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We have had a lot of calls and questions coming in from clients asking to help with the latest PPP 2 application process.

So, we thought we would throw out a few important details for those of you that have similar questions but maybe just haven’t made it to the phone or Google yet.  

Criteria For Qualification

  1. Already received PPP 1 and have, or will, use the full amount (if you are applying for the PPP loan for the first time now, it’s still considered as PPP round 1)
  2. In business prior to 2/15/2020
  3. Have less than 300 employees, except for NAICS sector 72 business – hotel and food services
  4. 25% reduction in gross receipts (*a) in 2019 vs 2020 any quarter

Loan Amount Calculations:

  1. Higher than average monthly payroll 2019 or 2020 x2.5 (3.5 for hotel and food services)
  2. Payroll costs include:
      • employee compensation (salary, wage, commission, bonus)
      • payment for vacation, parental, family, medical or sick leave
      • payment of employee benefits: group health care insurance, group life, disability, vision or dental insurance
      • employer portion of retirement benefits
      • employer’s state and local taxes assessed on compensation of employees

Bank Requested Supporting Documents:

  1. Proof of gross receipt reduction:
  • Quarterly financials to show revenue reduction of less than 25%, for example:2019 Q1 vs 2020 Q1
  • Use bank statement if cash basis
  1. Proof of payroll cost
      • 3rd party payroll report broken out per employee (for the whole year of 2019 or 2020)
      • Form 941 (for the whole year of 2019 or 2020)
  1. Proof of non-payroll cost
      • Income tax returns (for 2019 or 2020) (*b)
  1. Proof of operations
      • Any payroll doc to show the business was in operation and paying employees as of 2/15/2020.

(*a) Definition of gross receipts:

1. Either accrual or cash basis
2. Source including sales of products, services, interest, dividend, rent, royalties, fees, commission, reduced by returns and allowance

(*b) Tax return forms:

1. 1120 for C-Corp and 1120S for S-Corp  
2. 1040 Schedule C for Sole Proprietors
3. 1065 or K-1 for Partnership
4. 990 for Exempt Organizations
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