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Loan Forgiveness and the Payroll Protection Program

Payroll Protection Program

Miami-Dade County Chamber of Commerce provides all the information you need for the Payroll Protection Program

On April 28, the Miami-Dade County Chamber of Commerce released information about loan forgiveness within the Payroll Protection Program (PPP), which is a loan program designed to provide an incentive for small businesses to keep their workers employed during this pandemic. 

The loan aims to provide economic relief to businesses, due to the COVID-19 pandemic which has increased financial hardship by forcing some businesses to close temporarily.

The loan can be applied for at any lending institution that has been approved by the United States Small Business Administration (SBA) lenders. These institutions include the banks you use, a bank near you, and even many community banks. In order to find an approved lender, you can call your bank or use SBA’s online lender match tool. 

In addition, the loan money can be used for rent, mortgage, interest, or utility payments, and registration is open until June 30. Eligible businesses include small businesses with 500 employees or less or businesses that have an SBA employee-based size standard of higher that 500 employees. 

Further, restaurants, hotels, and other businesses in the North American Industry Classification System (NAICS) under the “Accommodation and Food Services” with 500 or less employees are eligible. Nonprofits and tribal businesses are also eligible. Finally, sole proprietors, independent contractors, gig economy workers, and self-employed individuals are eligible. 

The SBA’s franchise directory has a detailed list of eligible franchises.

The loan can be applied until June 30 and it covers eight weeks of payroll expenses and other payments towards debt. The funds will be 250 percent of the average monthly payroll expense of your business, with a maximum of 10 million dollars total. 

The entire loan will be forgiven if all employees are kept. However, if any employees are laid off, the forgiveness will be reduced by the percent decrease in the number of employees. The loan will be forgiven at the end of the eight-week period after taking out the loan. 

For reference, payroll costs include employee salaries of up to $100,000 annually, hourly pay, cash tips, medical leave, and group health insurance premiums. 

The maximum term of the loan is 10 years. This term amount has an interest rate that is capped at four percent and the loan is 100 percent guaranteed by the SBA. There will be no fees to pay on the loan, collateral requirements, or personal guarantees. In addition, loan payments will be deferred for anywhere from six months to one year, starting when the loan was taken out. 

The funds from the loan will be made available within three days after successfully applying. Businesses can register here.

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