The maximum amount of money you can borrow as a first-time PPP borrower is 2.5 times your average monthly payroll costs, up to a maximum of $10 million. That means, for example, if your average monthly payroll in the last 12 months was $100,000, you could borrow up to $250,000.
Correspondingly, can a sole proprietor with no employees get a PPP loan?
For sole proprietors or independent contractors with no employees, the maximum possible PPP loan is therefore $20,833, and the entire amount is automatically eligible for forgiveness as owner compensation share.
In this way, how do I calculate PPP payroll?
You simply calculate all monthly wages (and contribution) for employees, divide by 12, and multiply by 2.5 to get your total PPP Payroll eligibility.
How do you calculate loan amount?
Here’s how you would calculate loan interest payments.
- Divide the interest rate you’re being charged by the number of payments you’ll make each year, usually 12 months.
- Multiply that figure by the initial balance of your loan, which should start at the full amount you borrowed.
The minimum PPP Loan amount is $1,000, and the maximum amount is determined based primarily on the borrower’s payroll-related costs, but cannot exceed $10 million. This amount may be reduced based on loans to a borrower’s affiliated companies.