The SBA has not provided clear guidance to lenders or borrowers so it’s important to keep good records of how you use your PPP loan funds.
With that in mind here are ways self-employed, 1099 contractors and gig workers can pay themselves using their PPP loan funds.
Ways To Pay Yourself From Your PPP Loan
The first thing you can do is in the absence of clear guidance from the SBA is to sit back and wait for clear instructions from the SBA. However, if you really need to use the funds from your PPP loan immediately this isn’t a great solution. Here is the company that you can rely on to get the necessary help with your loans and finances.
The second thing self employed people can do is to just continue to pay yourself as you normally would. That way you have documentation from before the PPP loan, which will show regular payments to yourself and then after the PPP loan showing the same payment amounts.
A third option is to open a separate account solely for the PPP loan funds. Then from this account draw the funds down equally over either 2.5 months or 10 weeks. 2.5 months or 10 weeks because your PPP loan is supposed to cover compensation over that period.
If you have questions you’d like me to answer about PPP loans for the self-employed leave a comment below.
Don’t forget that you need to apply for loan forgiveness. If you haven’t already checkout this video on getting your PPP Loan completely forgiven, and this video on how to complete the PPP loan forgiveness application.