How to calculate max PPP loan amount: non-profits, religious institutions, veterans orgs

Important PPP update for 2021

On December 22, 2020, Congress passed a bill renewing funding under the CARES Act, including an additional $284 billion earmarked for America’s struggling small businesses. The rules and application process for PPP loans and forgiveness have been modified, with more businesses eligible for PPP loans (INCLUDING 501(C)(6) NON-PROFITS), more expenses forgivable, and a simplified application process. Also there is provision for “second draw” PPP loans for businesses that received PPP funding in 2020. Start your PPP loan application now!

 

In this 2-minute read:

  • How to calculate PPP loan amounts for non-profits, religious institutions, veterans organizations, and tribal businesses

Just as many businesses across the United States are being impacted by COVID-19, your non-profit or religious organization might have taken a huge financial toll during this economic downturn. 

In this article, we’ll help you determine the maximum PPP loan amount you can request as a non-profit, religious institution, veterans organization, or tribal business. 

Get your PPP loan or second draw PPP loan through Womply! Womply has helped over 200,000 businesses get their PPP funding. It’s free to apply for a PPP loan, and Womply can help connect you with an SBA lender that’s right for you! Start your PPP application.

How to calculate the maximum PPP loan amount allowed for non-profits, tribal businesses, veterans organizations, and religious institutions

Millions of businesses have already put in their requests for the PPP loan, but it’s not too late if you haven’t done this already. Congress has approved a new round of funding, and we expect there will likely be more before the COVID-19 crisis is over, due to the overwhelming demand. But don’t wait to apply. The current deadline is March 31, 2021.

Follow the steps outlined here to determine how much you can request for your non-profit organization, veterans organization, tribal business, or religious institution, up to the max of $10 million.

Step 1: Total your 2019 or 2020 payroll expenses

Gather the documentation outlined below and total up your 2019 or 2020 payroll expenses.

Compute 2019 or 2020 payroll costs by adding the following:

    • 2019 or 2020 gross wages and tips paid to your employees whose principal place of residence is in the United States, which can be computed using 2019 IRS Form 941 Taxable Medicare wages & tips (line 5c-column 1) from each quarter plus any pre-tax employee contributions for health insurance or other fringe benefits excluded from Taxable Medicare wages & tips, subtracting any amounts paid to any individual employee in excess of $100,000 and any amounts paid to any employee whose principal place of residence is outside the U.S;
    • 2019 or 2020 employer health insurance contributions;
    • 2019 or 2020 employer retirement contributions and
    • 2019 or 2020 employer state and local taxes assessed on employee compensation, primarily state unemployment insurance tax (from state quarterly wage reporting forms).

Please note: The entity’s 2019 or 2020 IRS Form 941 and state quarterly wage unemployment insurance tax reporting form from each quarter (or equivalent payroll processor records or IRS Wage and Tax Statements), along with documentation of any retirement and health insurance contributions, must be provided to substantiate the applied-for PPP loan amount. A payroll statement or similar documentation from the pay period that covered February 15, 2020 must be provided to establish you were in operation and had employees on that date.

Step 2: Calculate your average monthly payroll costs

Total the amount from Step 1 and divide it by 12 to get your average monthly payroll costs for 2019 or 2020. 

Step 3: Multiply the average by 2.5

Take your monthly average payroll costs and multiply that number by 2.5.

Step 5: Add any outstanding EIDL loans

If you applied for an Economic Injury Disaster Loan (EIDL) from January 1, 2020 to April 3, 2020, you can include any outstanding loan amount in your PPP loan request. 

Do not include any portion of an EIDL COVID-19 loan that you have received as an “advance,” as those funds do not need to be repaid. 

Here’s an example of what that calculation might look like for a non-profit, religious organization, tribal business, or veterans organization that took out an EIDL loan:

Annual payroll expenses: $600,000
Average monthly payroll expenses: $50,000
Multiply by 2.5: $125,000
Add outstanding EIDL loan amount of $10,000
Total PPP amount to request: $135,000

Let Womply help you apply for your PPP loans!

As you know, it’s free to apply for a PPP loan, and we know you have lots of choices. So why should you let Womply connect you with an approved SBA lender? Because we know what we’re doing and people love the help we provide. We’ve helped over 200,000 businesses, contractors, sole proprietors, and self-employed individuals get approved. Don’t wait! The deadline is March 31, 2021.

Start your PPP application now!

Learn more, plus get free reputation monitoring and customer insights when you sign up for Womply Free!

Blog

COVID-19 stimulus for consultants, contractors, agents (BIG PPP RULE CHANGE)

In this 5-minute read: Paycheck Protection Program (NEW RULES/BENEFIT FOR SCHEDULE C FILERS!) Pandemic Unemployment Assistance (PUA) benefits SBA Economic […]

Read More

Does California Prop 22 impact PPP loans? (plus NEW RULE CHANGES)

In this 3-minute read: What is California Prop 22? How does it affect app-based drivers who want to apply for […]

Read More

Can consultants apply for PPP loans? (important updates!)

In this 4-minute read: Do consultants qualify for PPP loans? What other eligibility requirements should you be aware of? Recent […]

Read More

Can real estate agents get PPP loans? (important changes for 2021!)

In this 4-minute read: Can real estate agents apply for PPP loans? Are there any other PPP loan eligibility requirements? […]

Read More

PPP UPDATE: New max loan amount calculation for Schedule C borrowers

In this 3-minute read: What changes to the PPP process will impact “Schedule C filers”? New rules will allow certain […]

Read More

14-day PPP exclusivity period starts today: what you need to know

In this 3-minute read: PPP “Exclusive Application Period” opens 2/24/21 and continues through 3/9/21 Businesses with 20 or more employees […]

Read More

Start Your PPP Application.

What describes you or your business best?

My business has multiple employees.

My business does not have multiple employees and/or I work for myself (e.g., Uber drivers, DoorDash couriers, independent contractors).