*Please note that the following information is provided as a helpful overview of certain initial terms and conditions of the Paycheck Protection Program only. It is not intended as a definitive statement and should not be relied on nor should it be considered legal advice. For detailed guidance on the terms of the Paycheck Protection Program, please consult the interim final rules produced by the Small Business Association (SBA), the other guidance published thereby, or your legal counsel or other advisors. 

SBA PPP Alert

March 30, 2021

The Paycheck Protection Program deadline to apply has been extended to May 31st! Funds are limited so don't wait to apply.


Second draw SBA update

March 15, 2021

The SBA is now allowing businesses who received a first draw PPP loan in 2021 to receive a second draw. This is what you need to receive a second draw loan:

  1. Received a First Draw PPP Loan, and have used, or will use, the full amount of the First Draw PPP Loan on or before the expected date on which the Second Draw PPP Loan will be disbursed

  2. You must be able to show that your revenue has decreased by 25% or more in the same quarter of the prior year

  3. Your loan will be calculated based on 2.5x monthly payroll or 3.5x monthly payroll for borrowers in the Accommodation and Food Services sector (use NAICS 72)

Apply for your second draw loan HERE

Schedule C filer loan calculation update

February 24

  • At this time for borrowers that file IRS Form 1040 Schedule C the loan amount will be calculated on the net income amount until we have direction from the SBA on how to change the calculation using the gross income amount. Once we receive guidance from the SBA we will be able to amend your loan amount prior to funding.
  • The program will also make it easier for non-citizen small business owners who use an ITIN to file taxes to submit their applications.
  • The program will remove restrictions on student loan debt delinquency and for certain felonies.

For more information, please reference the White House factsheet

What Is The Paycheck Protection Program?

The Paycheck Protection Program (PPP) is a loan program created by the CARES Act and administered by the Small Business Administration (SBA) that provides government-guaranteed, forgivable loans for qualifying small businesses to maintain their payrolls and pay other qualifying business expenses (meaning that, if you use the loan funds as directed and follow all other program requirements, you will not need to pay the loan back).

How do I apply for a PPP Loan?

You can apply for your PPP funds now with Amur at https://go.amuref.com/amurcustomer

Who qualifies for a ‘first draw’ PPP Loan?

If you are a small business, sole proprietor, independent contractor, or an eligible self-employed individual and you have not yet received a PPP loan, you may qualify if you were in operation on Feb. 15, 2020 and:

  • You have 500 or fewer employees;
  • You are a not for profit, including a church;
  • You are a Section 501(c) organization such as a housing cooperative, business league, or similar organization with 300 or fewer employees; or
  • You are a qualifying news organization or a tribal business with 500 or fewer employees.

Who qualifies for a ‘second draw’ PPP loan?

If you are a small business, sole proprietor, independent contractor, or an eligible self-employed individual and you received a PPP loan in 2020, you may qualify for a ‘second draw’ PPP loan if:

  • You have 300 or fewer employees; 
  • You experienced a revenue reduction of 25% or greater in any quarter of 2020 relative to the same quarter of 2019;
  • You have used, or will use, the full amount of your First Draw PPP loan on or before the expected date on which the Second Draw PPP loan is disbursed to you; and
  • You have used, or will use, the full amount of your First Draw PPP loan on qualifying expenses under applicable PPP rules and guidelines issued by the SBA.

How will my PPP loan size be calculated? 

For most businesses, you will be eligible for a PPP loan equal to an amount that is 2.5 times your business’s (or organization’s) annual average monthly payroll costs.  However, there are certain types of businesses, namely restaurants, hotels, and event venues that have a NAICS code starting with 72, that are eligible for PPP loans equal to 3.5 times annualized average monthly payroll costs for Second Draw loans.  See SBA rules and guidelines for more details on the calculation of PPP loan size. 

What business are now eligible for PPP loans that were previously ineligible?

Under the Economic Aid Act, the SBA has expanded the types of businesses eligible to receive PPP loans.  The businesses that are now eligible to receive funding include: 

  • News organizations;
  • Some hospitals owned by government entities;
  • Electric, telephone, and housing cooperatives;
  • 501(c)(6) organizations and 501(c)(19) tax-exempt veterans’ organizations;
  • Tribal businesses;
  • Destination marketing organizations; and
  • Certain faith-based organizations.

I’m self-employed and have no employees, how do I calculate my maximum First Draw PPP loan amount?

The following steps should be used if you are an independent contractor or sole proprietor (but not if you are a partner or partnership)

Step 1: Look at your 2019 IRS Form 1040 Schedule C line 7 net income amount. If the amount is over $100,000 reduce it to $100,000. (If line 31 is Zero or negative you are not eligible for a PPP loan).

