# Paycheck Protection Program (PPP) – How much can I borrow?

I have determined that I am eligible for the Paycheck Protection Program (PPP). How much can I borrow?

Under the Paycheck Protection Program (PPP), the maximum loan amount is the lesser of \$10 million or an amount that you will calculate using a payroll-based formula specified in the CARES Act, as explained below.

How do I calculate the maximum amount I can borrow under the Paycheck Protection Program (PPP)?

The following methodology, which is one of the methodologies contained in the Act, will be most useful for many applicants.

• Step 1: Aggregate payroll costs (defined in detail below in f.) from the last twelve months for employees whose principal place of residence is the United States.
• Step 2: Subtract any compensation paid to an employee in excess of an annual salary of \$100,000 and/or any amounts paid to an independent contractor or sole proprietor in excess of \$100,000 per year.
• Step 3: Calculate average monthly payroll costs (divide the amount from Step 2 by 12).
• Step 4: Multiply the average monthly payroll costs from Step 3 by 2.5.
• Step 5: Add the outstanding amount of an Economic Injury Disaster Loan (EIDL) made between January 31, 2020 and April 3, 2020, less the amount of any “advance” under an EIDL COVID-19 loan (because it does not have to be repaid).

The examples below illustrate this methodology.

Example 1 – No employees make more than \$100,000

• Annual payroll: \$120,000
• Average monthly payroll: \$10,000
• Multiply by 2.5 = \$25,000
• Maximum loan amount is \$25,000

Example 2 – Some employees make more than \$100,000

• Annual payroll: \$1,500,000
• Subtract compensation amounts in excess of an annual salary of \$100,000: \$1,200,000
• Average monthly qualifying payroll: \$100,000
• Multiply by 2.5 = \$250,000
• Maximum loan amount is \$250,000

Example 3 – No employees make more than \$100,000, outstanding EIDL loan of \$10,000

• Annual payroll: \$120,000
• Average monthly payroll: \$10,000
• Multiply by 2.5 = \$25,000
• Add EIDL loan of \$10,000 = \$35,000
• Maximum loan amount is \$35,000

Example 4 – Some employees make more than \$100,000, outstanding

• EIDL loan of \$10,000
• Annual payroll: \$1,500,000
• Subtract compensation amounts in excess of an annual salary of \$100,000: \$1,200,000
• Average monthly qualifying payroll: \$100,000
• Multiply by 2.5 = \$250,000
• Add EIDL loan of \$10,000 = \$260,000
• Maximum loan amount is \$260,000

Other Paycheck Protection Program (PPP) Resources:

For a top line overview of the program, click here.

If you’re a borrower, more information can be found here.

The application for borrowers can be found here.