Paycheck Protection Program (PPP) loan forgiveness applications will soon be available by your banking institution. Completing the application accurately, timely, and including the relevant backup documentation determine how much of the loan you must pay back. Below are a few key factors to keep in mind:
- How much did you spend on payroll versus rent, utilities, mortgage interest. You must use at least 60% of proceeds on payroll costs.
- Your must restore FTE (full time equivalent) headcounts and salary/hourly wages by December 31, 2020 to the same levels that were in place at February 15, 2020.
- You must maintain at least 75% of total salary.
There are additional factors to consider, which are driven by when you received your loan, the covered period for which the funds are used (8 weeks or 24 weeks), and governmental restrictions based on your business classification.
Contact Hood Financial for a customized analysis of your PPP loan in order to maximize forgiveness.