President Joe Biden just announced there will be a 2-week period starting on Wednesday, February 24, 2021, during which only businesses with less than 20 employees will be able to apply for a Paycheck Protection Program (PPP) loan.
The White House is hoping to further target the PPP Loan to the smallest businesses. The administration said the 14-day exclusive application period is designed to help the 98% of small businesses that have fewer than 20 employees. The administration will also:
- Change the PPP loan calculation formula to help sole proprietors, independent contractors, and self-employed individuals receive more financial support.
- In addition, $1 billion will be set aside for businesses in this category that don’t have employees and are located in low- and moderate-income areas.
- Eliminate a restriction preventing small business owners with prior non-fraud felony convictions from obtaining relief through the PPP.
- Remove a rule preventing small business owners who are delinquent on federal student loan payments from securing a PPP loan.
- Allow non-citizen small business owners who are lawful U.S. residents to use individual taxpayer identification numbers (ITINs) to apply for relief.
The White House also said that the administration would continue to work with lenders to address PPP processing delays. The administration also will make the following moves:
- Update key areas of SBA websites to help more applicants find resources for understanding relief options and completing applications.
- Continue to conduct stakeholder outreach to learn more about challenges and opportunities in the implementation of current emergency relief plans.
- Launch a new initiative to increase communication with lenders and provide opportunities for lenders to make recommendations and ask questions about the PPP.
The SBA has approved more than 1.9 million PPP loans for a total of $40 billion from January 11, 2021 through February 21, 2021. The application window for the current $284 billion 2nd round PPP is scheduled to close March 31, 2021.
Reach Out To Us: Our accountants played a large role in helping many of our clients receive Paycheck Protection Program loans last year. Now, the PPP is back and better, and clients will again need advice and assistance in accessing the 2nd program. We can help you figure out if you are eligible and should apply, whether a 1st time or 2nd time borrower, and how to maximize your forgiveness. We will continue to provide additional information as it becomes available. Call us toll free 855-542-7537, or email CPA@Fuoco.com.
