The Small Business Administration and the U.S. Department of Treasury confirmed ABC’s interpretation of the Paycheck Protection Program Interim Final Rule and addressed this issue in a release of FAQs for lenders and borrowers. Importantly, this document clarifies that businesses do not have to qualify as both a small business concern and have 500 or fewer employees. ABC continues to urge eligible members in need to apply for PPP loans.
The FAQs further state that borrowers and lenders may rely on the guidance provided in this document as SBA’s interpretation of the CARES Act and of the Paycheck Protection Program Interim Final Rule. The U.S. government will not challenge lender PPP actions that conform to this guidance, the PPP Interim Final Rule and any subsequent rulemaking in effect at the time.
Read the FAQ that specifically addresses this issue below.
Question: Does my business have to qualify as a small business concern (as defined in section 3 of the Small Business Act, 15 U.S.C. 632) in order to participate in the PPP?
Answer: No. In addition to small business concerns, a business is eligible for a PPP loan if the business has 500 or fewer employees whose principal place of residence is in the United States, or the business meets the SBA employee-based size standards for the industry in which it operates (if applicable). Similarly, PPP loans are also available for qualifying tax-exempt nonprofit organizations described in section 501(c)(3) of the Internal Revenue Code (IRC), tax-exempt veterans organization described in section 501(c)(19) of the IRC, and Tribal business concerns described in section 31(b)(2)(C) of the Small Business Act that have 500 or fewer employees whose principal place of residence is in the United States, or meet the SBA employee-based size standards for the industry in which they operate.