Apply Now for Paycheck Protection Loans for Farmers, Regardless of Income

According to a study issued Wednesday, the SBA’s industry-level income requirements may disqualify thousands of agricultural farmers from Paycheck Protection Program loans. The SBA announced it Friday night. The IFR eliminates industry-specific revenue limitations. Businesses with 500 or less employees in the US are eligible.

Loans under the Paycheck Protection Program (PPPL)

In a word, the PPPL is intended to assist small companies in keeping their workers paid during this trying time. The PPPL offers small firms $349 billion in forgiven loans to pay workers and keep them on the payroll. Most enterprises with less than 500 workers, including non-profits, the self-employed, cooperatives, and, startups are eligible for these loans.

The PPPL will provide qualifying firms loans of up to $10 million to cover 2.5 times their average monthly payroll expenditures, as assessed over the previous 12 months, plus an extra 25% for non-payroll costs. Salaries, commissions, and gratuities, as well as employee benefits (such as health insurance premiums and retirement benefits), state and local taxes, and remuneration to sole proprietors or independent contractors, are all included in payroll expenses. Interest on mortgage commitments incurred before February 15, 2020, rent under lease agreements in existence before February 15, 2020, and utilities for whose service started before February 15, 2020 are examples of non-payroll charges.

Main selling feature of PPPL is that eligible expenses paid over an eight-week period from June 30, 2020 to October 15, 2020 are forgiven if the business retains personnel and payroll. Any revenues in excess of this amount will be reimbursed at 1%. The PPPL loans have a two-year period.

Aside from the issue of industry-specific income requirements, the IFR seems to corroborate that salaries given to H-2A employees are not included in a farm’s payroll costs. Independent contractors do not count against payroll expenditures or the number of workers at a company, according to the IFR. Independent contractors are able to qualify for their own PPP loan, according to the argument.

How to Make an Application

The funds from this program will be distributed on a first-come, first-served basis to small firms. We suggest contacting a pre-approved lender as soon as possible. Potential borrowers may use the example application listed here to help them prepare for the lender meeting.

Farmers may apply for the PPP via any participating FDIC, FCU, or Farm Credit System institution, as well as any existing SBA 7(a) lender. On the SBA website, you may identify current eligible lenders.

Applications may be submitted starting on:

* On April 3rd, small businesses and sole proprietorships will be able to submit applications via existing SBA 7(a) lenders.

*Currently active SBA 7(a) lenders for independent contractors and self-employed individuals have a deadline of April 10.

Once eligible and registered in the SBA program, any federally insured depository institutions, credit unions, and Farm Credit System institutions may make loans. New lenders must submit an application to the Small Business Administration (SBA) at [email protected].

Outstanding Issues

Although the IFR clarified the income criteria, this is a new scheme, so issues are certain to occur. The following are some of the questions we’ve previously received:

Is it possible to utilize PPP funds to pay rent? Is rent for all types of rentals (equipment, property, etc.) or only for building rentals? In the IFR, “rent” does not what is defined by SBA. A definition has been sought from the SBA.

Will affiliations have an influence on the number of workers at the company? Yes, it is possible. When a farmer requests for a PPP loan, this will be assessed on a case-by-case basis.

Do H-2A workers count toward the overall number of employees on a farm? The IFR didn’t say anything about this. We’re working on a solution to this problem.


The PPPL, which was created to keep small company workers on the payroll, will likely be a lifeline for many people, including independent contractors and self-employed people who will benefit from the program’s extended eligibility. A reminder that monies from this program are limited and will be distributed on a first-come, first-served basis.

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