Frequently Asked Questions

Please be advised that the program requirements are subject to change pending additional guidance or rules issued by the SBA. The below highlights of the new program and FAQs are meant to be a non-exhaustive overview and provide applicants only with basic information.

FAQ

A: You can apply for a First Draw PPP Loan until March 31, 2021.
A: Self employed individuals with or without employees, partnerships, S-corporations, C-corps, nonprofit organizations.
A: Generally, businesses that employee less than 300 employees are eligible. News organizations or nonprofit broadcasting entity with NAICS code 511110 or 51 that employ no more than 300 employees per location. Businesses with NAICS code that begins with 72 (accommodations and food service) with more than one physical location and employs less than 300 per location.
A: You can not apply for both 1st draw and 2nd draw at the same time. In order to apply for the 2nd draw you must certify that you have used, or will use, the full amount of the 1st draw PPP loan on or before the expected date on which the 2nd draw loan is disbursed. In addition, the 1st draw loan must have been used for only eligible expenses.
A: As long as the business was in operation on February 15, 2020 you are eligible.
A: A seasonal business will be considered in operation if they it was in operation for any 12-week period between February 15, 2019 and February 15, 2020. A business if it does not operate for more than 7 months in any calendar year or, during the preceding calendar year, it had gross receipts for any 6 months of that year that were not more than 33.33 percent of the gross receipts for the other 6 months of that year. You are ineligible for a PPP loan if: • You are engaged in any activity that is illegal under Federal, state, or local law • You are a household employer (e.g., nannies or housekeepers) • An owner of 20% or more is currently facing formal criminal charges or has been convicted for a felony involving fraud, bribery, embezzlement, or a false statement in a loan application or an application for federal financial assistance within the last five years or any other felony within the last year. • You have ever obtained a direct or guaranteed loan from the SBA or any other Federal agency that is currently delinquent or defaulted within the last seven years. • You received a grant under the Shuttered Venue Operator Grant. • You are a publicly traded company, hedge fund, or private equity firm. • Your business has permanently closed. • Your business is in bankruptcy • You are a business or entity primarily engaged in political activities or lobbying activities • Your organization was created or organized under the laws of the People’s Republic of China or the Special Administrative Region of Hong Kong or with other ties to previously mentioned. Other ties include being owned or held (directly or indirectly) with 20% or more economic interest or having significant operations in the People’s Republic of China or the Special Administrative Region of Hong Kong • Entities that have a member of the board of directors a person who is a resident of the People’s Republic of China. • any person required to submit a registration statement under section 2 of the Foreign Agents Registration Act of 1938 • Entities in which the President, the Vice President, the head of an Executive department, or a Member of Congress, or the spouse of such person owns, controls, or holds at least 20 percent of any class of equity;
A: To be eligible for a 2nd draw PPP loan you must have experienced a revenue reduction of 25% or greater in 2020 relative to 2019. For loans under $150,000 you do not need to show proof of the revenue reduction until you apply for forgiveness. For loan amounts over $150,000 proof is required at the time of applying. Check out the revenue reduction FAQ for 2nd draw loans if you need further assistance.
A: No. You do not need to show that you were rejected for any other loan application to be eligible for a PPP loan. The SBA does not require any collateral or personal guarantees for a PPP loan.
A: There are no fees from the lender or the SBA to apply for a PPP loan.
A: No. PPP loans are not includable in taxable income.
A: No. You must have already received a 1st draw loan to be eligible for a 2nd draw loan. Please refer to the eligibility requirements for 1st draw loans if you have not previously received a PPP loan.
A: No. You are able to apply for a 2nd draw loan as long as you have used (for authorized uses) or will use all of the available funds from the first draw loan on or before the date of disbursement of the 2nd draw loan. You do not need to apply for forgiveness for the 1st draw loan before applying for the 2nd draw loan.
A: If you do not have any employees and showed a loss you are not eligible for a PPP loan. If you have employees and showed a loss you would be eligible to apply using your payroll costs only.
A: No. Only one application per partnership can be submitted. Partners self-employment income should be included on the partnership.
A: You are able to use 2019, 2020 or the last 12 calendar months for the payroll calculations. You will provide relevant documentation supporting your calculation when submitting the application.
A: If you have not filed your taxes you can fill out the relevant forms to get the numbers required for the calculations.
A: Only one PPP application may be submitted per application. Individual partners may not apply for separate PPP loans. Please include partners self-employment income from IRS form 1065 Schedule K in your payroll costs.
A: A seasonal employer may determine its maximum loan amount for purposes of the PPP by using the employer’s average total monthly payments for payroll for any 12-week period selected by the seasonal employer beginning February 15, 2019, and ending February 15, 2020. A borrower is a seasonal employer if it does not operate for more than 7 months in any calendar year or, during the previous calendar year, it had gross receipts for any 6 months of that year that were not more than 33.33 percent of the gross receipts for the other 6 months of that year.
A: Take the sum of the total monthly payments by the borrower for payroll costs paid, as of the date of application, and divide this by the number of months in which payroll costs were paid to get the average monthly payroll costs. Multiple this by 2.5 (3.5 if NAICS 72). The maximum loan amount is the lesser of this calculated amount or $10 million for 1st draw and $2 million for 2nd draw.
A: Our Customer Support team is ready to help and can be reached at info@fundingforward.com or you can give us a call at 718.674.1800 our hours are Sunday to Thursday 9:00 am until 5:00 pm, Friday 9:00 am until 3:00 pm.

