What is the PPP Loan?:
Are you a small business owner? Or maybe you’re self-employed? If so, you might be interested to know that the second round of the PPP loan is now accepting applications. PPP stands for Paycheck Protection Program. Amidst the devastation of the Coronavirus on small businesses, the government is sending in reinforcements. Rightly so, since they are implementing the regulations which are affecting businesses. Part one of the $669 Billion stimuli was first approved back in April 2020. The second round has been approved by congress, but lenders stopped receiving applications, on March 31st, 2021.
The PPP Loan can go towards business expenses such as payroll costs, overhead fees, and healthcare. It can cover up to two and a half months’ worth of payroll costs. This is good news because small businesses keep our economy afloat. Americans need to be getting paid. It would only add insult to injury, to protect ourselves from this disease, only to create our own demise.
Do I qualify?:
The Small Business Association is in charge of approving loans and setting guidelines. Firstly, your operation must meet the small business sizing requirements. In the first round, 500 employees were okay. Now, PPP only covers up to 300 employees. Secondly, you must have been approved for the First Draw of PPP. Thirdly, your business must have been open since Feb 15th, 2020.
Will you have to pay the PPP Loan back? This is an important question to consider. Contrary to the word “loan,” you may not have to pay anything back. Although, you will have to apply for loan forgiveness separately. There are two requirements you will definitely have to meet. One is that the money must be spent as stated on the loan application. You must adhere to the rules they set forth, on how the money can be spent. That means at least 60% must go to payroll costs. These rules are updated often, so you will have to check in regularly.
Two, you must prove your business has been negatively impacted by Covid. Tax statements from 2019 to 2020 should show a decrease in revenue by 25%. So, get your taxes done early! The good news is, there is no set deadline for forgiveness applications yet. Also, if you don’t meet these requirements, you can still apply. However, you might have to pay some or all of the loan back. However, SBA is charging only 1% interest. For more information on applying, visit their website.
As building inspectors, BarrierEnergy works hand in hand with many different companies. We have great relationships with builders, engineers, contractors, and the like. BarrierEnergy wants this information to be available to all of the public, including our clients. This is our way of showing thanks, knowing we must all help one another to stay afloat. Hopefully, sharing this information will help our communities. If you’re interested in business education check out our blog post on Free Online Collaboration Tools for Professionals. Visit our About Us page to learn more about our family-owned business.