If you’ve received a PPP Loan, you are eligible for loan forgiveness for the amounts spent on authorized expenses over the appropriate time period.
In general, the PPP Loans used for payroll costs include:
- Salary, wage, commission or similar compensation (with Salary capped at 100K),
- Payment of cash tip or equivalent,
- Vacation, parental, family, medical or sick leave ,
- Allowance for dismissal or separation,
- Payment required for the provision of group health care benefits, including insurance premiums,
- Payment of any retirement benefits,
- Payment of state or local tax assessed on the compensation of employees, (Loan proceeds can be used, as we understand from recent SBA guidance, for paying the employee-withheld taxes attributable to payroll, but not employer-withheld taxes), and.
- Housing stipends and allowances.
For our contractors, this means that PPP Loan forgiveness will only apply to the following on our wage rate sheets:
- Wages
- Vacation
- H&W
- Pension
Please also keep in mind that upon a forgiveness review, the reviewer is going to look to see that you spend the money on the same category of expenses that you used to calculate the original loan amount.