Time Period Payroll Calculations

What time period should borrowers use to determine their number of employees and payroll costs to calculate their maximum loan amounts?

Most borrowers will use the Calendar year 2019 aggregate payroll data. Seasonal businesses may use an average monthly payroll for the period between Feb 15 2019, March 1, 2019, and June 30 2019.

Applicants that were not in business from February 15 2019 to June 30 2919 may use the average monthly payroll for the period between Jan 1 2020 and Feb 29 2020.

Applicants may use the average employment over the same time periods to determine the number of employees.

Linked here and pasted below is the text from the official question and answer document published by the Department of the Treasury on April 10, 2020, which you should reference:

https://home.treasury.gov/system/files/136/Paycheck-Protection-Program-Frequently-Asked-Questions.pdf

Below is the official question from Q14 as of April 10, 2020

14. Question: What time period should borrowers use to determine their number of employees and payroll costs to calculate their maximum loan amounts?

Below is the official answer from Q14 as of April 10, 2020

Answer: In general, borrowers can calculate their aggregate payroll costs using data either from the previous 12 months or from calendar year 2019. For seasonal businesses, the applicant may use average monthly payroll for the period between February 15, 2019, or March 1, 2019, and June 30, 2019. An applicant that was not in business from February 15, 2019 to June 30, 2019 may use the average monthly payroll costs for the period January 1, 2020 through February 29, 2020. Borrowers may use their average employment over the same time periods to determine their number of employees, for the purposes of applying an employee-based size standard. Alternatively, borrowers may elect to use SBA’s usual calculation: the average number of employees per pay period in the 12 completed calendar months prior to the date of the loan application (or the average number of employees for each of the pay periods that the business has been operational, if it has not been operational for 12 months).

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