The Small Business Administration (SBA) has just launched the Paycheck Protection Program (PPP), arranging for forgivable loans to small businesses affected by COVID-19. There are, however, widespread implementation issues, with several banks that will administer the loans not yet being ready to process loan applications, as of April 6, 2020. For general guidance on the program, I can provide you with this fact sheet from the Treasury Department and a website guide from the SBA. Additionally, most large law and accounting firms are constantly issuing client alerts summarizing the latest developments, which are available on those firms’ websites.
I’d like here to focus on a particular issue with PPP loans, for companies that pay independent contractors for services, either exclusively or in addition to traditional employees. Under the provisions of the CARES Act relating to PPP loans, the key number for businesses to identify is “payroll costs,” which is used to calculate both the maximum loan amount (based on payments made in the past) and the amount that can then be forgiven (based on payments made with PPP loan proceeds). The CARES Act is expressly intended to be available to sole proprietorships and independent contractors, but it was ambiguous under the text of the Act itself whether a company’s payments to other independent contractors for services rendered would be included in payroll costs.
However, the SBA ultimately issued new interim rules, which definitively answer that question:
h. Do independent contractors count as employees for purposes of PPP loan calculations?
No, independent contractors have the ability to apply for a PPP loan on their own so they do not count for purposes of a borrower’s PPP loan calculation.
Accordingly, businesses should not include any payments made to independent contractors in the payroll costs calculation, since those independent contractors are able to obtain their own PPP loans through their own banks. That limits payroll costs to amounts paid to true employees and, for sole proprietors, amounts paid to themselves as owners, in each case limited to $100,000 annually per individual paid.
Every deal lawyer has had the experience. The deal negotiations have gone on longer than anyone expected. Frustration is setting in. At that point, one of the individuals involved, more likely to be one of the principals instead of an attorney, demands an all-hands, in-person meeting to get the deal done, and “we’re not leaving until we have a deal.” This impulse, while understandable, is often misguided and can lead to additional frustration.
Writing in Above the Law, Jordan Rothman argues from personal experience that 
In some ways, my law firm, Andrew Abramowitz, PLLC, is at the forefront of recent changes in the delivery of legal services. For example, the firm operates virtually, with the staff attorneys toiling away at home (or wherever – they could be doing it while hang-gliding as long as they do the job well and promptly, as far as I’m concerned). The ability to get the work done without housing everyone in an expensive Manhattan leased space gives the firm flexibility to offer more competitive rates than traditional firms.
When I am estimating costs for a project for prospective clients, particularly those new to the formation of business entities and deal-doing, a common source of confusion is why there needs to be a fee paid to my law firm as well as to a corporate service company like CT Corporation or CSC. So, I thought it would be useful to briefly outline the different roles that each of us plays in the creation and maintenance of entities.