Others who might qualify include non-profit organizations, tribal businesses, or a veteran’s organization that meets the SBA industry size standard (this will vary by industry).
Independent contractors, the self-employed, and sole proprietors can qualify for the Paycheck Protection Program. In other words, you don’t have to pay employees or rent office space to qualify for one of these loans. If you’re a gig worker such as a ride-share driver, nanny, or have a repair or cleaning service, you could qualify as well.
Read more here about how PPP loans work for the self-employed. Uber is offering a comprehensive website for its drivers, available to anyone, on how to apply for a PPP loan; search by your location here.
If you’re still unsure about whether you qualify, Dayan recommends checking the Small Business Association website to make sure you’re eligible.
How Much Can I Get?
The amount you may qualify for depends on your operating and payroll costs. In most cases, your business will be eligible for up to 2.5 times your average costs for payroll. You can calculate these costs using the 2019 or 2020 calendar year, or one calendar year period before you apply for the loan.
There are some exceptions depending on the nature of your business. For instance, if your business falls under the food and accommodation industry (businesses with a NAICS code starting with 72), you may be eligible for up to 3.5 times the average monthly payroll costs.
Other exceptions include sole proprietors, independent contractors and LLC partnerships who don’t have payroll. If that’s you, you can use your gross income (or average monthly distribution for partnerships) to calculate your loan amount, up to 2.5 times your monthly salary.
Applying For the First Draw PPP Loan
If you need a First Draw PPP loan and can meet the eligibility requirements, you’ll need to contact a lender that can work with you. Dayan and Williams say your best bet is to head to the SBA’s Lender Match website to look for a lender in your area.
From there, follow what your lender says. Generally, Dayan says that you’ll need to provide them with documentation showing proof of payroll, your revenue has declined, along with a government-issued ID.
Your Next Steps
The First Draw PPP Loan can be a great way to help your business see the light at the end of the tunnel. Even if you can’t qualify for loan forgiveness, the 1% interest rate is much lower than what you might find with other types of business loans (and especially credit cards). Of course, it’s not for everyone, and you may not qualify, so speak with a lender or look at the SBA website to check.
If you don’t qualify, you can look into alternatives like the Economic Injury Disaster Loan. Through the EIDL, you can borrow up to $2 million. There’s also the Employee Retention Tax Credit if you paid COVID-19 related sick leave.
Otherwise, as soon as you receive your PPP loan proceeds, to make sure your bookkeeping and record keeping are up to date. That way, you’ll have plenty of evidence to prove that you use your funds for qualified expenses, helping you get that much closer to having the loan forgiven Wisconsin car title and payday loan store hours.
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According to the Small Business Association (SBA), if you were in business before , are still open, have no more than 500 employees (per location), and current events have made it difficult for you to sustain your business, then you can qualify.