What Is The Covered Period For PPP?

What is the deadline to apply for PPP forgiveness?

The SBA has not set a deadline to apply for forgiveness, but you have 10 months after the end of your covered period before you’ll be required to start making monthly payments..

What documents are needed for PPP forgiveness?

For the payroll portion of your PPP loan, you will need to provide documents from your payroll provider and proof of paying employment taxes with IRS and state forms. Eligible payroll costs include salaries and wages, health benefits, and paid leave (i.e. vacation, parental, family, medical, or sick leave).

Can owners salary be included in PPP?

Yes, essentially! You can treat the Owner Compensation Replacement as personal income and use it however you want. With the updated guidance allowing for 2.5 months’ worth of net profit as OCR, that means your entire PPP loan could be used for personal purposes—essentially free money.

How do you calculate PPP forgiveness?

PPP forgiveness calculationCalculate payroll and non-payroll costs. Line 1: Payroll costs. … Make adjustments for full-time equivalency* (FTE) and salary/hourly wage reductions. Line 5: Total salary/hourly wage reduction of more than 25% … Calculate potential forgiveness amounts. Line 8: Modified total (line 6 X line 7) … Arrive at the forgiveness amount.

Do I have to wait 24 weeks to apply for PPP forgiveness?

Expanding to 24 weeks, from eight weeks, the covered period during which PPP loan recipients can spend the funds and still qualify for loan forgiveness. The 24-week period applies to all loans made on or after June 5. Borrowers that received loans before June 5 can choose to elect an eight-week period.

What is the covered period of the PPP loan?

NOTE: The Covered Period for PPP loans is the 24-week period immediately following disbursement of the loan or a period ending on December 31, 2020, whichever is shorter. If you received your loan prior to June 5, 2020, you may choose the 8-week period following disbursement of your loan as your Covered Period.

Should I wait to apply for PPP forgiveness?

Most Paycheck Protection Program (“PPP”) borrowers are working toward full forgiveness of their PPP loans and are anxious to get this process started. … But that does not mean a borrower should submit a loan forgiveness application as soon as possible.

What are the rules for the PPP loan forgiveness?

Forgiveness for self-employed individuals You are eligible to claim 2.5 months’ worth of your 2019 net profit to replace pay. If you didn’t have any other payroll expenses factoring into your PPP loan amount, this means that your entire PPP loan could be forgiven for the 24-week period.

Who is not eligible for a PPP loan?

Passive businesses owned by developers and landlords that do not actively use or occupy the assets acquired or improved with the loan proceeds (except as Eligible Passive Companies under 13 CFR § 120.111) are not eligible.

What is the alternative covered period for PPP?

Answer: If the borrower uses a biweekly or more frequent (e.g., weekly) payroll cycle, the borrower may elect to calculate eligible payroll costs using the eight-week (for borrowers that received their loans before June 5, 2020 and elect this Covered Period length) or 24-week period that begins on the first day of the …

Are owners salaries included in PPP forgiveness?

Eligibility for the EZ application form: SBA confirmed that “sole proprietors, independent contractors, and self-employed individuals who had no employees at the time of the PPP loan application and did not include any employee salaries in the computation of average monthly payroll in the Borrower Application Form” …

What is the 24 week period for PPP?

If 24 weeks, it begins on the date the loan proceeds are disbursed and ends 24 weeks (168 days) from that date. Alternative Period – Borrowers with a bi-weekly or more frequent payroll schedule may elect the Alternative Period.

What is covered under the PPP?

PPP loans covers payroll costs, including costs for employee vacation, parental, family, medical, and sick leave. However, the CARES Act excludes qualified sick and family leave wages for which a credit is allowed under sections 7001 and 7003 of the Families First Coronavirus Response Act (Public Law 116–127).

Is it too late to apply for PPP forgiveness?

30, 2020, has until Aug. 30, 2021, to apply for forgiveness before loan repayment begins. The SBA placed the expiration date in the upper-right corner of the PPP loan forgiveness application forms to comply with the Paperwork Reduction Act.

Who is eligible for the 24 week PPP program?

If you were assigned a PPP loan number on or before June 5, 2020, you now have the option of taking 24 weeks to spend the funds instead of eight weeks. Borrowers whose loan numbers were assigned after June 5 will automatically have a forgiveness period that is the shorter of: 24 weeks, or.