The CARES Act

The CARES Act, signed into law on March 27, 2020, includes a program (Paycheck Protection Program or PPP) enabling the Small Business Administration (SBA) to provide prompt cash flow relief to small businesses which are suffering due to the coronavirus pandemic.  The relief was provided through forgivable loans to enable employers to continue employment of their workers and sustain wage levels through a specified covered period ending by December 31, 2020.  As the PPP is no longer making loans at present, most borrower activity is focused on submitting applications for forgiveness.  Borrowers whose loans are over $2 million are also preparing for promised loan audits to verify their need for their loans. 

Wilentz attorneys have reviewed the Paycheck Protection Program legislation, its amendments and the updates and related guidance from the SBA in detail and are available to discuss how your business may qualify.  We are working with many of our business clients to address their questions and explore financing, audit and forgiveness possibilities for their businesses, including:

  • During which period of time must I use my PPP loan in order to qualify for forgiveness?
  • What is the result to the Borrower if less than the required percentage of the Borrower’s PPP loan proceeds is used for payroll costs?
  • What types of non-payroll expenses may be paid with PPP loan proceeds?
  • What is the impact to forgiveness if a Borrower finds that an employee is either unable or unwilling to return to work? 
  • Is a Borrower able to terminate employees for cause?
  • Must a Borrower maintain the employment of all workers through the end of 2020?
  • When must a Borrower apply to their lender for forgiveness?
  • For PPP loan amounts that are not forgiven, what are the repayment terms a Borrower can expect?
  • How should the Borrower respond to an audit request?

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