How Do I Qualify For The PPP Loan For My Online eCom Business/Agency/Consulting Brand, And How Do I Apply For It?

Hey Guys, this is Alan Chen with the Free Cash Flow Agency, and I’m a Certified Public Accountant; first of all, thank you for watching this video. In this video, I want to explain this hot topic on everyone’s mind: how do I qualify for the PPP loan for my online business, and how do I apply for it?

This is Part 1 of a 3-part series, and I hope it will help many struggling business owners out there looking for this type of advice, as I know it can be unclear. So, first of all, what is the PPP or Paycheck Protection Program? 

What is the PPP?

The PPP loan was started as a response to the devastating effect that COVID-19 had on small businesses across the nation and the intent to help small companies to maintain their current workforce by providing a loan to small businesses. The PPP loan can help fund payroll costs, including benefits. It may also be used to pay for mortgage interest, rent, utilities, worker protection costs related to COVID-19, uninsured property damage costs caused by looting or vandalism during 2020, and certain supplier costs and expenses for operations.

So here are the specific qualifications: 

1. you must be a business that was started before February 15, 2020 

2. Your business is still operational and functioning as of today 

3. You have no more than 500 employees, as this program was intended to help small businesses. There are also specific requirements to make this into a forgivable loan that we will go through in part 3 of this series. 

So one of the questions is how much my business can get from this program. 

And the answer is you can get 2.5 times your average monthly payroll cost, up to a maximum of $10 million. So, for example, if your average monthly payroll cost is $100,000, you can borrow up to $250,000 through the loan program. So what you can include in the payroll cost calculation is the following: Salary, wages, commissions, and tips, up to $100,00 per employee per year; independent contractors do not count toward this- Also, you can include employee benefits such as vacation, medical insurance premium cost, and sick leave cost. And lastly, you can consist of state and local taxes you paid on that compensation.

So this loan is fantastic; the interest rate is only 1%! And you have 5 years to pay it back. It will cover a period of 8 or 24 weeks that you can elect to help pay for payroll and payroll-related costs. And after the 8 or 24 weeks is up, you will even have a grace period of 10 months before you have to start the loan payments. 

How do I apply? 

There are different ways to do this, and, from my research and interview with business owners, the fastest way is through who you bank with. So if you bank with Chase, for example, the first contact you should make is with your relationship officer at Chase, and make sure you let them know that you qualified for the PPP loan and would like to apply through them. If you happen to bank with someone that doesn’t provide PPP assistance or if your bank is too backed up with PPP loan requests. 

Then I suggest you go through the SBA’s Lender Match program, which helps pair small business owners with qualified PPP loan lenders. I will make sure to include all the helpful links below. If you have any questions about the PPP loan, please comment below, and I will answer them. 

For Self Employed Business Owners

I want also to add a section for self-employed business owners meaning you do not have a workforce. You are also qualified to apply for the PPP loan and can claim 2.5 months’ net profit from 2020 as owner compensation replacement. So, for example, if you had 120,000 in net profit in 2020, you are eligible to receive up to 25,000 of that as a loan and get it all forgiven.

Additionally, if your business is looking for an all-in-one solution to save on taxes and have excellent bookkeeping done on your behalf, or if you need more guidance on the PPP loan, you can click the link in the description and book a free consultation call with FCF Agency. We will see if we can be a great fit together. 

Look out for Part 2 of the PPP loan series, where we deep dive into how to use the PPP loan best after you receive it! Thank you so much, and have a great day ahead!

See more info on SBA funding programs here:


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