One of the key challenges small businesses have faced in this process is not having all the documentation needed to process the PPP application. In fact, CovidLoanTracker.com sees it here through their PPP application: so far only about 50% of businesses who begin the application process actually complete it.

The number one reason for this? They don’t have everything they need.

CNBC has reported the same issue:

“A lack of preparation is one of the most common mistakes that owners made when applying for PPP loans during the first round, says Rob Scott, Great Lakes regional administrator for the SBA.”

So, what exactly do you need to have ready? Here’s a helpful checklist, but let’s break-it-down and try to keep it simple:

• Driver’s license: front & back photos/scans for every person who owns 20% of more of the company

• All the company formation documents you can get hold of: certificate of registration, any operating agreements, anything that gets to how the company was formed and is structured legally

• Tax returns: at least two if not three years of tax returns beginning most importantly with the 2019 return

• Payroll is the and most important trickiest part. So here’s what you should try to get from your payroll service provider:

The last twelve full months of payroll, and then calculate the “average monthly” payroll from that. BUT - some banks are actually asking for that monthly average to be calculated from the calendar year 2019. Our advice? Do both! Have as much ready as possible.

IMPORTANT: what are payroll costs? some small business owners are confused. It’s everything, INCLUDING 401(k) and health insurance contributions (including employer contributions). Quite simply: salary, wage, commission and tips, vacation, medical, parental and sick pay. It ALSO includes payment for group healthcare benefits, including insurance premiums paid. All costs in there. Even payroll taxes!

Mortgage, rent, utility documents, etc: your big ongoing expenses

Proof your business is in good standing

Proof the COVID-19 pandemic has negatively impacted your business

Finally, and often overlooked, check your business credit file and make sure it’s up to date and correct. About 25% of companies have found their business credit files are inaccurate, A good place to check is through Nav.

Preparation is most of the battle - and having all your documents in order and ready-to-go will help you nail the PPP application process.

Let us know how your process goes or if we missed important items that you discover you needed.