The Paycheck Protection Program (PPP) is a federal relief program established by the CARES Act and implemented by the U.S. Treasury Department and the Small Business Administration (SBA) with rules, requirements, protocols and processes that all participating lenders must follow. The first round of funding was fully administered within 14 days of the opening of the program.
A second round of funding was approved with the passing of the PPP & Healthcare Enhancement Act in early summer 2020. That round of funding expired on August 8, 2020. This third round of funding was authorized with the passing of the Consolidated Appropriations Act signed into law on December 27, 2020 (the “PPP2”). The program is authorized through March 31, 2021 or until all funds have been disbursed.
The program provides that as long as you use at least 60% of the funds for covered payroll costs, the entire loan amount may be forgiven.
Eligible borrowers qualify for full loan forgiveness if during the 8- to 24-week covered period following loan disbursement:
Employee and compensation levels are maintained (in the same manner as the first draw if this is a second draw);
The loan proceeds are spent on payroll costs and other eligible expenses; and
At least 60 percent of the proceeds are spent on payroll costs
SBA Overview of First Draw Loans:
SBA Overview of Second Draw Loans: