Bruce Claassen

April 2, 2020

The Department of the Treasury and Small Business Administration (SBA) have made some changes to a few features of the Paycheck Protection Program Loans  (PPPL).   

Interest rate

In the original law, the interest rate was capped at 4%.  A couple of days ago, the Department of Treasury updated the maximum rate to 0.5% (yes, that is a decimal in front of the five (5)).  Today, they issued new guidance updating the maximum interest rate to 1%.

 

Payroll costs

In the original law, there was some confusion as to whether you could include payments made to certain independent contractors in your payroll costs when determining your maximum loan amount.   Later guidance from the Treasury Department clarified that you indeed could under certain circumstances.  

Today's guidance seems to state that no independent contractor payments can be included when calculating your average monthly payroll.  

 

We anticipate more updates and changes as things continue to be clarified.  There are still many unanswered questions, but the government's mission to get money in your hands is still forging ahead.  

 

You can follow the changes on our COVID-19 landing page here.

 

We also have an updated SBA loan summary here.