PPP guide for personal trainers, fitness instructors, and health counselors (plus 2021 rules updates!)

In this 8-minute read:

  • Who qualifies for the PPP loan?
  • What can personal trainers, fitness instructors, dietitians, weight loss counselors, and other independent health professionals spend their PPP loans on?
  • How do you know how much of a loan you can get?
  • When and how can personal trainers apply for PPP loan forgiveness?

The Paycheck Protection Program has been a light in a time of financial crisis for businesses across the country. Under the CARES Act, this program allows small business owners to borrow funds to keep their employees paid and the economy moving when it might have been close to impossible otherwise. 

Amid statewide and local shutdowns, we’ve seen many gyms and studios close their doors due to social distancing rules, and this may have impacted your business as a personal trainer, fitness instructor, gym owner, or someone in between. 

We put together this resource to help you know if you are eligible for the PPP loan and how you can spend your funds and receive loan forgiveness when that time comes. 

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Can personal trainers, fitness instructors, and other health professionals qualify for PPP loans?

Many personal trainers, fitness instructors, and other health professionals have the opportunity to apply for the PPP loan to help keep business operations moving, or at least to keep the paycheck coming in while your place of business is closed. 

To meet that first qualification for the PPP loan depends entirely on your employment status. You must be a business owner, sole proprietor, independent contractor, or eligible self-employed individual. 

What does your job look like? Are you contracted by a gym? Do you run your own gym or studio? If you fit the status of self-employed, independent contractor, owner, or sole proprietor, and can verify that with your tax filings (most of these individuals will file taxes using IRS Form 1040 Schedule C), then you can and should apply for the PPP loan. 

The cases where a personal trainer or other health professionals wouldn’t qualify for the PPP loan is if they are employed by a company and receive a W2 as an employee of that business. In this case, you wouldn’t be able to apply for the loan with your W2 job. However, if you had a “1099” side job that meets the right employment status, you can apply for the PPP loan with that, so long as it meets the other eligibility requirements. 

Some additional eligibility requirements for PPP loans:

  • If you wish to apply for a first draw loan (meaning you haven’t received a PPP loan yet), you’ll need to have the right employment status, you must have been in business as of February 15, 2020, and you must have at least an annual income of $4800 with your self-employed job
  • If you wish to apply for a second draw loan (meaning you’ve already received a PPP loan in 2020), then you’ll need to meet these requirements:
    • You have already received a PPP loan and spent the funds on authorized uses before your second draw loan is disbursed
    • You must be able to show that you’ve had a reduction in your revenue by at least 25% when comparing any quarter in 2020 to 2019
    • (You must have fewer than 300 employees)

This is not an exhaustive list of requirements but are the basics that most business owners, contractors, and self-employed individuals need to meet. For additional information and special circumstances, visit our PPP Eligibility FAQ

What can personal trainers, fitness instructors, and other independent health professionals spend their PPP loans on?

Before you apply for the PPP loan, it’s helpful to know what you can spend these funds on to determine if it’s worth it for your business. We can tell you right now, it probably is. It’s also important to know what to spend these funds on because if you use them all on authorized expenses, your loan can be fully forgiven. This program was designed to keep businesses open and people employed, and the intent from the beginning was for the vast majority of PPP loans to be fully forgiven (which means, in essence that it becomes free money for you).

The two categories that approved PPP loan expenses fall into are payroll and business expenses. 

The first big rule of how to spend your PPP loan and get full loan forgiveness is that at least 60% of it needs to go towards “payroll expenses.” The idea is to help keep America’s workers employed. So, if you have any employees, you need to keep them on payroll and maintain their compensation levels with this loan. If you don’t have any employees, then you certainly count as one of America’s workers, and can legally use this portion of the loan (up to 100% of it) to pay your own income. 