1st Draw Forgiveness

A: Once you have used all of the funds from the loan you would need to file for forgiveness with the lender and show that you used the funds properly.
A: You are able to apply for forgiveness once you have used all of the funds from the loan.
A: You are able to apply for forgiveness until the maturation of the loan (5 years from date of disbursement).
A: If you applied for forgiveness within 10 months of the last day of disbursement of the loan you will not have to make any payments before the SBA lets the lender know of the loan forgiveness amount. After you submit the forgiveness application the lender takes this to the SBA for approval. Once the SBA lets the lender know how much, if any amount, is left after forgiveness the lender must notify you of the amount and the due date of the first payment.
A: If you do not apply for forgiveness then payments would be due starting 10 months from the last day of disbursement of the loan amount.
A: The PPP loan comes with a 1% interest rate which starts accruing once the loan is disbursed.
A: 100% of the principal amount and any interest accrued is forgivable as long as the funds are used properly. The number of employees and compensation levels also need to be maintained.
A: For the funds to be considered properly used 60% of the loan amount must be used for payroll expenses and 40% for other qualified expenses.
A: Payroll consists of compensation to employees whose principal place of residence is the United States. It can be in the form of a salary, wages, commissions, tips or similar compensation. Pre-tax contributions made to employee benefits including retirement, group health care, life, disability, vision or dental insurance can also by included.
A: - Mortgage interest payments (but not mortgage principal payments), rent payments, utility payments, interest payments on any debt obligations that were incurred before 2/15/2020, - Covered operations expenditures: payments for any business software or cloud computing service that facilitates business operations, product or service delivery, the processing, payment, or tracking of payroll expenses, human resources, sales and billing functions, or accounting or tracking of supplies, inventory, records and expenses - Covered property damage costs: costs related to property damage and vandalism or looting due to public disturbances that occurred during 2020 that was not covered by insurance or other compensation); - Covered supplier costs: payments made to a supplier for the supply of goods that are essential to the operations of the borrower at the time the expenditure is made and is made in accordance to a contract that is either o in effect before the loan is disbursed to you o or in effect before or during the covered period which is for perishable goods. - Covered worker protection expenditures: costs used to adapt the business activities to comply with requirements/guidance issued by Department of Health and Human Services, the Centers for Disease Control, or the Occupational Safety and Health Administration, or any equivalent requirements established or guidance issued by a State or local government, during the period beginning on March 1, 2020 and ending the date on which the national emergency with respect to the COVID–19 expires. o This may include costs related to creating or expanding a drive-through window facility; an indoor, outdoor, or combined air or air pressure ventilation or filtration system; a physical barrier such as a sneeze guard; an expansion of additional indoor, outdoor, or combined business space; an onsite or offsite health screening capability; personal protective equipment etc.
A: For the purpose of the PPP, only employees whose primary residence is in the United States are eligible. Compensation paid to independent contractors may not be included in payroll calculation as they are able to apply for a PPP loan for themselves.
A: For the purpose of the PPP, you would not include any independent contractors paid in the payroll calculation as they are able to apply for a PPP loan by themselves.
A: The maximum amount you may receive for a first draw PPP loan is the lesser of 10 million or 2.5 months of payroll costs as determined below for your business type.

