Significant Changes Announced for Pay Check Protection Program (PPP)
The Biden Administration recently announced substantial changes to the PPP– forgivable loans to businesses struggling during the COVID-19 pandemic.
From now until March 9th, small businesses with fewer than 20 employees will have the exclusive opportunity to apply for first and second draw PPP loans with lenders. This move was designed to give the smallest businesses, many of which are minority- and women-owned, a better opportunity to get an application approved. The rules have not changed. Other businesses can apply after that time and should be ready to go after March 10th when the window to apply opens up for all other businesses. All companies have the opportunity to apply for loans until March 31, 2021. In the second round of PPP, you need to show a revenue loss of 25% in gross receipts in a calendar quarter in 2020 during the same calendar quarter in 2019—and this applies across the board for eligibility for PPP.
For independent contractors, self-employed and sole proprietors, PPP relief eligibility is now expected to be broadened. It is now expected to be based on your gross income to calculate the value of your PPP loan. This may take effect next Monday, March 1st. Wait until it takes effect to apply.
Talk to your tax preparers now to make sure you are taking advantage of the Employee Retention Tax Credit (ERTC).
It is still an option to apply for Economic Injury Disaster Loans (EIDL) through SBA. The SBA is reaching out to those who did not get the full $10,000 EIDL grant. They will reach out to you if they think you are eligible.
Shuttered venue grants are still not open on the SBA website.
The American Rescue Plan is going through Congress now and has even more funds proposed to help the hardest hit small businesses with grants and more loans.
Click here to listen to the update from the U.S. Chamber of Commerce about these new changes and get the answers to other coronavirus business aid options.