To fulfill the expeditious intent of providing relief to small businesses, the SBA issued its final rule on 4/2/2020 without the typical 30-day delay for effectiveness. 

We will be discussing the PPP in great detail on Real Estate Investing with Andrew Lieb this Sunday at noon on LI News Radio (WRCN / FM103.9) - If you are in business, don't miss this important segment - it could save your financial life. 

Here is a Summary of the Interim Final Rule found at 13 CFR Part 120: 

• Loan Terms:
• No collateral
• No personal guarantee
• No fees
• Loan payments deferred 6 months (interest accrues)
• 2-year maturity
• 1% interest rate
• Maximum loan $10MM
• Loan Amount (calculation methodology):
1. Aggregate payroll costs from last 12 months
2. Subtract amounts paid to employee over $100K
3. Divide net of steps 1 & 2 by 12
4. Multiply step 3 by 2.5
5. Add outstanding amount of an Economic Injury Disaster Loan made from 1/31/2020 to 4/3/2020 less advances
• Loan Forgiveness Availability:
• Employees are on the payroll for 8 weeks 
• Money used for payroll, rent (lease dated before 2/15/2020), mortgage interest (obligation incurred before 2/15/2020), or utilities (service agreement before 2/15/2020)
• 75% of loan forgiven must be used on payroll
• Payroll includes:
• Small business = Salary, wages, commission, cash tips, vacation / parental / family /medical / sick leave, allowance for separation / dismissal, employee benefits (health / retirement), state / local employment tax
• Independent Contractor = wage, commission, income, or net earnings
• Payroll doesn’t include: 
• Employee with principal residence outside US
• Salary over $100k (prorated)
• Fed employment tax from 2/15/2020 to 6/30/2020
• Qualified sick & family leave wages
• To prove proper payments, lenders can rely on borrower’s documentation without any verification requirements
• Application:
• SBA Form 2483 (lender submits SBA Form 2484)
• Applicant certifies that “[c]urrent economic uncertainty makes this loan request necessary to support the ongoing operations of the applicant.
• Available from 4/3/2020 to 6/30/2020 or until exhausted
• Borrower can only get 1 loan
• First-come, first service
• E-signature / consent permitted
• Eligibility:
• Must be small business, non-profit, independent contractor (sole proprietor)
• Must have < 500 employees (certain exceptions if bigger) with principal place of residence in US
• Must be in operations on 2/15/2020 with W2 employees
• Must submit proof of eligibility of:
• Payroll processor records
• Payroll tax filings
• Form 1099-Misc
• Income & expenses for sole proprietorship
• If don’t have above, bank records to demonstrate qualifying payroll
• Ineligibility:
• You are engaged in illegal activity under federal, state or local law (no legal marijuana) 
• Household employer of nannies / housekeepers
• Owner of 20% or more is incarcerated, on probation / parole, subject to indictment, criminal information, arraignment, or convicted of felony in last 5 years
• Delinquent / defaults on SBA loan within last 7 years
• Misuse Penalties:
• Knowingly using loan for unauthorized purposes is fraud
• False statements on application is up to 5 year imprisonment / up to $250K fine + up to 2 years imprisonment / up to $5K fine + up to 30 years imprisonment / up to $1MM fine
• Lenders Fees Paid from SBA:
• 5% of loans up to $350K
• 3% of loans over $350K & less than $2MM
• 1% of loans at least $2MM  
• Agent Fees Paid by Lender from its Fees:
• 1% of loans up to $350K
• 0.5% of loans over $350K & less than $2MM
• 0.25% of loans at least $2MM