The U.S. Small Business Administration (SBA) and Treasury has announced that lenders with $1 billion or less in assets will be able to open applications for the next round of Paycheck Protection Program (PPP) funding starting Friday, Jan. 15 at 9 a.m. ET. Both first and second-draw loans will be able to apply at that time. For large lenders, the application opens on Tuesday, Jan. 19 for first and second-draw loans.
Community financial institutions (CFIs) began accepting applications for underserved small businesses on Jan. 11 for first-draw loans and Jan. 13 for second-draw loans. More than 9,100 applications were submitted so far totaling over $1.4 billion of the $284.5 billion available in this round of funding.
As a reminder, the second round of PPP funding expanded certain provisions of the original program including:
- Expanded eligibility for nonprofits, independent contractors/sole proprietors/self-employed individuals, certain businesses eligible for other SBA 7(a) loans, accommodation and food services, business leagues with a Sec. 501(c)(6) designation, and news/nonprofit public broadcasting organizations.
- Expanded eligible costs including COVID-related worker protection and facility modifications; property damage costs related to public disturbances; suppliers expenditures essential to operations; operating expenditures for software/cloud computing services essential for running the business.
- Simplified applications for first-draw loans of $150,000 or less.
- Repeal of Economic Injury Disaster Loan advances (EIDL) deduction from forgiveness amount.
- Repeal of duo claims on a PPP loan and the employee retention tax credit program – Businesses can qualify for both.
- Allowance for second-draw PPP loans if a business has maxed out the first, has fewer than 300 employees, and a 25% reduction in revenue for any quarter in 2020.
- Allowance of expenses paid with a PPP loan to be tax deductible.
You can read more about the provisions of the second round of PPP funding in our blog. Contact us for assistance with a first or second-draw PPP loan and your forgiveness application.