PPP Loans: Eligibility

April 6, 2020

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Video Transcription:

Who can use the PPP loan and what can it be used for? First, any business, you must have a federal ID number or you can use your social security number. If you’re a sole proprietor. Sole proprietors including independent contractor and eligible self-employed individuals. The law references these, but there is no real difference between those. Also, nonprofit organizations that are recognized by the IRS as a 501(c)(3), none of the other 501c organizations are eligible for PPP loans. In criteria, you must have less than 500 employees and be in operation on February 15th of 2020 what can the funds be used for? What are the allowable uses? First off, payroll costs. We’ll discuss this in the other video and look at a worksheet of how to calculate this and what all is included. It is quite extensive. Secondly, the continuation of group health insurance benefits or group health benefits including insurance. You may also include payments of interest on mortgage obligations. There can’t be any prepayments and principal is not included. Interest-only, rent and utilities, and all of those items for mortgage obligations. Rent and utilities must have been in a lease agreement or incurred before February 15th of 2020 so that means you can’t go out and get new loans or new leases and use PPP funds to pay for those.

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