Eligible Business Types

• Sole proprietors, independent contractors, and eligible self-employed individuals, S-Corporations, 1065 Partnerships, C-Corporations, LLC’s
• Not-for-profits, including churches and 501(c)(6) membership organizations
• Lodging and food service operations with North American Industry Classification System (NAICS) codes starting with 72 and fewer than 300 employees per physical location

First Draw

Eligibility Requirements

• Did not receive a PPP loan in 2020.
• Have no more than 500 employees per location, unless the SBA size standard for industry is met.
• Business was in operation on February 15, 2020.
• Loan request of $10 million or less ($20 million or less for a corporate group).
• PPP Funds need to be used for specific purposes and within a specific time frame for your loan to stay eligible for forgiveness.  For guidance visit https://www.sba.gov/funding-programs/loans/coronavirus-relief-options/paycheck-protection-program/ppp-loan-forgiveness.
• Have a Sound business checking account or personal checking account (if a Sole Proprietor). This is where we’ll deposit your PPP funds.

Documentation Requirements – not required to get prequalified

• Detailed Payroll Report for 2019 or 2020 – needed to calculate the loan amount and verify if any employees were compensated over $100,000.
  • When providing internally prepared or 3^rd party payroll report such as Gusto, Paychex or ADP, please provide the detailed report listing all employees, their compensation for the year, and company payroll totals.
  • For seasonal employers, payroll may be determined by any consecutive 12-week period between February 15, 2019 and February 15, 2020.
  • Self-employed individuals and independent contractors must also provide their 2019 (filed) and 2020 Schedule C (if choosing to use to show income). Line 31 (net profit) on the Schedule C will be the annual payroll cost used in the loan calculation.
  • Partnerships must provide a copy of the 2019 or 2020 business tax return.  Partners may claim self-employment income (Schedule K-1, line 14a, then multiplied by 0.9235) as part of the annual payroll cost.
• Tax form for 2019 or 2020 supporting the payroll report provided.  Acceptable documents is Form 940 (annual employee cost), Form 941 (quarterly employee cost, but need all quarters) or W-3.  For self-employed individuals and independent contractors, this document is not needed as the Schedule C will suffice.
• If claiming medical benefits, retirement benefits and/or state and local taxes paid by the company, a copy of the company’s 2019 or 2020 P&L statement will be needed with the expenses highlighted.
• Copy of your Driver License.
• Detailed Payroll Report for February 2020 – needed to verify the number of full-time equivalent (FTE) employees on the applicant’s payroll at this time. This is part of the loan forgiveness calculation and it verifies the company was in operations as of 2/15/2020. For self-employed individuals and independent contractors, this document is not needed (see next bullet point).
• Bank statement for February 2020 – needed to verify the company was in operations as of 2/15/2020 if a Detailed Payroll Report for February 2020 is not provided.

Second Draw

Eligibility Requirements

• Have received a first draw PPP loan.
• Have at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020.
• Have no more than 300 employees per location, unless the SBA size standard for industry is met.
• Business was in operation on February 15, 2020.
• Loan request of $10 million or less ($20 million or less for a corporate group).
• PPP Funds need to be used for specific purposes and within a specific time frame for your loan to stay eligible for forgiveness.  For guidance visit https://www.sba.gov/funding-programs/loans/coronavirus-relief-options/paycheck-protection-program/ppp-loan-forgiveness.
• Have a Sound business checking account or personal checking account (if a Sole Proprietor). This is where we’ll deposit your PPP funds.

Documentation Requirements – not required to get prequalified

• Documentation to substantiate a 25% reduction of gross receipts.  Here are the documents that are acceptable:
  • Quarterly financial statements for the entity. If the financial statements are not audited, the Applicant must sign and date the first page of the financial statement and initial all other pages, attesting to their accuracy. If the financial statements do not specifically identify the line item(s) that constitute gross receipts, the Applicant must annotate which line item(s) constitute gross receipts.
  • Annual IRS income tax filings of the entity (required if using an annual reference period).  If the entity has not yet filed a tax return for 2020, the Applicant must fill out the return forms, compute the relevant gross receipts value (see Question 5), (- I don’t see a question 5) and sign and date the return, attesting that the values that enter into the gross receipts computation are the same values that will be filed on the entity’s tax return.
• If Sound did not process your First Draw PPP loan, the documentation noted for First Draw Requirements will be needed as well.

Payroll Requirements – not required to get prequalified

• Detailed Payroll Report for 2019 or 2020.
  • This is needed to calculate the loan amount and verify if any employees were compensated over $100,000.
  • When providing internally prepared or 3^rd party payroll report such as Gusto, Paychex or ADP, please provide the detailed report listing all employees, their compensation for the year, and company payroll totals.
  • For seasonal employers, payroll may be determined by any consecutive 12-week period between February 15, 2019 and February 15, 2020.
  • Self-employed individuals and independent contractors must also provide their 2019 (filed) or 2020 Schedule C (if choosing 2020 Schedule C, we will still need the filed 2019 Schedule C).  Line 31 (net profit) on the Schedule C will be the annual payroll cost used in the loan calculation.
  • For Partnerships, please provide a copy of the 2019 or 2020 business tax return.  Partners may claim self-employment income (Schedule K-1, line 14a, then multiplied by 0.9235) as part of the annual payroll cost.
• Tax form for 2019 or 2020 supporting the payroll report provided.  Acceptable documents is Form 940 (annual employee cost), Form 941 (quarterly employee cost, but need all quarters) or W-3.  For self-employed individuals and independent contractors, this document is not needed as the Schedule C will suffice.
• If claiming medical benefits, retirement benefits and/or state & local taxes paid by the company, a copy of the company’s 2019 or 2020 P&L statement will be needed with the expenses highlighted.
• Detailed Payroll Report for February 2020.  This is needed to verifying the number of full-time equivalent (FTE) employees on the applicant’s payroll at this time.  This is part of the loan forgiveness calculation and it verifies the company was in operations as of 2/15/2020.  For self-employed individuals and independent contractors, this document is not needed (see next bullet point).
• Bank statement for February 2020 to verify the company was in operations as of 2/15/2020 if a February 2020 payroll report is not provided.