Coronavirus Aid, Relief, and Economic Security Act, established several new temporary programs to address the
The SBA administers the EIDL loan and advance. Taxpayers apply for the EIDL directly on the SBA website. Loan amounts start at $15,000. The SBA has responsibility to administer the Paycheck Protection Program (PPP), and SBA approved lenders provide funding for PPP loans.
EIDL advance was an advance of the EIDL. The amount of the EIDL advance was $1,000 per employee and per owner, up to a max of $10,000. EIDL advance does not have to be repaid. EIDL advance impacts forgiveness of PPP loan.
PPP is a loan designed to provide a direct incentive for small businesses to retain employees. The loan applicant applies for the loan directly from an SBA-approved lender. This loan qualifies for forgiveness based on the use of the proceeds.
Provides additional funding for EIDL and PPP loans. The act changed the rule for the PPP loan so that 60% of the PPP loan must be used for payroll to be eligible for full forgiveness. Borrowers that use less than 60% of the loan for payroll purposes may be eligible for partial forgiveness.