Additional Questions for 2nd draw

A: If your loan amount is under $150,00 you only need to show the revenue reduction when applying for forgiveness. If the loan amount is over $150,00 you need to show the revenue reduction at the time of application for the loan.
A: You need to show a 25% decline in gross receipts for any quarter in 2020 when comparing that same quarter to 2019. Alternatively, you can also show an annual loss of 25% in gross receipts from 2019 to 2020 to fulfill this requirement.
A: - You may use 1 quarter of Bank Statements in 2019 vs the same quarter in 2020 to prove 25% loss. - OR Quarterly Financial statements -OR applicable tax document which shows Gross Income decreased between 2019 and 2020 (draft 2020 tax documents are not valid).
A: In this case you would be able to compare the gross receipts from the third or fourth quarter of 2019 to any quarter of 2020 to show reduction in gross receipts.
A: In this case, you would compare the gross receipts from the fourth quarter in 2019 to any quarter in 2020 to show the reduction in gross receipts.
A: In this case, you would compare the first quarter of 2020 to the second, third, or fourth quarter of 2020.
A: If less than 60% was used for payroll expenses then the amount that was used for payroll expenses will be considered 60% of the forgivable amount and the remainder would need to be paid back. For example, if you received a loan of $100,000 and only used $50,000 for payroll expenses which is only 50%. Then the $50,000 would be considered 60% of the forgivable amount (50,000 /0.6= $83,333.33) and only $83,333.33 would be forgivable. The remaining $16,666.67 would need to be repaid according to the terms of the loan.
A: The maximum amount you may receive for a 2nd draw loan is the lesser of $2 million or 2.5 months of payroll costs as determined below for your business type.

ADDITIONAL
INFO

  • Self Employed with no employees:
  • ID (for owners with more than 20%).
  •  February bank statement (to show that you were in operation on 2/14/2020)
  • Voided Check (so the lender has your bank information to deposit the funds once loan is approved)
  • Owner Compensation documentation
    • IRS form 1040 Schedule C (line 31 the net profit amount it used in the calculation to determine the loan amount available)
    • Form 1099-MISC (to show nonemployee compensation received)
  • Documents for 25% loss demonstration: only applies second draw Loans of more than 150k
    • 1 quarter of Bank Statements in 2019 vs the same quarter in 2020 to prove 25% loss (up to the borrower which quarter to select)
    • Or Quarterly Financial statements
    • Or applicable tax document which shows Gross Income decreased between 2019 and 2020 (draft 2020 tax documents are not valid)
    • (If the business started in 2020 (prior to 2/15/20), please provide bank statements from 2 consecutive quarters (Q1 and Q2, Q2 and Q3, or Q3 and Q4) to prove 25% loss

  • Self Employed with employees:
  • ID (for owners with more than 20%).
  •  February bank statement (to show that you were in operation on 2/14/2020)
  • Voided Check (so the lender has your bank information to deposit the funds once loan is approved)
  • Owner Compensation documentation
    • IRS form 1040 Schedule C (line 31 the net profit amount it used in the calculation to determine the loan amount available)
    • Form 1099-MISC (to show nonemployee compensation received)
  • Documents for employee payroll demonstration
    • 2019 or 2020 IRS Form 940 (preferred)
    • Or IRS form 941 for all four quarters used in calculation
    • Or “CARES SBA-PPP” document from your payroll provider showing total payroll
    • If used in the calculation: evidence of any retirement and health insurance contributions
  • Documents for 25% loss demonstration: only applies second draw Loans of more than 150k,
    • 1 quarter of Bank Statements in 2019 vs the same quarter in 2020 to prove 25% loss (up to the borrower which quarter to select)
    • Or Quarterly Financial statements
    • Or applicable tax document which shows Gross Income decreased between 2019 and 2020 (draft 2020 tax documents are not valid)
    • (If the business started in 2020 (prior to 2/15/20), please provide bank statements from 2 consecutive quarters (Q1 and Q2, Q2 and Q3, or Q3 and Q4) to prove 25% loss

  • Partnerships
  • Compute payroll costs by adding the following:
  • IRS Form 1065 Schedule K-1 box 14a (net earnings from self-employment of individual U.S. based general partners that are subject to self employment tax) multiplied by 0.9235
    • Capped at $100,000 per partner
  • Gross wages and tips paid to employees which can be computed using 2019 IRS form 941-line 5c-column 1 from each quarter.
    • Subtract any amount paid to any individual employee in excess of $100,000
    • Add any pre-tax employee contributions for health insurance or fringe benefits.
  • Employer contributions for employee health insurance (IRS form 1065 line 19 attributable to health insurance)
  • Employer contributions to employee retirement plans (IRS form 1065 line 18)
  • Employer state and local taxes assessed on employee compensation (IRS form W3 line 17 and line 19)
  • Calculate the average monthly payroll costs (divide the amount from Step 1 by 12).
  • Multiply the average monthly payroll costs amount from Step 2 by 2.5 to get the maximum loan amount.
    •  Businesses with NAICS code 72 use 3.5 multiplier instead of 2.5
  •  Documents you may need:
  • ID (for owners with more than 20%).
  •  February bank statement (to show that you were in operation on 2/14/2020)
  • Voided Check (so the lender has your bank information to deposit the funds once loan is approved)
  • Owner Compensation documentation
    • IRS Form 1065 Schedule K-1
  • Documents for employee payroll demonstration
    • 2019 or 2020 IRS Form 940 (preferred)
    • Or IRS form 941 for all four quarters used in calculation
    • Or “CARES SBA-PPP” document from your payroll provider showing total payroll
    • If used in the calculation: evidence of any retirement and health insurance contributions
  • Documents for 25% loss demonstration: only applies second draw Loans of more than 150k
    • 1 quarter of Bank Statements in 2019 vs the same quarter in 2020 to prove 25% loss (up to the borrower which quarter to select)
    • Or Quarterly Financial statements
    • Or applicable tax document which shows Gross Income decreased between 2019 and 2020 (draft 2020 tax documents are not valid)
    • (If the business started in 2020 (prior to 2/15/20), please provide bank statements from 2 consecutive quarters (Q1 and Q2, Q2 and Q3, or Q3 and Q4) to prove 25% loss

