What happens if I get a PPP Loan and unemployment?

In the event of hardship, like a layoff or illness, it can be very tempting to use your unemployment benefits to supplement your income. It’s also possible that you could have received Unemployment Insurance (UI) while also taking out a PPP loan. While there are exceptions, this is not advisable in most cases. This article will explain what happens when you get both unemployment and PP loans at the same time.

You can’t get both unemployment and a PPP loan.

You can’t get PPP loans and unemployment benefits at the same time.

If you are receiving any kind of unemployment benefits, including a PPP loan, you will not be able to continue to receive those benefits. This is because the government does not consider a PPP loan as employment income. If they find out that you have been working while receiving their payments, they will stop paying them altogether.

Another thing that may happen if you are self-employed or employed and taking on an additional job during this period is that your existing employers might decide not to continue offering you work or hire more employees instead of expanding their business operations (for example).

There are exceptions.

There are exceptions to the rule, however. For example:

• If you have a disability that prevents you from working and it’s been approved by Social Security or another agency, you may be eligible for unemployment benefits.
• If your state has a specific law on unemployment eligibility for PPP borrowers, it will supersede federal rules. In this case, if there is an exception for PPP borrowers in your state’s law (and there often is), then those exceptions will apply to you regardless of what happens with federal guidelines.

There may be consequences if you got both by mistake.

If you got PPP benefits and unemployment benefits at the same time by mistake, there may be consequences.

• You may have to pay back the PPP loan. The Department of Education will send you a notice if they think this is happening, but it’s important to keep an eye out yourself as well. If your income was too high when you applied for the loan, or if it wasn’t high enough after you got the benefits, then there’s a chance that your loan could be considered ineligible for repayment in full (or partially). In this case, it might be possible for them to recoup some or all payments from your paycheck and put them towards paying back that debt—making both of these programs more expensive than they needed to be!
• You’ll likely owe unemployment compensation fees on top of everything else: In addition to possibly owing money from an invalidated student loan obligation, anyone who knowingly received unemployment benefits while also receiving Pell Grant-based aid through another source may face fines ranging anywhere between $100-$1000 per month until paid off (which would amount up quickly!).

If you got a PPP loan but used it all to bring back employees, you may be able to get unemployment.

You may be eligible for unemployment if your company received a PPP loan and you used it to bring back employees. However, your state’s unemployment office will determine whether or not the loan is counted as wages that would disqualify you from receiving benefits.

In order for this to happen, the following conditions must be met:

• You have been out of work through no fault of your own.
• The company used the money from its PPP loan in order to rehire some workers who had left because they could not find jobs elsewhere.

If these conditions apply, there is a chance that you can get approved for unemployment benefits by filing an appeal with your local government agency.

You’ll have to pay back your PPP loan.

If you’re receiving unemployment, your PPP loan will be considered a priority debt. That means that the government is going to take money from whatever sources they can get it from in order to pay off your PPP loan first. If they don’t have enough money to cover all of the debts, then they’ll pay off what they can and use whatever is left over as an incentive for people to repay their loans. If there’s still not enough money after paying back all the debts, then you’ll be required to return any additional funds that were received during this period of time.

In order to qualify for unemployment benefits while also having a private party payment (PPP) loan balance outstanding with the United States Department of Labor Employment Training Administration (ETA), you must ensure that no more than 50% of your gross wages are used towards repaying this debt before applying for UI benefit payments from ETA.

Decide which way you want to go before applying for either.

Before you apply for either, it is important to decide which way you want to go. If you are approved for a PPP loan and receive benefits, the state will begin paying back your loan debt through withholding from those benefits. If you qualify for unemployment, however, that money will go directly toward paying off your loans while they continue to accrue interest.

It is possible to get both if you meet all eligibility requirements—but only if there is enough money in your account at the end of each month after all other bills have been paid (including rent). If this happens, contact one of our specialists immediately so we can work with them on an arrangement that works well for everyone involved!

We hope we’ve helped you understand what happens when you get a PPP loan and unemployment at the same time, as well as how to make sure that doesn’t happen to you. If you have any questions please contact us today!

DISCLAIMER: This article is for informational purposes only and is not intended to be legal or tax advice. Talk to a licensed attorney, tax advisor, accounting advisor, or whoever is appropriate, about your own specific situation.