The deadline to apply for a first- or second-draw PPP loan is March 31, 2021.
As part of the CARES Act, the Paycheck Protection Program (PPP) aims to help you keep your people employed and on payroll.
Eligible small businesses (fewer than 500 employees, per the Small Business Administration size standards and affiliation rules) can borrow up to 250% of their average monthly payroll, up to an aggregate total of $10 million, in order to sustain their business.
The American Rescue Plan (ARP) signed in March 2021 replenishes the PPP loan program with an additional $7.25 billion for small businesses seeking a first- or second-draw loan.
The new law also authorizes special access to first- or second-draw PPP loans for certain nonprofit organizations and internet-only news and periodical publishers with 500 employees or less per physical location.
As part of the application for this loan, companies must provide their lenders with their average monthly payroll costs.
We’ve created a report that will help you prepare and calculate this information, you can also go to Company > Reports to find the report.
Once you click into the report, you'll see the different options of date ranges (explained below), as well as information about form 941 and PEO Letters. You'll also see options for a more detailed report, as well as one that more easily pulls into PDF format.
What is and isn’t included in the report?
The guidance from the Treasury Department specifies that payroll costs, including employee salary and wages up to an annualized amount of $100,000 per employee, should be included. As such, we’ve included the following company costs in this report:
- Compensation such as salary and wages, paycheck tips, and supplemental payments (e.g. bonuses and commissions payments), up to that $100,000 cap
- Severance payments
- Employer-paid state and local taxes (Federal taxes such as FICA & FUTA are excluded)
- Benefit contributions such as medical/dental/vision insurance premiums, 401(k) match, employer paid life insurance, short-term disability, and long-term disability premiums
Costs that are not considered payroll costs for the purposes of the Paycheck Protection Program include:
- Contractor and vendor Pay
- Expense reimbursements
- Owner’s draws
- Justworks admin fees
- Workers’ Compensation fees
- Fringe benefits and perks
- Imputed Income
The expenditures included in this report are based on currently available guidelines from government regulators. Please note that regulatory guidance regarding the eligibility of particular expenditures as “payroll costs” for the purpose of PPP applications may change. Payroll costs exclude compensation over $100,000 earned by any one employee. Qualifying employee retention tax credit wages will be included in this report if your company is opted into that program. These wages may be included in average monthly payroll calculations for application purposes but are not eligible for PPP loan forgiveness. If you were not a customer of Justworks for the full period selected in this report or you incurred additional “payroll costs” that were processed outside of Justworks, you may need to obtain data from your prior payroll provider or your own records, as applicable.
What if I need a different date range?
You'll have a handful of options of date ranges to pull the report from. According to the application form, most companies can use information from calendar year 2020, so that will be default date range to pull.
However, there are also provisions in the interim final rule and application instructions that allow employers to use other date ranges, depending on if your business is seasonal or a new business.
The alternative date ranges include:
- January 1, 2019 - December 31, 2019, for calendar year 2019
- April 1, 2019 - March 31, 2020, for companies who wish to use the last 12 months
- January 1, 2020 - February 29, 2020, for new businesses
Please note that the ability to pull the report for those seasonal businesses with the above date range is still in development.
What if my company is new to Justworks?
If your business has used another payroll provider during 2019 and/or hasn’t been on Justworks for the entire time period you’re using to calculate your payroll costs, you’ll need to factor that into your calculation separately. We recommend reaching out to your previous payroll provider for any payroll costs your company incurred in 2019 prior to joining Justworks.
What if my company has incurred payroll costs outside of Justworks?
If your business has incurred payroll costs outside of Justworks during the time period you’re using to calculate your AMP costs, you’ll need to factor that into your calculation separately. For example, if your company records paid time off or has employer contributions toward health insurance coverage or a 401(k) plan outside of Justworks, you’ll need to incorporate those costs into your eligible payroll costs and AMP manually, as they won’t be included in the Justworks PPP report.
Why do the salary and wage amounts on the PPP Report not match my Justworks payroll report?
The “Salary and Wages” column in the PPP report is most closely tied to “Gross Earnings” in your Justworks payroll report, Any discrepancies between the figures in the reports is because “Salary and Wages” in the PPP report does not include certain loan ineligible expenses (e.g. fringe benefits) which are included in Gross Earnings.
We have included information in the report based on current regulations and the information that we have in our systems. However, you are ultimately responsible for the content you include in your loan applications, so we recommend that you review this information carefully and discuss your application with your legal, tax, or financial advisor if you have any questions. Additionally, keep in mind that you may have had expenditures that you want to include in your report that are outside of Justworks’ systems, especially if you were not with Justworks for the entire period covered in your report. Finally, if there is other data in Justworks that you would like to pull that is not included in the report, you can contact us at email@example.com or (888) 534-1711.