If you’re running a small business, you’ve likely looked into applying for an SBA Paycheck Protection Program loan (SBA PPP loan). This program was newly created as part of the CARES Act, which was passed at the end of March. The PPP is designed to get payroll assistance to small businesses quickly, so the application process is different than applying for other SBA loans.
Keep reading to learn more about what documentation you should have on hand to apply for an SBA PPP loan.
General documents needed for all eligible entity types
- Proof of February Payroll
- Payroll data extract showing wages and taxes paid in February 2020;
- Q1 2020 IRS Form 941; or
- 2020 invoice, bank statement or records proving operation on or around February 15, 2020 if you are self-employed.
- Economic Injury Disaster Loan (EIDL) Loan Agreement, if you have successfully applied for an EIDL loan between January 31, 2020 and April 3, 2020.
Business payroll information you will need
If you have been conducting business for at least a period of 12 months before February 15, 2020, do provide payroll data for 2019 or the preceding 12 months from the date you apply in the suggested formats below.
If you have been in business for at least a period of 12 months before February 15, 2020, do provide 8 weeks of payroll data between February 15, 2019 and June 30, 2019 in the suggested formats below.
If you were not in operation from February 15, 2019 and June 30, 2019, do provide payroll data for all pay periods during which you are in operation in the suggested formats below.
Businesses formed less than 1 year from February 15, 2020
Do provide 8 weeks of payroll data between January 1, 2020 and February 29, 2020 or payroll data for all pay periods during which you are in operation in the suggested formats below.
Suggested ways to show payroll data
Businesses using a professional employer organization (PEO) or similar payroll providers
Do provide the following where available:
- Schedule R (Form 941);
- Allocation Schedule for Aggregate Form 941 Filers attached to PEO’s Form 941;
- Employer’s Quarterly Federal Tax Return; or
- Statement from payroll provider documenting amount of wages and payroll taxes during the relevant period.
For businesses not using a PEO
2019 payroll and tax documents (recommended)
For sole proprietorships without employees
- 2019 IRS Form 1040 – Schedule C; and
- 2019 Form 1099 – MISC detailing non-employee compensation.
For all other eligible entities and Sole Proprietorships with employees, please provide documents from Section A and B:
- 2019 Payroll Report showing the following:
- Salary, wages, commissions, or tips;
- Costs for vacation, parental, family, medical or sick leave;
- Costs for separation or dismissal of employees;
- State & local taxes assessed on employee compensation;
- Itemized list of all Employee Annual Salaries; or
- IRS W2 Forms for all employees who make over $100,000 annually.
Any 1 of the following:
- 2019 IRS Form W-3
- 2019 IRS Form 940
- 2019 IRS Form 944
- Q1 – Q4 2019 IRS Form 941; or
Any of the following, if you do not have the forms above (where applicable to your entity type):
- 2019 IRS Form 1040 ES
- 2019 IRS Form 1040-SR
- 2019 IRS Form 943
- 2019 IRS Form 1065
- 2019 IRS Form 1120
- 2019 IRS Form 1120-S
- 2019 IRS Form 1120-W
- 2019 IRS Form 990.
Other documents you can use
If 2019 Payroll and Tax documents are not available, please provide the following:
- Monthly payroll data; or
- Bank records sufficient to demonstrate the qualifying payroll amount.
OnDeck is here to support small businesses – check out our COVID-19 Resource Hub for more helpful information for small businesses impacted by COVID-19.
*This article has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any financial transaction.