Ready to Use PPP Funds to Pay Big Bonuses? Read this First, Washington Business Journal
In an article published on May 19, 2020, Christina Moore provides insight on the Small Business Administration’s fresh loan forgiveness guidance on its Paycheck Protection Program.
The new guidance states that owners, self employed individuals and general partners at firms must record their total weekly pay, and it must be capped at either $15,385 — which is the eight-week equivalent of a $100,000 annual salary — or at the eight-week equivalent of their 2019 compensation, whichever is lower.
According to Moore, the SBA is “basically trying to say, ‘Don’t try to pay yourself richly and try to capture additional funds.” Additionally, that doesn’t necessarily equitably reflect the untold amounts of work and overtime business owners are undertaking to keep their operations running through the Covid-19 pandemic.
“They could pay Sara-handling-takeout a bonus but you can’t pay Harry-running-the-business-and-also-doing-takeout a bonus — it’s a little unfair,” said Moore.
To read the full article, please click here.