On Thursday August 27, 2020 the Treasury department issued further guidance about PPP Forgiveness that may impact you. The guidance included FAQ’s that relate to owners and non-payroll costs.
To summarize and put it in simpler terms they stated the following:
- Owner-employees (S-Corp/C-Corp) – Are not subject to the Owner Limitations if they have less than a 5% ownership.
- Home-based businesses – No household expenses are eligible for PPP Loan Forgiveness.
- Shared business operations – Subleasing part of your business space to another tenant requires the rent, mortgage interest, and utilities to be prorated by the percent of space used.
- Self-Rentals (or renting from a related party) – The amount of rent/lease eligible for forgiveness cannot be greater than the mortgage interest that is paid during the loan covered period. Lenders will be required to have Mortgage Interest Statements and the mortgage must have been in place prior to 2/15/20.
You can check out the full FAQ’s here
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