May 5, 2020 CFO Agency

What Do I Do With my PPP Money?

First of all, congratulations! Receiving Paycheck Protection Program (PPP) and/or Economic Injury Disaster Loan (EIDL) funding is truly historic.

This is the first time in history “bail-out” money has been made available to small businesses, not just big businesses. So let’s take a moment and celebrate that!

The PPP funds were administered through the banking system and each bank had a little different understanding of how to calculate the payroll number you could use for the loan amount.  So as you read through these steps, understand you will need to overlay your bank’s method of calculation.

NOTE: If you choose to pay employees with the FMLA program, that payroll is not part of these calculations.  Those funds will be returned to you with tax credits when you file your quarterly payroll reports.

In order for your loan to become forgivable, the funds must be used for at least 75% Payroll (your bank’s calculation of what this includes), rent or mortgage interest, utilities including telephone, and loan interest for loans that were in place prior to February 15, 2020.  The catch is they must be used in this way within 8 weeks of the loan date on your loan documentation.

Once the 8 weeks has passed, you can apply to have your loan forgiven through your bank.

So what is the best way to track these funds and prove proper use?

In your accounting reports, of course! ☺

We recommend you create a sub-account of your bank account where the funds were deposited.

Then process only appropriate expenses through that sub-account.  This way you don’t need to open a separate bank account for 8 weeks. When it comes time to prove appropriate use of funds, you can simply print a register from this sub-account, and include it with the appropriate payroll reports and vendor invoices.

We are here to help!  Email and Grace will be happy to get you scheduled.

In Abundance,



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