CapitalNOW – Paycheck Protection Program
CraftNOW brings together a variety of capital sources in Philadelphia in this new virtual series
Banner image courtesy of Nick Lenker
Wednesday, April 28, 2021 at 5:30pm (EDT)
Think you’re ineligible for PPP? Think again!
The Enterprise Center demystifies the Payroll Protection Program (PPP) for creatives and shares other business resources available at no cost through their organization. New legislation has given independent contractors and the self-employed greater access to this forgivable loan and The Enterprise Center staff can walk you through the application process.
This program will be led by Elizabeth McGinsky, the Senior Director of Data and Evaluations at The Enterprise Center, a Philadelphia nonprofit whose mission is to serve minority businesses and under resourced communities.
Some Key Facts –
1. It is a “forgivable” loan. As long as you spend it on authorized business expenses (60% paying yourself/payroll and 40% other authorized expenses like rent and utilities) and file for loan forgiveness, you do not have to pay back the loan. If you do not obtain forgiveness, it converts to a loan with a 1% interest rate.
2. There is no credit check. As long as you obtain forgiveness, it will not appear on your credit report.
3. Businesses with Schedule C income (self -employment) are eligible to apply. You do not need to have employees. You do not need to have positive net income, as of 2/22/2021.
4. How much PPP are you eligible for? For your first loan, it is an average monthly payroll x 2.5. If you are a sole proprietor or self-employed, take Line 7 on your Schedule C (gross income), divide by 12, and then multiply by 2.5. The max salary for an individual is $100,000. For instance, if you are a sole proprietor and your gross income was $120,000, you would reduce that to $100,000, divide by 12 ( $8,333) and then multiply by 2.5. $20,833 is the max loan for an individual.
5. Are payroll costs that were incurred before the Covered Period but paid during the Covered Period eligible for loan forgiveness? Answer: Yes. For example, the borrower received its loan before June 5, 2020 and elects to use a 24-week Covered Period. The borrower’s Covered Period runs from Monday, April 20 through Sunday, October 4. The borrower has a biweekly payroll cycle, with a payroll cycle ending on Saturday, April 18. The borrower will not make the corresponding payroll payment until Friday, April 24. While these payroll costs were not incurred during the Covered Period, they were paid during the Covered Period and are therefore eligible for loan forgiveness.
Coming Up –
CapitalNOW will be an ongoing series focused on capital readiness to provide creative entrepreneurs with a working understanding of three key forms of funding – grants, crowdfunding, and financing – and the business readiness required to secure the investments and put them to good use. The goal is for attendees to leave with a deeper understanding of the funding options available to them when the next opportunity or challenge presents itself.
Check back for future dates and presenters.
This program is being organized by CraftNOW and the Creative Business Accelerator, core partners of the new Keystone Alliance for Creative Economies and Entrepreneurship (KACEE).
Questions can be directed to leila.cartier@craftnowphila.org