Businesses are wondering when to apply for a Paycheck Protection Program loan forgiveness; counselors offer advice | Economic news
PPP loans are forgivable if borrowers spend at least 60% of the proceeds to cover staff costs. The rest could be used for expenses like rent and utilities, but even if a business did not meet the 60% payroll requirement, part of the loan could be forgiven.
Businesses that have received loans have up to 10 months to request the forgiveness, counting from the end of the period in which they have used the money, which can be eight or 24 weeks.
Over 80% of small business loans were under $ 150,000, and some lenders and business organizations are urging Congress to streamline the process for forgiving loans of $ 150,000 or less.
Todd Curran, founder and CEO of Richmond-based Savage Apparel Co., a manufacturer of sportswear for amateur athletics such as Ultimate Frisbee, said he plans to apply for a loan cancellation by the end of the month. months, but could wait a little longer.
“I’m trying to do it so I can get it off my plate,” he said. “We followed all the protocols to make him forgive.”
The company obtained a paycheck protection program loan in mid-April and was able to rehire some employees it had laid off. The loan was for eight weeks, and with the money now running out, Curran said he had to downsize again.
“We had hoped the sport would return this fall, but unfortunately the virus has always kept a lot of our customer base from returning to the field,” Curran said, while noting that the company is still open for business and filling. . orders.