Date: May 6, 2020
The PPP or the Paycheck Protection Program loans is part of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). It focuses on helping small businesses ensure that their employees are paid and retained amidst this pandemic. There are ways on how you can maximize the use of your loans.
In this webinar, Erica and John explained how small business owners can maximize the use of their loans. Other things discussed are:
- What are allowable and forgivable uses
- What is the covered period in two different circumstances
- The 75% rule and reductions in forgiveness
- The importance of documentation
- Helpful reminders for self-employed individuals
There are differences between allowable and forgivable uses since the terms may differ. The same is true for the covered period. The covered period for the allowable uses ends on June 30, 2020 while the covered period for the forgivable users is the eight weeks period from the date of disbursement of the loan proceeds.
It’s essential for business owners to calculate the end date of the covered period, the eight weeks from the date of the disbursement, and to know when the loan proceeds can be used. It’s also important to use 75% of the loan proceeds for payroll costs to avoid potential reductions.