The Covered Period begins on the date the loan was originally disbursed (the "Disbursement Date"). It ends on a date selected by the Borrower that is at least 8 weeks following the date of loan disbursement and not more than 24 weeks after the date of loan disbursement.
Most borrowers will use a 24-week Covered Period as that provides more time during which they can spend their PPP loan on forgivable expenses.In addition to considering whether a borrower spent, or expects to spend, their PPP loan funds within a given period of time, other considerations that a borrower may want to account for when selecting the duration of their Covered Period include:
- Whether they reduced, or expect they may need to reduce, any employees’ salary or wages and if so, when
- Whether they laid off and/or re-hired any employees or expect to do so, and if so, when
A borrower's particular business circumstances will inform which duration works best and we recommend consulting a business or tax advisor if you have questions about your specific business.