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Paycheck Protection Program (PPP)

Program Type: Small Business Assistance Program

Active Period: 2020-2021

Total Assistance Issued: Over $800 billion across multiple rounds

Overview

The Paycheck Protection Program (PPP) was a forgivable assistance program established by the CARES Act to help small businesses keep their workforce employed during the COVID-19 pandemic. Funds could be fully forgiven if businesses used them for eligible expenses, primarily payroll costs.

Key Features

Forgiveness

Funds could be fully forgiven if used for eligible expenses
At least 60% of the funds must be used for payroll costs
Up to 40% could be used for rent, mortgage interest, and utilities
Forgiveness based on maintaining employee and compensation levels

Program Terms

Maximum assistance amount: 2.5x average monthly payroll costs
Interest rate: 1% (if not forgiven)
Repayment term: 5 years (if not forgiven)
No collateral or personal guarantees required
No fees

Eligibility

Eligible businesses included:

Small businesses with fewer than 500 employees
Sole proprietors, independent contractors, and self-employed individuals
Non-profit organizations
Veterans organizations
Tribal businesses
Some larger businesses in certain industries

How to Apply

Note: The PPP program closed to new applications in May 2021. However, if you received PPP funds, you may still be able to:

Apply for forgiveness through your lender
Request reconsideration if your forgiveness application was denied
Contact your lender for assistance with repayment if your funds were not forgiven

Forgiveness Process

To apply for forgiveness:

Complete the appropriate forgiveness application form
Gather required documentation (payroll records, receipts, etc.)
Submit the application to your lender
Lender reviews and submits to SBA
SBA makes final decision on forgiveness