The new stimulus bill that was signed on Friday, March 27, 2020, known as the CARES Act is a massive and far ranging $2+ TRILLION bill, so it is probably best for us to break it down by sections or likely impacted group.  This Act may be cited as the “Coronavirus Aid, Relief, and Economic Security Act.”  This post will cover a small business loan program called the Paycheck Protection Program or “PPP”.

3/31 Update:  We want to draw your attention to this post as well: New Treasury Guidance on 3/31 for PPP

The program provides loans for small businesses.  The two qualifying factors are the business must generally have 500 employees or less, have payroll cost, and was in operation as of February 15, 2020.  The maximum loan amount under this program is 2.5 times the monthly average of the prior 12 months payroll cost. If certain conditions are met and the funds are used for qualifying expenses during an 8 week period beginning on the day the loan is funded, the loan will convert to a grant and will be forgiven. The Treasury will be issuing further guidance in the coming days and the program is expected to be operational very soon. This new program is designed to allow you to keep as many of your employees on the payroll even if your operations are severely limited or closed for a period.

The US Chamber of Commerce has a great informational piece that explains the PPP well.

JMF Paycheck Protection Program Summary PDF

Needs List

You will need the following to calculate your maximum loan amount:

  1. Payroll reports by month (in total and by employee) for 2019, indicating which employees are full-time and which are part-time
  2. Payroll reports by pay period (in total and by employee) for January-March of 2020, indicating which employees are full-time and which are part-time.
  3. Compensation to any one employee in excess of $100,000 for the prior 12 months
  4. Copies of quarterly 941 reports and state unemployment reports for all of 2019 and Q1 2020
  5. Copy of 2019 940 report
  6. 2019 W-2s for all employees
  7. Payments for group health benefits, including insurance premiums, from April 1, 2019 to March 31, 2020
  8. Payments to or income of a sole proprietor or independent contractor that is a wage, commission, income, net earnings from self-employment, or similar compensation from April 1, 2019 to March 31, 2020
  9. 1099s for 2019 for independent contractors that would otherwise be an employee of your business.
  10. Document the sum of all retirement plan funding that was paid by the Company Owner (do not include funding that came from the employee’s out of their paycheck deferrals).
    • Include all employees, including company owners.
    • 401K plans, Simple IRA, SEP IRAs.

If you would like us to help your business with this new program, please reach out to your JMF accountant or simply send an email to

Other Related CARES Act Blog Posts: