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Paycheck Protection Program application to open Friday

Banking & Finance
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The Small Business Administration released more information Tuesday on the $349 billion Paycheck Protection Program targeting small business job retention.

Small businesses and sole proprietorships will be able to apply for (.pdf) and receive payroll-coverage loans (.pdf) through existing SBA lenders starting Friday, while independent contractors and self-employed individuals can apply starting April 10, according to a news release and information provided on the Department of Treasury website. The deadline for application processing will be June 30.

Eligible small businesses, nonprofit organizations, veteran’s organizations, tribal businesses, independent contractors and self-employed individuals will be able to qualify for a loan up to $10 million with a six-month payment deferral period, according to the release. Some businesses with more than 500 employees will be considered if they meet SBA employee-based size standards for industry exceptions.

SBA affiliation standards will be waived for this program for small businesses in the hotel and food services industry, according to the release.

The loan amount will be determined by the business’s last eight weeks of prior average payroll with an additional 25% of that amount. The SBA will forgive a portion of the loan covering the initial eight weeks of payroll after the loan is made, including most mortgage interest, rent and utility costs during this period, the release said.

Payroll costs will cap at $100,000 for each employee on an annualized basis.

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April 01, 2020

what is included in the payroll part. The description in yesterday information said the expenses included payment for vacation sick pay etc. Health benefits payment , any retirement benefits, State and Federal tax assessed on the compensation of employees etc. The Bulletin today tells us nothing about what to include for expenses.

April 01, 2020

According to the Department of Labor guidelines linked above, payroll costs include salary, wages, commissions, tips, state and local taxes assessed on compensation, and employee benefits such as vacation, parental, family, medical or sick leave, retirement benefit payments, and group health care benefit payments. For sole proprietorships or independent contractors, wages, commissions, income or net earnings are also considered payroll costs. // Molly Hulsey, staff writer