Manage episode 261480999 series 2518941
In this episode I will answer the 10 most frequently asked questions I have received from business owners regarding the Paycheck Protection Program.
Can I use loan proceeds to hire new staff? The answer is no, you must maintain current employment levels or re-hire employees laid off or furloughed and use 75% of loan proceeds on payroll.
Can I use loan proceeds to pay my primary residence loan payment if I am a home based business? The answer is no, loan proceeds are to be used to pay commercial leases and mortgage interest on commercial loans. In the interim you may request forbearance from your residential lender.
Can I use loan proceeds to make tenant improvements to my commercial building? The answer is no, Tenant improvements are not an allowable PPP loan use.
Will my bank take responsibility if I completed my PPP loan application incorrectly? The answer is no, the federal government has given the Bank immunity from responsibility related to the completion of your PPP application.
Can marijuana related businesses receive PPP loan proceeds? The answer is no, the manufacturing or distribution of Marijuana is illegal at the federal level and therefore businesses engaged in one or more of these activities are not eligible to receive PPP loan proceeds.
Can I use loan proceeds to buyout a partner or acquire a new business? The answer is no, PPP loan proceeds are to be used to maintain your business through a difficult time, not facilitate growth strategies.
Can I use loan proceeds to fund my marketing campaign? The answer is no, you cannot use funds for marketing purposes.
Can I be prosecuted for lying on the PPP loan application? Yes, the Department of justice is currently reviewing loan applications for any information therein that is considered to be misleading or fraudulent for future prosecution.
What happens if I don’t use all of my loan proceeds? You may either retain unused proceeds that turn into a loan or return unused funds to the bank during or after the eight week period.
What if I don’t have any work for my employees? You must rehire and pay your employees per the specifications detailed in the PPP loan legislation regardless if you have work for them or not.