PAYCHECK PROTECTION PROGRAM (PPP) INFORMATION SHEET: BORROWERS

https://home.treasury.gov/system/files/136/PPP–Fact-Sheet.pdf

CARES Act Penalty-Free Distributions

• Who can apply? Individuals with an IRA, SEP, SIMPLE, 401(k), 457, 403(b), or DB plan
• Is there a time limit to apply? Yes — End of the year
• Who do you apply with? N/A
• Maximum loan size? $100,000 capped at participant’s account
• Term? End of third calendar year
• Deferment? End of third calendar year
• Interest rate? 0% if paid on time
• Conditional use? None
• Personal guarantee? No
• Collateral? No
• Who is the lender? The plan
• Do affiliated rules apply? Only with regard to individual max of $100,000 from plan(s)
• Grant? No
• Forgiveness? No

CARES Act QRP Loans

• Who can apply? Individuals with a 401(k), 457, 403(b), or DB plan
• Is there a time limit to apply? Yes — End of the year
• Who do you apply with? Plan administrator
• Maximum loan size? $100,000 capped at participant’s account
• Term? 6 years
• Deferment? 1 year
• Interest rate? Federal AFR rates
• Conditional use? None
• Personal guarantee? No
• Collateral? No
• Who is the lender? The plan
• Do affiliated rules apply? Only with regard to individual max of $100,000 from plan(s)
• Grant? No
• Forgiveness? No

Economic Injury Disaster Loans (EIDLs)

• Who can apply? All businesses — including nonprofits, veterans’ organizations, tribal business concerns, sole proprietorships, self-employed individuals, and independent contractors — with 500 or fewer employees can apply
• Is there a time limit to apply? Yes — End of the year for COVID-19
• Who do you apply with? SBA Direct, unless they transfer to SBA lenders
• Maximum loan size? $2,000,000
• Term? 30 years
• Deferment? 6 months-1 year
• Interest rate? 3.75% for profit / 2.75% 501(c)
• Conditional use? Working capital, paid sick leave COVID-19, cost to alleviate specific injury (if PPP loan, cannot use for those purposes)
• Personal guarantee? No
• Collateral? None if less than $200,000
• Who is the lender? SBA Direct unless they transfer to SBA lenders
• Do affiliated rules apply? Yes
• Grant? Yes, $10,000
• Forgiveness? Only on the $10,000 if used for business purpose

Paycheck Protection Program (3P)

• Who can apply? All businesses — including nonprofits, veterans’ organizations, tribal business concerns, sole proprietorships, self-employed individuals, and independent contractors — with 500 or fewer employees can apply
• Is there a time limit to apply? Yes — June 30, 2020
• Who do you apply with? SBA-approved lenders
• Maximum loan size? $10,000,000 or 2.5x average monthly payroll cost as defined in the CARES Act
• Term? 10 years
• Deferment? 6 months-1 year
• Interest rate? 1% for 2 years
• Conditional use? Retain workers – payroll costs, mortgage interest, rents, utilities (100% payroll + 25% non-payroll)
• Personal guarantee? No
• Collateral? None
• Who is the lender? SBA-approved lenders
• Do affiliated rules apply? No
• Grant? No
• Forgiveness? Yes — 8 weeks following close based on expenses set out in CARES Act

Employment Tax Credit under CARES

• Who can apply? No application necessary — must calculate based on number of employees and quarterly compensation
• Is there a time limit to apply? No — Available until the end of the year
• Who do you apply with? N/A
• Maximum loan size? N/A
• Term? N/A
• Deferment? N/A
• Interest rate? N/A
• Conditional use? 50% tax credit on the wages paid to employees from March 13, 2020, to December 31, 2020, up to a maximum of $5,000 credit per employee
• Personal guarantee? N/A
• Collateral? N/A
• Who is the lender? Treasury via payroll tax
• Do affiliated rules apply? No
• Grant? N/A
• Forgiveness? N/A

SBA Express

• Who can apply? For-profit, US-based business, 2 years in business, need, existing financing
• Is there a time limit to apply? Yes — end of year for $1,000,000
• Who do you apply with? SBA-approved lenders
• Maximum loan size? $1,000,000 (December 31, 2020), then $350,000
• Term? Up to 7 years
• Deferment? No
• Interest rate? Negotiated with lender but max is prime + 2.75%
• Conditional use? Sound business purposes
• Personal guarantee? Yes
• Collateral? Over $25,000, determined by lender
• Who is the lender? SBA-approved lender
• Do affiliated rules apply? Yes
• Grant? No
• Forgiveness? No