UPDATED April 9, 2020
The Coronavirus Aid, Relief and Economic Security (CARES) Act passed on March 27, 2020, introducing a number of benefits for individuals and small businesses.
One benefit for small businesses and their workers comes in the form of Small Business Administration (SBA) 7(a) Relief Loans offered under the Paycheck Protection Program (PPP).
In short, this program will provide loans to small businesses to cover payroll and other specific expenses for an eight-week period. If the proceeds from these loans are used to pay qualifying expenses, the loans could ultimately be forgiven with no repayment by the recipient. For more information on these loans, click here.
In the last week, there has been some additional guidance issued from the AICPA and the U.S. Treasury.
This communication from the AICPA is intended to provide a collaborative opinion on documentation needed by lenders and how certain expenses included in the PPP definition of payroll costs should be calculated and supported.
The U.S. Treasury Q&A, which will continue to be updated, will serve as the Treasury/SBA’s way of issuing additional guidelines without another formal interim rule document.
We expect there will be a substantial number of small businesses interested in filing for PPP loans. To assist in this process, HORNE is working with clients to streamline your business’s information input process and expedite the review/approval process for faster funding.
Obtaining loan proceeds under the PPP will be a win for small businesses looking to retain their employees as we continue to maneuver uncertain times. However, the real stimulus will be received once the loan proceeds are forgiven.
HORNE will walk you through the entire process — including information gathering, loan application and origination, and, most importantly, walking you through the exact steps required to achieve loan forgiveness.
Sourcing banks to house these loans is going to become increasingly difficult. If you need a local resource, the SBA has a lender search tool here. The Federal Reserve also announced that it will step in to help support the Paycheck Protection Program by making it easier for banks to lend to smaller companies.
In addition to the PPP, we are assisting clients with other provisions included in the CARES Act. If you have questions or would like assistance to find opportunities in any of these other provisions, please contact us.