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Writer's pictureTaxko Staff

EIDL VS PPP (Second Round): Loan Forgiveness Options - What can effect it?

This video will go over what part of the EIDL and PPP is subject to loan Forgiveness. See how much can be forgiven now: https://aidassist.intuit.com/app/home...



EIDL:

The first $10,000 is a grant. The rest can not be forgiven, it will stay a loan if you do not refinance it over to the PPP.


PPP:

You will owe money when your loan is due if you use the loan amount for anything other than payroll costs, mortgage interest, rent, and utilities payments over the 8 weeks after getting the loan.


Due to likely high subscription, it is anticipated that not more than 25% of the forgiven amount may be for non-payroll costs. You will also owe money if you do not maintain your staff and payroll.


Number of Staff:

Your loan forgiveness will be reduced if you decrease your full-time employee headcount.


Level of Payroll:

Your loan forgiveness will also be reduced if you decrease salaries and wages by more than 25% for any employee that made less than $100,000 annualized in 2019.


Re-Hiring:

You have until June 30, 2020 to restore your full-time employment and salary levels for any changes made between February 15, 2020 and April 26, 2020.


How can I request loan forgiveness?

You can submit a request to the lender that is servicing the loan. The request will include documents that verify the number of full-time equivalent employees and pay rates, as well as the payments on eligible mortgage, lease, and utility obligations.


You must certify that the documents are true and that you used the forgiveness amount to keep employees and make eligible mortgage interest, rent, and utility payments. The lender must make a decision on the forgiveness within 60 days.


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