Small Business Paycheck Protection Program
Last updated on 3/25/2021
The SBA Paycheck Protection Program (PPP) can be used to help fund payroll costs, including benefits. Funds can also be used to pay for mortgage interest, rent, utilities, worker protection costs related to COVID-19, uninsured property damage costs caused by looting or vandalism during 2020, and certain supplier costs and expenses for operations. At this time Nutmeg State FCU is no longer taking applications for this program.
Features of the Paycheck Protection Program
Small businesses with 500 or fewer employees—including nonprofits, veterans organizations, tribal concerns, self-employed individuals, sole proprietorships and independent contractors—are eligible for the Paycheck Protection Program. Businesses with more than 500 employees are eligible in certain industries. PPP loan forgiveness is based on the rehiring of employees and maintenance of salary levels. Forgiveness will be reduced if the full-time headcount of your business declines or if salaries and wages decrease.
Fully Forgiven Terms
First or Second Draw PPP Loans made to eligible borrowers qualify for full loan forgiveness if during the 8- to 24-week covered period following loan disbursement:
- Employee and compensation levels are maintained;
- The loan proceeds are spent on payroll costs and other eligible expenses; and
- At least 60 percent of the proceeds are spent on payroll costs.
Second Draw Terms
A borrower is generally eligible for a Second Draw PPP Loan if the borrower:
- Previously received a First Draw PPP Loan and will or has used the full amount only for authorized uses;
- Has no more than 300 employees; and
- Can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020
Questions on how to use your PPP Loan or Applying for forgiveness? Our PPP Webinar Playlist can help you understand the program in more detail.