5 Tips for PPP Loan Forgiveness
After studying the federal program, Industry Week’s Ethan Karp offers tips to attain loan forgiveness in the COVID Payroll Protection Plan.
The article contains more details, but here are the five hints:
1. The covered period of potential forgiveness begins on the day you get your money and lasts for eight weeks. Here, you have options on how to proceed…
2. Establish separate ledger accounts for expenses to track that you are using PPP dollars for the allowable payroll (up to a pro-rated $100k cash compensation per employee), mortgage interest, rent, benefits, and utilities.
3. Some lawyers recommend separating paychecks for those employees who make over $100K so that they get their over-$100K portion of their salary separate from the under-$100K portion—again, so that it is tracked easily.
4. Save all documentation regarding how the funds are expended including invoices, cancelled checks, payment receipts, payroll reports, transcripts of accounts, etc.
5. There is a line in the bill that references that eligible forgiveness will come from “costs incurred and payment made during the covered period payroll costs.”
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