Chapter 7
Payroll Protection Plan "PPP"
How Can the PPP Loan Help You?
We Know Business
What is the Payroll Protection Program?
The Payroll Protection Program, or “PPP” for short, is the program for Small Businesses (under 500 employees) that helps pay 8 weeks of their payroll. There are lots of articles out there about the PPP, but who is it for? Short answer is - almost EVERYONE.
Who is the PPP for?
If you have employees for whom you pay W-2 wages, this is for you.
If you work for a “company,” but they pay you as an independent contractor (meaning you get a 1099 at the end of the year), this is for you. If this is a side job where you make money selling crafts or driving for UBER, this is for you. If you make money doing something for someone that is NOT included in your W-2 income, this is for you.
Who is this not for?
Someone working for a company that pays them via a W-2 at the end of the year - this is NOT for you.
How does the PPP work?
Your normal bank loans you up to 2.5 times your last 12 months of Payroll “Average Monthly Payroll” and lets you use the money on Qualified Expenses like Payroll, Rent, Mortgage Payments, Utilities, Interest Expenses, Healthcare, Dental and Vision Premiums.
When can I apply?
You can apply now - until the money runs out.
All sounds simple right? Well, “Yes” and “No.” While the principles are simple, the issues come in the way you calculate the Average Monthly Payroll and then how you spend the money you get. If you spend the money on Qualified Monthly Expenses, then the loan is 100% forgivable!