Update to Paycheck Protection Program Loans
The Coronavirus Aid, Relief and Economic Security Act (the CARES Act), among other things, created the Paycheck Protection Program (PPP), which provides for low interest loans to pay certain payroll and operating costs of eligible small businesses, along with possible forgiveness of all or portions of the loan. Certain applications for loans under the CARES Act are now being accepted. We recommend that you check with your financial institution to make certain you are submitting for the PPP loan using their required application form and providing other required documentation.
Starting April 10, 2020, self-employed individuals and independent contractors can apply and receive PPP loans. As funds are limited, interested borrowers should be prepared to make application as early as possible.
Additional clarifications on the implementation of the PPP were published yesterday. The text of the publication can be accessed here. Notable clarifications in the most recent publication provide that:
Portions of PPP loans not forgiven will accrue interest at a rate of 1%.
Independent contractors will not be considered when determining payroll costs (for loan amount determination) or for loan forgiveness.
Our attorneys are familiar with the CARES Act and the PPP and are here to assist you with any questions you may have regarding eligibility for loans. Please contact us at 215-887-0200. More information on the CARES Act and the PPP can be found in our firm’s COVID-19 Resource Center by clicking here.