By Amy E. Ebeling and Mary Ellen Schill
March 31, 2020
The SBA and Treasury moments ago released updated information on the new Paycheck Protection Program created by the CARES Act. The program is specifically designed to help small businesses (less than 500 employees) keep their workforce employed by providing an SBA guaranteed loan. The program also provides for forgiveness of the loan proceeds that are used for payroll costs and other specified operating expenses for the eight weeks following the date of loan origination. The forgiveness of the loan will not be subject to income tax. Other terms of the loan include: interest rate of 0.5%; maturity of two years; first payment deferred for six months; 100% guaranteed by SBA; no collateral; no personal guarantees; and no borrower or lender fees payable to the SBA.
For more information from the Treasury, please click here.
For more information from SBA and the Paycheck Protection Program Application, please click the links below:
- General Information Sheet
- Information Sheet for Borrowers
- Information Sheet for Lenders
- Application Form
Ruder Ware’s COVID-19 Focus Team is doing all we can to keep you up to date as this situation evolves. If you are interested in the Paycheck Protection Program, we encourage you to contact your preferred SBA lender as soon as possible. If you would like a recommendation to a preferred SBA lender or have questions, please contact us.
The content in the following blog posts is based upon the state of the law at the time of its original publication. As legal developments change quickly, the content in these blog posts may not remain accurate as laws change over time. None of the information contained in these publications is intended as legal advice or opinion relative to specific matters, facts, situations, or issues. You should not act upon the information in these blog posts without discussing your specific situation with legal counsel.
© 2021 Ruder Ware, L.L.S.C. Accurate reproduction with acknowledgment granted. All rights reserved.