These questions and answers are a compilation of the participant Q&A from YPTC and Network for Good’s webinar on Feb. 15, 2021.
Why is my lender is asking for 2019 PR amounts on the Round 2 application?
You can use the calendar year 2019 payroll amounts or 2020.
Will there be a minimum staffing requirement for Round 2? We do not have any full-time staff.
I haven’t seen any minimum requirements but staffing level requirements are the same as the first PPP.
When calculating payroll costs for a PPP2 application, do you exclude retirement benefits on salary amounts greater than $100K?
No, we did not come across this as being prohibited in any of the SBA guidance.
For a second draw loan, as an independent contractor who doesn’t have a formal payroll program- can one submit a 2019 schedule C and for 2020 submit invoices to show proof of income or the 1099 which should be coming soon?
Yes, as a self-employed individual you could use IRS Form 1010 Schedule C and provide as documentation copies of 1099 forms and invoices showing you were in business as of 2/15/20. The SBA created a very helpful document explaining the documentation needed to support the revenue reduction. It can be found here: https://www.sba.gov/document/support-second-draw-ppp-loans-how-calculate-revenue-reduction-maximum-loan-amounts-including-what
My understanding is that the base for calculating the max loan amount in PPP2 was ALL of 2019 payroll or ALL of 2020 payroll – average, then 2.5 times?
Yes, in general most borrowers will calculate their maximum loan amount using either calendar year 2019 or calendar year 2020. The SBA released a very handy guide on how to calculate these amounts as well as the 25% revenue reduction. It’s available here: https://www.sba.gov/document/support-second-draw-ppp-loans-how-calculate-revenue-reduction-maximum-loan-amounts-including-what
If we had a reduction of employees in the past, do we have to rehire them in order to qualify for PPP 2?
You do not have to rehire them all in order to qualify for a PPP loan. However, if you pay fewer employees during your loan’s covered period than you did in 2019 or during 1/1/20-2/29/20 then you may have a reduction in the amount of loan forgiveness. Note that there are various exemptions allowed for FTE reductions.
Can you clarify 300 employees or less per location?
For businesses with more than one physical location, the number of employees per physical location is limited to 300 employees. (Note, this refers to a count of all employees, both full-time and part-time. It does not mean a full-time-equivalent count.) For example, if a borrower has 100 full-time employees and 25 part-time employees, the borrower has a total of 125 employees.
Can we include the costs associated with employee reimbursement for health insurance costs under an ICHRA or QSEHRA plan?
Only group health plans are eligible payroll costs. We do not believe a QSEHRA is considered a group health plan. We do not know about an ICHRA. Keep in mind that we are not HR consultants and this answer represents our interpretation of the guidance (which may not be the correct interpretation).
