Earlier this year, the U.S. Treasury Department reopened the Payment Protection Program (PPP), the agenda for business owners needing assistance due to the pandemic. The reopening of the PPP couldn’t have come any sooner. If your business has taken advantage of the program, then you need to know how to have the loan forgiven!
This year’s loans can be used for payroll costs, benefits to employees, mortgage interest, rent, utilities, and worker protection costs related to COVID-19. The PPP will be accepting applications until March 31st, 2021.
Business owners in Alamo may be eligible for a PPP loan if they have over 300 employees or can show at least a 25% loss in gross receipts between comparable quarters from 2019 to 2020. A borrower may be eligible for a second PPP loan if they have or will use all funds from their first loan.
How do I Qualify for Forgiveness?
Whether your business is a first- or second-time recipient of the PPP, it may qualify for loan forgiveness if during the eight to 24-week period following loan distribution:
- All employee and compensation levels were maintained.
- All funds were spent on eligible expenses with at least 60% being used on payroll costs.
- Second-time borrowers maintained employee and compensation levels equal to those during the first loan.
- All funds were used until the maturity of the loan.
Which Forms Do I Need?
Before applying for loan forgiveness, be sure to have all proper documentation. The lender has to notify the borrower of the forgiveness amount and the date on which your first payment is due.
You will need the following documents:
- SBA Form 3508, SBA Form 3508EZ, or SBA Form 3508S. Your lender should have these.
- All payroll and tax forms for the eight to 24-week coverage period.
- All payments, receipts, or account statements documenting any employer contributions to employee benefits that were included in the loan fund.
- A copy of the borrower’s mortgage receipts and payment schedule.
- A copy of the borrower’s lease agreement and receipts.
- Copies of invoices and receipts of payments for utilities and eligible expenses.
Learn More by Contacting the Alamo EDC!
Economic development near McAllen is on the rise, so don’t let your business fall behind! Find out how we can help with our business incentives by contacting our office today!