New Rule, Applications for Paycheck Protection Program (PPP)

New Rule, Applications for Paycheck Protection Program (PPP)

Last night, the Small Business Administration issued an Interim Final Rule designed to provide further clarification on the PPP. 

Among other things, the Rule clarifies the computation of payroll costs. Specifically, the following costs are not included when computing payroll costs for the initial loan application and for loan forgiveness. 

Federal employment taxes imposed or withheld between February 15, 2020, and June 30, 2020, including the employee’s and employer’s share of FICA and Railroad Retirement Act taxes; and income taxes required to be withheld from employees. 

Bottom line: all the federal taxes imposed or withheld during the 12 months prior to the loan may be included in payroll costs, except for the period shown above. 

In addition, the SBA last night issued new Borrower Application and Lender Application.forms For other information on the PPP, see the SBA’s PPP webpage. 

NADA is working with SBA to address several PPP issues and intends to issue a PPP FAQ later today.