  • S corporations and C corporations
  • Compute 2019 payroll costs by adding the following:
  • Gross wages and tips paid to employees which can be computed using 2019 IRS form 941-line 5c-column 1 from each quarter.
    • Subtract any amount paid to any individual employee in excess of $100,000
    • Add any pre-tax employee contributions for health insurance or fringe benefits
  • Contributions for employee health insurance (portion of IRS Form 1120 line 24 or IRS Form 1120-S line 18 attributable to health insurance)
  • Employer retirement contributions (IRS Form 1120 line 23 or IRS Form 1120-S line 17)
  • Employer state and local taxes assessed on employee compensation (IRS form W3 line 17 and line 19)
  • Calculate the average monthly payroll costs (divide the amount from Step 1 by 12).
  • Multiply the average monthly payroll costs amount from Step 2 by 2.5 to get the maximum loan amount.
    • Businesses with NAICS code 72 use 3.5 multiplier instead of 2.5
  • Documents you may need:
  • ID (for owners with more than 20%).
  •  February bank statement (to show that you were in operation on 2/14/2020)
  • Voided Check (so the lender has your bank information to deposit the funds once loan is approved)
  • Documents for employee payroll demonstration
    • 2019 or 2020 IRS Form 940 (preferred)
    • Or IRS form 941 for all four quarters used in calculation
    • Or “CARES SBA-PPP” document from your payroll provider showing total payroll
    • If used in the calculation: evidence of any retirement and health insurance contributions
  • Documents for 25% loss demonstration: only applies second draw Loans of more than 150k,
    • 1 quarter of Bank Statements in 2019 vs the same quarter in 2020 to prove 25% loss (up to the borrower which quarter to select)
    • Or Quarterly Financial statements
    • Or applicable tax document which shows Gross Income decreased between 2019 and 2020 (draft 2020 tax documents are not valid)
    • (If the business started in 2020 (prior to 2/15/20), please provide bank statements from 2 consecutive quarters (Q1 and Q2, Q2 and Q3, or Q3 and Q4) to prove 25% loss

  • Non-profits
  • Compute payroll costs by adding the following:
  • Gross wages and tips paid to employees which can be computed using 2019 IRS form 941-line 5c-column 1 from each quarter.
    • Subtract any amount paid to any individual employee in excess of $100,000
    • Add any pre-tax employee contributions for health insurance or fringe benefits.
  • Documents you may need:
  • ID (for all officers)
  •  February bank statement (to show that you were in operation on 2/14/2020)
  • Voided Check (so the lender has your bank information to deposit the funds once loan is approved)
  • Documents for employee payroll demonstration
    • 2019 or 2020 IRS Form 940 (preferred) Or IRS form 941 for all four quarters used in calculation
    • Or “CARES SBA-PPP” document from your payroll provider showing total payroll
    • If used in the calculation: evidence of any retirement and health insurance contributions
  • Documents for 25% loss demonstration: only applies second draw Loans of more than 150k
    • 1 quarter of Bank Statements in 2019 vs the same quarter in 2020 to prove 25% loss (up to the borrower which quarter to select)
    • Or Quarterly Financial statements
    • Or applicable tax document which shows Gross Income decreased between 2019 and 2020 (draft 2020 tax documents are not valid)
    • (If the business started in 2020 (prior to 2/15/20), please provide bank statements from 2 consecutive quarters (Q1 and Q2, Q2 and Q3, or Q3 and Q4) to prove 25% loss

Helpful Tips

    • Please complete the application from your desktop computer using the Google Chrome browser, if you don’t have the Chrome browser you can download it here.
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    • When uploading documents, please use the approved formatting (PDF is preferred) and ensure that you upload quality images for faster processing.
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    • If you include your business name with your email inquiry, we can help you much faster.
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    • The banking information you provide will be where your funds go, so please be sure to provide a business account or your bank may reject it.
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    • Please confirm the routing # you include is the ACH routing number or your bank may reject it.