quarterly 941 payroll returns
  • 12 monthly payroll summaries by employee and company totals for April 2019 through March 2020
  • Documentation of proof of health insurance premiums and retirement plan contributions paid by the company over the same period as the payroll summaries
  • A fully completed, initialed and signed federal PPP loan application
  • An Excel® file that breaks down the payroll data by month for April 2019 through March 2020.; this is used to calculate the average monthly number.

How long will this program last?

Although the program is open until June 30, 2020, we encourage you to apply as quickly as you can because there is a funding cap and lenders need time to process your loan.

What can I use these loans for?

  • Payroll costs, including benefits
  • Interest on mortgage obligations, incurred before February 15, 2020
  • Rent, under lease agreements in force before February 15, 2020
  • Utilities, for which service began before February 15, 2020.

What counts as payroll costs?

Payroll costs include:

  • Salary, wages, commissions, or tips (capped at $100,000 on an annualized basis for each employee)
  • Employee benefits including costs for vacation; parental, family, medical, or sick leave; allowance for separation or dismissal; payments required for the provisions of group health care benefits including insurance premiums; and payment of any retirement benefit
  • State and local taxes assessed on compensation
  • For a sole proprietor or independent contractor — wages, commissions, income, or net earnings from self-employment, capped at $100,000 on an annualized basis for each employee.

How large can my loan be?

Loans can be for up to two months of your average monthly payroll costs from the last year plus an additional 25% of that amount.

How much of my loan will be forgiven?

You will owe money when your loan is due if you use the loan amount for anything other than payroll costs, mortgage interest, rent, and utilities payments over the 8 weeks after getting the loan. Due to likely high subscription, it is anticipated that not more than 25% of the forgiven amount may be for nonpayroll costs.

You will also owe money if you do not maintain your staff and payroll.

  • Number of staff — your loan forgiveness will be reduced if you decrease your full-time employee headcount.
  • Level of payroll — your loan forgiveness will also be reduced if you decrease salaries and wages by more than 25% for any employee that made less than $100,000 annualized in 2019.
  • Rehiring — you have until June 30, 2020 to restore your full-time employment and salary levels for any changes made between February 15, 2020 and April 26, 2020.

What is my interest rate?

It’s a 1.00% fixed rate.

When do I need to start paying interest on my loan?

All payments are deferred for 6 months; however, interest will continue to accrue over this period.

When is my loan due?

In 2 years.