Frequently Asked Questions: Awaiting SBA Guidance

April 29, 2020

While we have many answers to the PPP loan program (see separate FAQ section), there are also many questions that we are awaiting guidance on from the SBA.   We understand that these questions are critical in maximizing the forgiveness portion of the PPP loan and hope to get guidance in the next couple of weeks.   As soon as guidance is issued, we will inform our clients immediately to begin to strategize on maximizing loan forgiveness.

We have listed the most commonly asked questions that we are waiting for official guidance on below.

For payroll paid during the covered period is it based on the date paid or is it based on when the payroll was incurred?  

 

Is there a limit on how much an employee can make compared to the most recent quarter if it is not in excess of $100,000 on an annual basis?

 

Is rent, utilities, interest, etc. in arrears eligible for forgiveness if paid during the covered period? What about amounts paid in advance?

 

For employees laid off prior to 4/27 and hired back by 6/30 is there a time period they must remain employed in order to avoid a reduction in loan forgiveness?

 

How do you define FTE? Is it 30, 35 or 40 hours?

 

We know non-mortgage interest is a covered cost, but is it also eligible for forgiveness?

 

How do you measure the 25% reduction amount for payroll?  For example, from 1/1/20 to 3/31/20, do you look at number of hours, rate per hour, or just total compensation during that period?

 

If you gave a bonus to employees during Q1 of 2020 that is not a part of their normal compensation, is that included when looking at the 25%reduction for payroll?

 

What is “transportation” with regards to being a utility?  Does this include mileage, gas for vehicles, etc.?

 

Does “rent” include all leases (building, vehicle,equipment, copiers)?  If not, what is included?

 

Are there any restrictions on compensation (increases) for related parties (mother, father, brother, sister, child, etc.)?

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