Small Business Loan Program 3/30/2020
Blog
Details continue to come out. Here is what we are seeing so far:
- These will be SBA loans
- No personal guarantees
- Loan amount will be based on 2.5x your average mthly payroll for last 12 mths (exclude mthly comp > $8,333/mth or $100k/yr)
- Can add HC premiums and retirement plan contributions to above
- Apply through banks that are SBA lenders (not all banks are)
- No loan fees
- Not required to retain employees to get the loan
- Part or all of loan can be forgiven based on total payroll, rent, utilities and interest costs in 8 weeks after loan funding less a percentage based on your head count reduction from 2019 to now
- Repayment – for portion of loan not forgiven loans will bear 4% interest and be repaid over 10 yrs, no payments for 1st 6 months
Loan must be applied for by no later than June 30, 2020.
You may want to wait to apply depending on your plans. If you have let employees go and may bring them back this summer, you may want to wait until June to apply so your 8 week loan forgiveness calculation will take into account your higher summer payroll.
Start getting information on your last 12 months payroll and HC premium expenses now as this will have to be submitted with your loan application.
03/30/2020
By: Gary Grottke, CPA, Quality Back Office