Whether payments to independent contractors constitute 'payroll costs' under the Paycheck Protection Program for businesses with no W-2 employees

Congress enacted the Paycheck Protection Program (“PPP”) to fund “ payroll costs ” in order that small businesses stay afloat during the COVID -19 pandemic. “Payroll costs” are defined to include “ the sum of payments of any compensation to or income of a sole proprietor or independent contractor. ” Veltor Underground , LLC (“Veltor”) a small business with no W-2 employees, used its PPP loan to pay independent contractors who performed its core services. SBA denied forgiveness, determining that such payments do not count as “ payroll costs. ” The district court agreed with SBA’s determination and the Sixth Circuit affirmed. The question presented is whether “the sum of payments of any compensation to or income of a sole proprietor or independent contractor that is a wage, commission, income, net earnings from self employment, or similar compensation” includes payments a business with no employees makes to independent contractors on its payroll who provide the business’s core services.