Step 2: Calculate the average monthly net profit amount by dividing the amount from step 1 by 12

Step 3: Multiply the average monthly net profit from step 2 by 2.5

Step 4: Add the outstanding amount of any Economic Injury Disaster Loan (EIDL) made between January 31, 2020 and April 3, 2020 that you seek to refinance. (Do not include the amount of any advance under an EIDL Covid-19 loan because it does not have to be repaid).

I’m self-employed and have employees, how do I calculate my maximum First Draw PPP loan amount?

The following steps should be used to calculate the maximum amount that can be borrowed if you are self-employed with employees including if you are an independent contractor or sole proprietor (but not if you are a partner or partnership)

Step 1: Compute your 2019 payroll costs by adding the following

2019 IRS Form 1040 Schedule C line 31 net profit amount

  • If this amount is over $100,000, reduce it to $100,000
  • If this amount is less than zero, set this amount at Zero

2019 Gross wages and tips paid to your employee's whose principal place of residence is in the United States, up to $100,000 per employee, which can be computed using

  •  2019 IRS Form 941 Taxable Medicare wages & tips (line 5c-column 1) from each quarter,
  •  Plus, any pre-tax employee contributions for health insurance or other fringe benefits excluded from Taxable Medicare wages & tips, and
  •  Minus any amount paid to any individual employee in excess of $100,000, and any amounts paid to any employee whose principal place of residence is outside the United States;

2019 employer contributions for employee group health, life, disability, vision, and dental insurance (the portion of IRS Form 1040 Schedule C line 14 attributable to those contributions);

  • 2019 employer contributions to employee retirement plans (IRS Form 1040 Schedule C line 19); and
  • 2019 employer state and local taxes assessed on employee compensation, primarily state unemployment insurance tax (from state quarterly wage reporting forms).

Step 2: 

Calculate the average monthly payroll costs amount (divide the amount from Step 1 by 12).

Step 3: 

Multiply the average monthly payroll costs amount from Step 2 by 2.5.

Step 4:  Add the outstanding amount of any EIDL made between January 31, 2020 and April 3, 2020 that you seek to refinance. Do not include the amount of any advance under an EIDL COVID-19 loan (because it does not have to be repaid).

How do partnerships apply for PPP loans, and how is the maximum First Draw PPP Loan amount calculated for partnerships (up to $10 million)?

The following steps should be used to calculate the maximum amount that can be borrowed for partnerships (partners’ self-employment income should be included on the partnership’s PPP loan application; individual partners may not apply for separate PPP loans)

Step 1: 

Compute 2019 payroll costs by adding the following:

2019 Schedule K-1 (IRS Form 1065) Net earnings from self-employment of individual U.S.-based general partners that are subject to self-employment tax, multiplied by 0.9235,^5 up to $100,000 per partner:^6

• Compute the net earnings from self-employment of individual U.S.-based general partner that are subject to self-employment tax from box 14a of IRS Form 1065 Schedule K-1 and subtract any section 179 expense deduction claimed in box 12; any unreimbursed partnership expenses claimed; and any depletion claimed on oil and gas properties;

• if this amount is over $100,000, reduce it to $100,000;

• if this amount is less than zero, set this amount at zero;

2019 gross wages and tips paid to employees whose principal place of residence is in the United States, up to $100,000 per employee, which can be computed using:

• 2019 IRS Form 941 Taxable Medicare wages & tips (line 5c-column 1) from each quarter,

• Plus any pre-tax employee contributions for health insurance or other fringe benefits excluded from Taxable Medicare wages & tips, and place of residence is outside the United States.

• Minus any amounts paid to any individual employee in excess of$100,000 and any amounts paid to any employee whose principal

Step 2: 

Calculate the average monthly payroll costs (divide the amount from Step 1 by 12).

Step 3: 

Multiply the average monthly payroll costs from Step 2 by 2.5.

Step 4:  Add any outstanding amount of any EIDL made between January 31, 2020 and April 3, 2020 that you seek to refinance. Do not include the amount of any advance under an EIDL COVID-19 loan (because it does not have to be repaid).

What other documentation can an applicant provide for the purpose of substantiating payroll costs used to calculate the applied-for First Draw PPP Loan amount?

Applicants may provide IRS Form W-2s and IRS Form W-3 or payroll processor reports, including quarterly and annual tax reports, in lieu of IRS Form 941. Additionally, very small businesses that file an annual IRS Form 944 or agricultural employers that file an annual IRS Form 943 should rely on and provide IRS Form 944 or IRS Form 943 in lieu of IRS Form 941.

