Richard A. Huffman, CPA, MST
Tax Partner
The Small Business Administration has released additional Paycheck Protection Program (PPP) guidance and revised the forgiveness application form to align with the Paycheck Protection Program Flexibility Act which was signed into law on June 5, 2020. Highlights of the updates are as follows:
1. For non-owners included compensation is 24 weeks of compensation up to $100,000 with a maximum per employee amount of $46,154.
2. For owners (S and C corporation owner-employees, self-employed individuals and general partners) the included compensation is the lesser of 2.5 months of 2019 compensation or $20,833.
3. Employer paid health insurance is only included for non-owners, excluded for all owners.
4. Employer paid retirement plan contributions are included for employees (including S and C Corporation owner-employees) but excluded for self-employed individuals and general partners.
5. Clarified that if less than 60% of the loan proceeds are utilized for payroll costs, the amount qualifying for forgiveness will be incrementally reduced.
6. There is a new EZ application for forgiveness that requires fewer calculations and can be utilized if meet certain criteria.
If you have not yet applied, PPP funds are still available with an application deadline of June 30, 2020.
For additional information or guidance regarding the Paycheck Protection Program, please contact your WFY advisor or contact us here.
© Copyright 2020. All rights reserved.