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regarding PPP loan forgiveness

A big question many of us have relates to insurance premium expenses (not employee health care plans). First, can workers compensation insurance premiums be added to either the 75% payroll side or the 25% expense side of the loan forgiveness equation? Since it is an integral part of the employee compensation expense (for the employer) and is a direct function of their payroll cost, we would like to think it is forgivable. And second, can any other insurance expense (commercial vehicle, general liability, or umbrella policy) be added to the 25% expense category for loan forgiveness? Since we were told company vehicle gas is an allowable expense in the utilities category, we would hope that the vehicle insurance for essential service technicians is also a forgivable expense. What do you think? Thank you so much for your guidance!

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Answers

  • Brian_SBMBrian_SBM Vice President, Entrepreneurship Administrator admin

    @hillsbros
    Without clear guidance it's hard to say, but workers comp and other insurance premiums are not noted anywhere in the PPP loan forgiveness form or in the interim rules.
    For non-cash eligible payroll costs, the only allowable expenses are healthcare premiums, retirement benefits, and state/local taxes.
    Nonpayroll costs are mortgage interest, rent and utilities. As you note, the definition of transportation utilities is quite vague. The vehicle insurance issue is a good question, but to be on the safe side, I would encourage you to not claim any of those expenses.

  • Quantum610Quantum610 Owner Member

    What if your FTE count is reduced because an employee contracted Covid after funding was received and is not able to return to work before June 30th? How does this effect the 75% ratio for forgiveness?

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