How should a borrower account for federal taxes when determining its payroll costs for purposes of the maximum loan amount, allowable uses of a PPP loan, and the amount of a loan that may be forgiven.

Payroll costs are calculated on a gross basis without regard to federal taxes imposed or withheld, such as the employee’s and employer’s share of the Federal Insurance Contributions Act (FICA) and income taxes required to be withheld from employees. As a result, payroll costs are not reduced by taxes imposed on an employee and required to be withheld by the employer. However, payroll costs do not include the employer’s share of the payroll tax. For example, the wages of an employee who earned $4,000 per month in gross wages, from which $500 in federal taxes was withheld, count as $4,000 in payroll costs. However, the employer-side federal payroll taxes imposed on the $4,000 in wages are excluded from payroll costs under the statute.

How long will it take to receive PPP funds?

Once a borrower receives a Preferred Lender Program (PLP) number for its loan, the loan is approved by the SBA, and funds are reserved for the borrower. Starting on the date a borrower receives a PLP number, the lender has 10 calendar days to disburse funds. Once the Borrower receives the loan, the borrower has a period of between eight and twenty-four weeks (as selected by the borrower) to spend the PPP loan amount on permitted uses to qualify for forgiveness.

When do I have to repay a Paycheck Protection Program loan?

If you don't apply for forgiveness, your first payment will be due 10 months after you receive your loan with a maturity of five years.  

Can I receive a PPP loan if I have other loans?

Yes, you can qualify for a PPP loan even if you already have other loans, including other SBA loans. However, you cannot use the funds from PPP loans and other loans for duplicate use at the same time. For example, if you use a disaster loan (EIDL) to pay your business’s rent in January, you cannot also apply for a PPP loan to cover January rent.

Will I owe any fees on a loan under the Paycheck Protection Program?

No. Lenders are not allowed to impose fees on borrowers under the program.

Are PPP expenses tax-deductible?

Yes, your PPP expenses will be tax-deductible.

What expenses can I pay with my PPP loan? 

You may use your PPP loan to pay the following items, with the additional requirement that at least 60% of your PPP loan must be spent on payroll costs: 

  • payroll costs;
  • costs related to the continuation of group health care benefits during periods of paid sick, medical, or family leave, and insurance premiums;
  • mortgage interest payments (but not mortgage prepayments or principal payments);
  • rent payments;
  • utility payments;
  • interest payments on any other debt obligations that were incurred before February 15, 2020;
  • refinancing an SBA EIDL loan made between January 31, 2020 and April 3, 2020;
  • covered operations expenditures (see SBA rules and guidelines for further details);
  • covered property damage costs (see SBA rules and guidelines for further details);
  • covered supplier costs (see SBA rules and guidelines for further details); or
  • covered worker protection expenditures (see SBA rules and guidelines for further details).

How does loan forgiveness work under the Paycheck Protection Program?

To be eligible for forgiveness, all PPP loan amounts must be used on qualifying expenses, including a requirement that 60% of PPP loan amounts be used on payroll.  If you use less than 60% of loan funds on payroll expenses, you will be eligible for partial loan forgiveness.

How do I apply for forgiveness for the Paycheck Protection Program loan I received?

For details on how to apply for forgiveness, visit our Help Center.

Technical Questions

How do I translate my application in Chrome?

When you come across a page written in a language you don't understand, you can use Chrome to translate the page.

Open Chrome and go to the desired webpage written in another language. At the top of the page, click Translate and Chrome will translate the webpage this one time.

Not working? Try refreshing the webpage. If it’s still not working, right-click anywhere on the page. Then, click Translate to [Language].

Chrome language translation help!

What do I need to do if I’m unable to proceed from one section to another?

The most common reason for this to occur is a required field is missing, we recommend that you look through the page to ensure nothing is missing or if there is a red error message anywhere on the page. If everything appears to be entered, we suggest that you refresh your page or exit the application and try again.

What documentation format is required to be uploaded?

When uploading bank statements: You can upload any type of PDF, however, we recommend you use the PDF that you download straight from your online banking portal and submit them unedited.

When uploading other documents: Our portal allows for flexibility to allow almost any file type to be uploaded such as PDF, JPEG, PNG…etc.

Where can I learn more about the PPP program?

You can learn more details about the Paycheck Protection Program at https://www.amuref.com/covid-relief 

For additional information please visit the SBA.gov website
 

You can also speak with our PPP support team via phone, email or live chat HERE