[UPDATED at 11:36 a.m. on April 1, 2020: The loan application has been finalized per a press release from the Small Business Administration. All eligible recipients should contact their lenders to confirm the information that the bank will need to process the application. Additionally, the article has been updated to change the calculation of the maximum loan amount to 2.5 times 2019 payroll numbers as stated in the application instructions. It previously stated the amount would be payroll for the trailing 12 months from application.]

The application for the Small Business Administration’s (SBA) groundbreaking Paycheck Protection Program (PPP) is now available from the SBA. Per guidance from the Treasury Department, applications will be open for small businesses and sole proprietorships starting Friday, April 3 and for independent contractors and self-employed individuals starting April 10. This sample application may change, but the SBA suggests businesses review it to become familiar with its contents.


Applications will be made to existing lenders in the SBA 7(a) program or through any federally insured depository institution, federally insured credit union, and Farm Credit System institution that is participating. Applicants must also include a copy of their payroll documentation. Additionally, they will have to certify that:

  • Current economic uncertainty makes the loan necessary to support your ongoing operations.
  • The funds will be used to retain workers and maintain payroll or to make mortgage, lease, and utility
  • You have not and will not receive another loan under this
  • You will provide to the lender documentation that verifies the number of full-time equivalent employees on payroll and the dollar amounts of payroll costs, covered mortgage interest payments, covered rent payments, and covered utilities for the eight weeks after getting this
  • Loan forgiveness will be provided for the sum of documented payroll costs, covered mortgage interest payments, covered rent payments, and covered utilities. Due to likely high subscription, it is anticipated that not more than 25% of the forgiven amount may be for non-payroll
  • All the information you provided in your application and in all supporting documents and forms is true and accurate. Knowingly making a false statement to get a loan under this program is punishable by
  • You acknowledge that the lender will calculate the eligible loan amount using the tax documents you submitted. You affirm that the tax documents are identical to those you submitted to the IRS. And you also understand, acknowledge, and agree that the lender can share the tax information with the SBA’s authorized representatives, including authorized representatives of the SBA Office of Inspector General, for the purpose of compliance with SBA Loan Program Requirements and all SBA


The PPP provides small businesses with nearly immediate relief to the economic crisis caused by the novel coronavirus pandemic and COVID-19. Small businesses (generally defined as having fewer than 500 employees) will have access to up to 2.5 times their average monthly payroll over the trailing 12 month period. Payroll includes group health plan benefits such as medical, dental and vision.

So long as loan proceeds are used to cover payroll costs, mortgage interest (some limitations may apply), rent, and utility costs over the 8 week period after the loan is made and employee and compensation levels are maintained, most of the loan will be forgiven. For more information on the program, see KJK’s summary of what small businesses need to know about the PPP.

The Treasury Department has also issued a Fact Sheet on the program. The Fact Sheet is the first official guidance from the Trump Administration on the PPP following passage of the CARES Act on March 27. Pursuant to the Fact Sheet, PPP loans will bear an interest rate of 0.50% and the loan term will be for 2 years with payments deferred for the first 6 months of the loan term.

As more information is available on the PPP, KJK will continue to update its guidance. KJK clients should contact their KJK attorney for access to our proprietary loan calculator that estimates amounts available under the loan along with what may be eligible for forgiveness.