Paycheck Protection Program

On March 27, 2020, President Trump signed into law the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) which includes the Paycheck Protection Program (“PPP”) to provide relief to many small businesses impacted by the spread of Covid-19.

The PPP provides short-term cash flow assistance to small businesses to help these businesses and their employees deal with the devastating economic impact of the Covid-19 pandemic.  PPP loans are made by lenders certified by the SBA and guaranteed by the federal government. Generally, PPP loans can be as large as 250% of a business's average monthly payroll costs over the last 12 months, not to exceed $10 million. The borrowed fund will eventually be discharged or forgiven if the businesses keep their employees and pay them at least 75% percent of their prior-year compensation.

Generally, the PPP is available to small businesses with 500 or fewer employees.  Eligible small businesses also include sole-proprietors, independent contractors, or other self-employed individuals.

PPP loans must be made prior to June 30, 2020.

The SBA is expected to issue regulations within 15 days after the enactment of CARES Act.  Contact your bank or any SBA certified lenders for additional information.