Best Practices
Survival Tip #4: Answers to Your Top PPP Loan Questions
Thousands of restaurant owners are applying for the forgivable loans provided by the Paycheck Protection Program (PPP). However, there is still much confusion about the application process, how funds can be used and loan forgiveness.
We received several hundred questions during last week's webinar on the PPP. Of those, the three most asked about topics were:
Q: What happens if I cannot reopen my restaurant during the 8-week forgiveness period?
A: The forgiveness amount is not based upon whether or not you are open. It only applies to how much you spent on eligible payroll costs, rent, utilities and mortgage interest during the 8-week period.
It's not just about ideas. It's about making ideas happen.
- Author Unknown
Q: What may I use the loan funds for?
A: Loans fund may only be used to pay eligible expenses (payroll costs, utilities, rent and mortgage interest) during the 8-week period following the loan origination date, which has been defined as the date you receive funding.
Q: May I include owner's draws as part of payroll costs?
A: The PPP does not allow owner's draws or distributions to be considered a part of payroll costs. It does provide the opportunity for sole proprietors and independent contractors to use previous earnings when calculating eligible loan amounts.
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April 2020 Restaurant Startup & Growth
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