The other (up to) 40% of your PPP funds can be spent on any or all of the following approved business expenses:

  • Mortgage, rent, and utilities: this must apply to business-related expenses. If you have a studio, gym, or even part of your home that is used for your business, you can spend your PPP loans on that cost. Basically, any part of this cost that you could deduct from your business taxes is an eligible expense
  • Debt interest payments: any interest payments you have on debts that are related to your business (credit cards, business loans, etc.)
  • Operational expenses: business software and clouding computing services that help facilitate essential business functions like scheduling, invoicing, payment processing, product or service delivery, expense tracking, inventory management, and other sales and billing functions
  • Costs for suppliers: regular suppliers for inventory and other materials that you need for your operations can be covered by your PPP funds. Any purchase orders or contracts related to these costs must have been in place before the first day of your covered loan period
  • COVID-19 expenses: this could be PPE, sneeze guards, cleaning supplies, or any major costs that you incurred to make sure your business adheres to public health guidelines for COVID-19
  • Damages to property: businesses that faced property damages from the public disturbances and riots in 2020 can use their PPP loan to help pay for any damages that weren’t covered by insurance

Check out this article to help track your expenses: Tracking PPP expenses to maintain forgiveness (tools and tips!) 

How do you know how much of a loan you can get? (Max PPP loan calculations for independent fitness specialists or personal trainers)

The loans for the PPP are limited and you can’t just apply for any amount that you feel would help. But, there have been recent updates that allow Schedule C (form 1040) applicants to apply for a potentially larger loan than before. 

On February 22, 2021, the Biden-Harris administration announced some rule changes to the Paycheck Protection Program. One major change is that Schedule C applicants can choose to use their gross profits (instead of their net profits) to calculate their maximum loan amount, allowing even more people to qualify for PPP relief. If your personal trainer job is more of a side job to bring in a little extra cash, this new rule change could make the difference if you were just on that border of being eligible. 

That being said, there is a specific calculation in place to help you determine your maximum loan amount. For self-employed individuals without employees, follow these steps:

  1. You’ll need to get your 2019 or 2020 IRS Form Schedule C (you get to choose). To use your gross profits to calculate your max loan amount, get the number from line 7. If that number exceeds $100,000, reduce it to $100,000. 
  2. Take the number you got in Step 1 and divide it by 12 to get your average monthly profits. 
  3. Take your monthly average and multiply that by 2.5 to get your maximum loan amount. 
  4. Bonus: If you received the Economic Injury Disaster Loan in 2020, you may be able to apply for a little more. Add any outstanding amount of your EIDL made between January 31, 2020 and April 3, 2020 to your max loan amount from Step 3. Just make sure not to add any advance that you receive because that doesn’t need to be paid back. 

When and how can personal trainers and fitness/health/diet specialists apply for PPP loan forgiveness?

The fact that the PPP loan can be fully forgiven might be the most important and appealing part of this entire program. You can begin the process to apply for loan forgiveness when you’ve spent your PPP funds. You just need to apply within 10 months of the last day of your covered loan period. 

To apply for loan forgiveness, you should first check if your lender has opted-in to the new SBA PPP Direct Forgiveness Portal. If your PPP loan was for $150,000 or less, AND if your lender has opted-in to the use of the platform, you will be able to submit your PPP loan forgiveness application online directly to the SBA, using the electronic equivalent of SBA Form 3508S. For full details, read our post about the new SBA PPP Direct Forgiveness Portal and other recent rule changes.

If the above doesn’t apply to you, contact your PPP lender and complete the correct application form:

  • Ask your lender to help you complete the appropriate forgiveness application (See the new PPP forms here; there are multiple applications depending on your loan and business, so your lender will make sure you get the right one)
  • Gather together any documentation that you’ll need to verify how your PPP funds were spent: bank statements, cancelled checks, receipts, invoices, etc.
  • Take your documentation to your lender and they will help you complete the PPP forgiveness application and submit it to the SBA
  • Wait to hear back from your lender on a decision, and don’t be afraid to reach out to them if it’s been a little while

Here are some additional resources for PPP loan forgiveness that you may find helpful:

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