The new Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act (Otherwise known as Title III) signed into law provides an additional $284.5 Billion of funding into the Paycheck Protection Program (PPP) for businesses with not more than 300 employees. For these loans to be forgiven, they must follow the 60/40 principle with at least 60 percent of the loan amount going towards payroll expenses (salary, wages, tips, employee benefits, etc.) Under the previous regulations, the remaining amount could only be used for qualifying expenses such as mortgage, rent, or utility payments covered under the CARES Act.
However, the new Appropriations Act has expanded the definition of ‘qualifying expenses’ for the next round of PPP loans.
In addition to mortgage, rent, and utilities, the Act provides for the following:
- Covered operation expenditures
- Covered worker protection expenditures
- Covered property damage costs
- Covered supplier costs
Covered operation expenditures are defined as a “payment 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.”
Time Equipment Company has a variety of options available including our All-In-One Payroll with Time and Attendance solution.
Covered worker protection expenditures are defined an “an operating or capital expenditure to facilitate the adaptation of the business activities of an entity to comply with requirements established or guidance issued by the 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. This may include…the purchase, maintenance, or renovation of assets that create or expand…an onsite or offsite health screening capability.”
Time Equipment Company offers new facial recognition scanners with health screening questions to replace touch punch clocks. In addition, we offer new Health Screening Integration software powered by Cordata which tracks employees prior to coming to work while staying in compliance with HIPAA, CDC, OSHA, and state COVID-19 tracking regulations.
The maximum PPP loan amount is $2 million for “second draw” loans.
A borrower may qualify for a loan up to 2½ times its average monthly payroll costs. Businesses in the accommodation and food services industries, such as restaurants and hotels, may receive up to 3½ times their average monthly payroll cost. Click here for additional information on the next round of PPP Loans.
What do I do next?
The best course of action is to contact one of our specialists to review your future needs and get you a quote, so it is included in your PPP loan amount. Remember the loan amount may be forgiven if your ‘qualifying expenses’ are not more than 40% of the entire loan amount with the other 60% going toward payroll costs.
To find ways to take advantage of the new Appropriations Act, contact Time Equipment Company by Email or 800-977-8463.
*This document simplifies complex Acts as it is understood by Time Equipment Company. It is not to be taken as legal advice. The regulations for this program are changing. For further information about the Paycheck Protection Program please visit www.sba.gov or www.coronavirus.gov