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Here is the latest information to help CPAs as they assist small businesses. (UPDATED: April 15, 2020)

The SBA issued additional guidance for the Paycheck Protection Program, on Tuesday, April 14, and it specifically addresses the often-asked question of how self-employed and partner income should be included in the loan application.

The new guidance discusses loan amounts and loan forgiveness calculations for individuals with self-employment income (with and without employees).

Additionally, the guidance clarifies that the self-employment income of general partners may be reported as a payroll cost, up to $100,000 annualized, on a PPP application filed by or on behalf of the partnership (and LLC filing taxes as a partnership).

Here are links to the Journal of Accountancy article and the SBA interim rule guidance.

The SBA also updates its FAQs at this link (April 14).

Find more updates at the AICPA COVID-19 Resource Center.


April 7, 2020

The SBA has released FAQs about the Paycheck Protection Program, the $349 billion small business relief program that is a key part of the Coronavirus Aid, Relief and Economic Security (CARES) Act, P.L. 116-136.

Here is the SBA PPP FAQ link for the six-page documents and its 18 items.

“These clarifications are going to have a significant impact in the total eligible funding amount available to small businesses,” according to this Journal of Accountancy article.

The clarity aligns with many AICPA recommendations, such as:

  • Using the Gross Payroll approach for both loan application and forgiveness – the guidance also clarifies that employer FICA should not be included
  • The $100,000 salary limitation does not include healthcare, retirement benefits, and state and local taxes.
  • Applicants who use Professional Employer Organizations (PEOs) can provide payroll reports since they cannot produce individual entity payroll tax documents
  • Time period to calculate payroll costs for maximum loan amount

The AICPA’s Paycheck Protection Program Resource Center houses resources and tools produced by the AICPA to help address the economic impact of the Coronavirus. 

For further reporting on how CPAs can handle challenges related to the Coronavirus, visit the JofA’s Coronavirus Resources Page.