# How is the new PPP loan calculated?

PPP loans are calculated using the average monthly cost of the salaries of you and your employees. If you’re a sole proprietor or self-employed and file a Schedule C, your PPP loan is calculated based on your business’ gross profit (or gross income). Your salary as an owner is defined by the way your business is taxed.

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## Consequently, how do you calculate average monthly payroll for PPP 2nd draw?

The sum of the total monthly payroll costs paid or incurred as of the date on which you apply for the second draw PPP loan, divided by. The number of months in which those payroll costs were paid or incurred, multiplied by 2.5 (borrowers with an NAICS beginning with 72 will multiply by 3.5)

Similarly, how do you calculate FTE for PPP loan forgiveness? *To calculate your FTE, you can use one of the following methods:

1. Enter the average number of hours each employee worked per week, divide by 40, and round to the nearest tenth (maximum, 1.0).
2. Assign a 1.0 for employees who work 40 hours or more per week and 0.5 for employees who work fewer hours.

## Furthermore, how do you calculate loan amount?

Here’s how you would calculate loan interest payments.

1. Divide the interest rate you’re being charged by the number of payments you’ll make each year, usually 12 months.
2. Multiply that figure by the initial balance of your loan, which should start at the full amount you borrowed.

## How do you calculate maximum loan amount?

Maximum monthly payment (PITI) is calculated by taking the lower of these two calculations:

1. Monthly Income X 28% = monthly PITI.
2. Monthly Income X 36% – Other loan payments = monthly PITI.

## How do you calculate monthly PPP payroll?

Locate your annual gross profit net profit on your 2019 Form 1040 Schedule C, line 7 or 31. Divide your annual gross profit or net profit by 12 to calculate your average monthly payroll cost. Multiply your average monthly net profit by 2.5.

## How is PPP second draw calculated?

If payroll is being run, take line 7 and subtract the payroll costs in lines 14, 19, and 26. Use a maximum of \$100,000. Divide this number by 12 and add it to your average monthly payroll expense. Multiply by 2.5 to find your PPP loan amount.

## How is self employed PPP forgiveness calculated?

In order to receive full forgiveness for your PPP loan, self-employed workers need to follow these guidelines: Use at least 60% of your loan to cover “payroll costs,” which for self-employed workers is essentially their salaries (including wages, commission, and tips), up to \$100,000 on an annualized basis.

\$2 million

## What is the average PPP loan amount?

* Overall average loan size is: \$59K.

## What is the PPP calculator?

The SBA.com® PPP Loan Calculator is designed to give you an estimate of the amounts involved in your PPP loan – specifically your estimated maximum loan amount and the estimated forgivable amount of your PPP Loan. The calculator is not designed to cover every unique situation.