Since launching into action last Wednesday, the Utah Economic Task Force Rapid Response Team (RRT) has helped more than 1,000 Utah companies find solutions to Covid-19 business challenges. The RRT, which is comprised of 50+ local volunteers, has identified the top 4 frequently asked questions to share with the business community.
To receive assistance from the RRT, go to coronavirus.utah.gov/business and submit a help request. Someone from the team will follow up to not just pass along information, but to solve problems and provide solutions for your business.
Question 1: What qualifies as “payroll costs?”
Answer: Payroll costs consist of compensation to employees (whose principal place of residence is the United States) in the form of:
- Commissions, or similar compensation
- Cash tips or the equivalent (based on employer records of past tips or, in the absence of such records, a reasonable, good-faith employer estimate of such tips)
- Payment for vacation, parental, family, medical, or sick leave
- Allowance for separation or dismissal
- Payment for the provision of employee benefits consisting of group health care coverage, including insurance premiums, and retirement
- Payment of state and local taxes assessed on compensation of employees
- And for an independent contractor or sole proprietor, wage, commissions, income, or net earnings from self-employment or similar compensation.
Question 2. Is there anything that is expressly excluded from the definition of payroll costs?
Answer: Yes. The Act expressly excludes the following:
- Any compensation of an employee whose principal place of residence is outside of the United States, including J-1 and H2A workers.
- The compensation of an individual employee in excess of an annual salary of $100,000, prorated as necessary.
- Federal employment taxes imposed or withheld between February 15, 2020 and June 30, 2020, including the employee’s and employer’s share of FICA (Federal Insurance Contributions Act) and Railroad Retirement Act taxes, and income taxes required to be withheld from employees.
- And qualified sick and family leave wages for which a credit is allowed under sections 7001 and 7003 of the Families First Coronavirus Response Act (Public Law 116–127).
Question 3: Where can I apply for the Paycheck Protection Program?
Answer: You can apply for the Paycheck Protection Program (PPP) at any lending institution that is approved to participate in the program through the existing U.S. Small Business Administration (SBA) 7(a) lending program and additional lenders approved by the Department of Treasury.
This could be the bank or credit union you already use, or a nearby bank or credit union. There are thousands of financial institutions that already participate in the SBA’s lending programs, including numerous community banks.
You do not have to visit any government institution to apply for the program. The Utah Bankers Association posted a list of banks authorized to assist businesses here. Utah’s Credit Unions posted a similar list here. You can also find SBA-approved lenders in your area through SBA’s online Lender Match tool.
Having a hard time finding a lender? Reach out to the RRT. They can provide examples of specific lenders that are accepting applications from any Utah small business. Need additional help? You can call your local Small Business Development Center and they will provide free assistance and guide you to more lenders in your community.
Question 4: If I get an EIDL and/or an Emergency Economic Injury Grant, can I get a PPP loan?
Answer: Yes! Whether you’ve already received an EIDL unrelated to COVID-19 or you receive a COVID-19 related EIDL and/or Emergency Grant between January 31, 2020 and June 30, 2020, you may also apply for a PPP loan.
If you ultimately receive a PPP loan or refinance an EIDL into a PPP loan, any advance amount received under the Emergency Economic Injury Grant Program would be subtracted from the amount forgiven in the PPP. However, you cannot use your EIDL for the same purpose as your PPP loan. For example, if you use your EIDL to cover payroll for certain workers in April, you cannot use PPP for payroll for those same workers in April, although you could use it for payroll in March or for different workers in April.
Information on Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) can be found here. If you have questions regarding the SBA Paycheck Protection Program, the SBA Economic Injury Disaster Loan program, or other programs on this page, please submit a help request to the Utah Economic Task Force Rapid Response Team.