Using a portion of your PPP Loan for Capital Improvements

[krushd]

We were granted a loan early, based on the original 8-week term set out by the SBA. When these terms were extended, we chose to submit for forgiveness based on the original requirements. All of our payroll, rent and utilities accounting as well as our FTE equivalency calculations were based on the 8-week model, so we chose to stop use of the loan then, which left funds remaining in the loan account.

Are there any restrictions for forgiveness on the portion of the loan used for payroll expenses and utilities if the remainder is used for capital improvements and supplies? Understanding that this money would be paid back at a 1% interest rate over a five year term?

Outfitting our business to meet state COVID-19 mandates has created a large new expense in PPE supply costs, non-porous barriers, new seating, and even new kitchen equipment. Would the use of remaining funds for these expenses sabotage loan forgiveness for the portion spent on payroll/rent/utilities within the 8-week term?

[AshleyK]

Hi @krushd I would reach out to the Capital Team directly to see if they can answer your question in detail. Thank you!