Late in the evening on Monday, both the House & Senate passed a sweeping stimulus package. The President is expected to sign it very soon.
This stimulus package does include a new round of PPP Loan funds. While we haven’t had a chance to review the entire 5300 page document, here is a quick summary of what we know right now.
Please know that it will likely take the SBA and banks a few weeks to re-launch this round of funding. We will send out more information as details are announced.
Who Can Apply?
- Businesses, some nonprofits and self employed individuals with less than 300 employees.
- Existing borrows may apply for a second round.
- You must demonstrate that you’ve experienced a 25% reduction in gross revenue during any quarter in 2020 compared to the same quarter in 2019.
How Much Am I Eligible For?
- Similar to the previous round of PPP, businesses may apply for up to 2 1/2 times your average monthly payroll costs.
- NEW: Accomodations & Food Industry businesses may apply for up to 3 1/2 times your average monthly payroll costs.
What can I spend the money on?
- Same as before, you must spend at least 60% of the funds on payroll.
- You may also spend the funds on mortgage interest, rent and utility payments.
- NEW: PPE, supplier costs, operations expenditures, damage repair are now forgivable expenses.
- The forgiveness process presumably will be similar to the last round.
One of the biggest pains of the previous PPP was that expenses paid for with PPP funds were no longer deductible for tax purposes. This law changes that rule, and allows PPP funds to be virtually tax free at the federal level. State taxes may still apply.
When Can I Apply?
The SBA and banks must re-design and re-open this program in the coming weeks. Stay tuned for more information. We will send more out as information is released!
Will Paper Trails help me apply for the new loan and apply for forgiveness when the time comes?
Yes, just as we helped in the last round, we’re happy to help you apply for the funding. When it comes time for forgiveness, we will be happy to again prepare forgiveness documents on your behalf.