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New Government Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL)

EFGI Client:


Here is some current information on how to get tax free helicopter from the new Government PPP plan and a separate EIDL loan from the the SBA. With regard to the PPP, the available amount is computed as follows.  Add the last (4) quarters of 941’s, plus any 1099 payroll, plus any “payroll” distributions subject to a max limit of $100K per person. Then divide that number by 12 and multiply times 2.5. That’s how much tax free money is available to each small business under 500 employees. Loan proceeds must be spent on pretty much any operating expense by June 30th. The government wants you to spend, spend, spend!  This would include debt service as long as the debt was incurred prior to 2/15/2020. The structure is a (10) year note from the SBA at 4% with no payments for the first six months and no personal guarantees. However, you can apply for “Note Forgiveness” as soon as you spend the amount of the loan. So the (10) year term and 4% rate would only apply to any unspent amount after June 30th. This is truly helicopter money for small businesses. The application process is super streamlined.


The EIDL is a separate program. It is also through the SBA. Loan amounts are up to $2M at 3.75% interest for up to a (30) year term. Information on both programs is attached for your review. Our first recommendation is to click on the LiveOak Bank link below and register in the queue. Live Oak Bank is the largest SBA provider in the USA as well as a platinum partner with CAA. They will work you PPP application in queue order. So, do it now! Second recommendation is to apply for the EIDL online. I hope this information is helpful to you.