What Expenses Are Eligible For PPP?

What are payroll fees for PPP forgiveness?

Answer: Payroll costs include all forms of cash compensation paid to employees, including tips, commissions, bonuses, and hazard pay.

Note that forgivable cash compensation per employee is limited to $100,000 on an annualized basis..

How do I apply for PPP forgiveness?

To apply for PPP loan forgiveness, use the SBA’s Loan Forgiveness Application form, Form 3508. You might be able to use Form 3508EZ or Form 3508S if you meet the eligibility guidelines. Then, submit it to your lender.

How is PPP forgiveness calculated?

Interest for PPP loans is calculated at 1% from the date of loan disbursement. The PPP Forgiveness Estimator is based on the information you provide. It is for information purposes only and is provided based on current government guidance, which is subject to change.

When should I apply for PPP forgiveness?

Borrowers may submit a loan forgiveness application any time before the maturity date of the loan, which is either two or five years from loan origination.

Does PPP count as income?

While a loan does not generate taxable income, a forgiven loan generally does. Congress addressed, to a degree, that issue by specifically stating in the CARES Act that forgiven PPP loans are not includable in taxable income.

Can I get unemployment and PPP at the same time?

It’s possible to take advantage of both programs, but you cannot have both at the same time. If you are collecting unemployment benefits and also have a PPP you are claiming owner compensation replacement from, you should report your PPP loan as income to your state’s unemployment resource.

What utilities are eligible for PPP forgiveness?

The following are all considered forgivable utilities expenses for the PPP:Electricity.Water bill.Gas.Sewage.Telephone (cell phone and landline)Internet bill.Transportation costs.

What expenses are covered under PPP loans?

Eligible Forgivable Non-Payroll Costs include the following: 1) Mortgage Interest, 2) Rent on Lease, and 3) Utilities. 16) What is included in “utility payments”? Utility Payments include the following: 1) water & sewer, 2) electricity, 3) telephone (including cell phone), 4) internet, 5) gas, and 6) transportation.

Can I apply for PPP if I have no employees?

The PPP limits compensation to an annualized salary of $100,000. For sole proprietors or independent contractors with no employees, the maximum possible PPP loan is therefore $20,833, and the entire amount is automatically eligible for forgiveness as owner compensation replacement.

How do I apply for PPP loans?

For example, your liability account could be called a PPP Loan Payable account. Whatever accounts you decide to use, debit your bank account for the amount of the loan and credit your liability account for the amount of the loan. If you separate funds, your bank account will be a special PPP loan bank account.

What are the new rules for PPP loan forgiveness?

Recipients of Paycheck Protection Program (PPP) loans of $50,000 or less will be able to apply for forgiveness using a simplified application that was released Thursday by Treasury and the U.S. Small Business Administration (SBA).

What qualifies as utilities under PPP?

UTILITIES. Utilities are the last qualified expense under the PPP program. These are described by the SBA as phone, internet, gas, water, electricity, etc. Similar to previous qualified expenses, it is important that these service contract agreements predate February 15, 2020.

Can you use PPP to pay yourself?

You can pay yourself back under certain conditions. Sole proprietors, pass-through corporations, and the self-employed may also use the PPP loan/grants to pay themselves their back, current, and future wages during the 8 week period.

What is included in PPP forgiveness?

Payroll costs incurred but not paid during the last pay period of the selected period are eligible for forgiveness if paid on or before the next regular payroll date. Payroll costs include all forms of cash compensation including tips, commissions, bonuses, and hazard pay.

What can PPP be used for?

The PPP loans are administered by the U.S. Small Business Administration (the “SBA”) and originated by third-party lenders. … [1] Proceeds of the loans may be used to pay certain enumerated business expenses, including payroll, employee benefits, rent, utilities, and interest on mortgage and debt obligations.

Can a landlord apply for PPP?

Landlords are not limited to the PPP in seeking aid under the provisions of the CARES Act. … Any business with not more than 500 employees can apply for an EIDL, and the CARES Act provides for $10 billion in additional funds to be used for this program.

What if PPP loan is not forgiven?

Answer: If a PPP loan is not forgiven in full (including if there has been a reduction in the forgiveness amount for an EIDL advance), any remaining balance due on the PPP loan must be repaid by the borrower.