Late Breaking Updates About the CARES Act Paycheck Protection Program
April 3, 2020
By: Robert G. Tweel
The Treasury Department and Small Business Administration last night issued an interim final rule on the Paycheck Protection Program. The new rule includes updates on the applicable interest rate and documentation and due diligence requirements. The SBA released an updated application.
Here is the final SBA Form 2483, which will be completed by the borrower and retained by the lender with the supporting documents.
Here is the final SBA Form 2484, which will completed by the lender, based upon the borrower's application and submitted to the SBA.
Section 1106 of the CARES Act provides for forgiveness of up to the full principal amount of qualifying loans guaranteed under the Paycheck Protection Program. The Paycheck Protection Program and loan forgiveness are intended to provide economic relief to small businesses nationwide adversely impacted under the COVID-19 Emergency Declaration issued by President Trump on March 13, 2020.
The complete overview of the PPP is here – in case you have missed it. Lenders receive their own guidelines, which can be found here.
Please find a preliminary checklist that borrowers may find helpful:
- 2019 IRS Quarterly 940, 941 or 944 payroll tax reports
- Payroll reports for a twelve-month period (ending on your most recent payroll date), which will show the following information:
- Gross wages for each employee, including officer(s) if paid W-2 wages.
- Paid time off for each employee
- Vacation pay for each employee
- Family medical leave pay for each employee
- State and local taxes assessed on an employee’s compensation
- Documentation showing total of all health insurance premiums paid by the company owner(s) under a group health plan.
- Include all employees and the company owners
- Document the sum of all retirement plan funding that was paid by the company owner(s) (do not include funding that came from employees out of their paycheck deferrals).
- Include all employees and the company owners
- Include 401K plans, Simple IRA, SEP IRA’s
We will continue monitoring changes from the Treasury Department and the SBA and will share them as they are released. For assistance, contact the Jackson Kelly Tax Group.