Paycheck Protection Program (PPP) Re-Launch Overview
Summary
An SBA presentation, Paycheck Protection Program Re-Launch Overview, current as of January 14, 2021. It gives a general overview of the PPP under the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act, and states that where it is inconsistent with the official guidance, including the Economic Aid Act, the PPP Flexibility Act of 2020, the CARES Act, PPP IFRs and PPP FAQs, the official guidance governs. Its agenda covers key dates, First Draw PPP Loans, Second Draw PPP Loans, forgiveness updates, and what to do now.
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Paycheck Protection Program
Re-Launch Overview
Current as of January 14, 2021
This presentation provides a general overview of the PPP related to provisions in the Economic Aid to Hard-Hit Small
Businesses, Nonprofits, and Venues Act (the Economic Aid Act). In the event of any inconsistency between this
presentation and the Economic Aid Act, the PPP Flexibility Act of 2020, the CARES Act, PPP IFRs, PPP FAQs, PPP
Application Forms and Instructions, and other PPP guidance (together, official guidance), the official guidance governs.
Information Current as of 1/14/21 – Visit www.sba.gov/ppp for the most up-to-date information.
Agenda
1 Where We Are / Key Dates
2 First Draw PPP Loans
3 Second Draw PPP Loans
4 Forgiveness Updates
5 What to do Now / Additional Resources
Information Current as of 1/14/21 – Visit www.sba.gov/ppp for the most up-to-date information.
Congress intended this round of PPP to increase access to COVID relief
funding for the hardest-hit small businesses and those in underserved
segments, including women, minorities & veterans. In response, the SBA is:
• Initially opening PPP loan applications to submissions from Community
Where Financial Institutions, which serve underserved communities.
We Are • Leveraging its Lender Match platform so borrowers can find these and
other participating PPP lenders.
• Continuing to provide trainings, materials and assistance via SBA field
offices and its resource partners across the country.
Information Current as of 1/14/21 – Visit www.sba.gov/ppp for the most up-to-date information.
Paycheck Protection Program Key 2021 Dates
• Jan. 11: PPP opened for First Draw PPP loan What is a CFI?
Community Financial Institutions include:
applications from Community Financial Institutions • Community Development Financial
Institutions
• Jan. 13: PPP opened for Second Draw PPP loan • Minority Depository Institutions
applications from CFIs • Certified Development Companies
• Microloan Intermediaries
• Jan. 15: PPP opens for First and Second Draw
applications to lending institutions with $1 billion or
less in assets
• Jan. 19: PPP opens First and Second Draw
applications to all other participating lending
institutions
• March 31: All PPP applications must be submitted
Information Current as of 1/14/21 – Visit www.sba.gov/ppp for the most up-to-date information.
What is a First Draw PPP Loan?
For eligible applicants that did not receive a PPP loan prior to Aug. 9, 2020
• PPP loan eligibility now includes additional types of entities.
• Covered eligible expenses are expanded.
• Borrowers can now select a covered period to use PPP loan proceeds anytime
between 8 and 24 weeks after disbursement.
• Certain borrowers may request an increase to their original PPP loan amount.
• Must apply on or before March 31, 2021, or until Congressional
appropriations expire.
Information Current as of 1/14/21 – Visit www.sba.gov/ppp for the most up-to-date information.
First Draw PPP Loan Eligibility
Must comply with size standards, eligibility criteria & certain limitations
Newly Eligible
• Housing cooperatives
• Destination marketing organizations
• Certain 501(c)(6) organizations such as Chambers of Commerce
• Eligible news organizations
Still Eligible
• Business entities (e.g., partnerships, corporations, LLCs)
• Sole proprietors, independent contractors, self-employed individuals
• 501(c)(3) non-profit organizations
• 501(c)(19) Veterans organization
• Tribal businesses
Information Current as of 1/14/21 – Visit www.sba.gov/ppp for the most up-to-date information.
What is a Second Draw PPP Loan?
For borrowers that previously received a PPP loan, have 300 employees
or less, and suffered a 25% reduction in gross receipts
• For most borrowers, the maximum loan amount of a Second Draw PPP loan is
2.5x average monthly 2019 or 2020 payroll costs, up to $2 million.
• For borrowers in the Accommodation and Food Services sector (NAICS 72), the
maximum loan amount for a Second Draw PPP loan is 3.5x average monthly
2019 or 2020 payroll costs, up to $2 million.
• Second Draw PPP loan applicants must submit the information on SBA Form
2483-SD (Borrower Application) when applying to their lender.
Information Current as of 1/14/21 – Visit www.sba.gov/ppp for the most up-to-date information.
Second Draw PPP Loan Eligibility
Must have previously received a First Draw PPP loan
Additional Eligibility Criteria
• Has used or will use the full First Draw PPP loan amount only for eligible
expenses before the PPP Second Draw Loan is disbursed
• Has no more than 300 employees
• Can demonstrate at least a 25% reduction in gross receipts between
comparable quarters in 2019 and 2020.
Information Current as of 1/14/21 – Visit www.sba.gov/ppp for the most up-to-date information.
PPP Loan Forgiveness
Borrowers must apply for forgiveness through their lender;
lenders submit borrower forgiveness decisions to the SBA
Updates per the Economic Aid Act
• EIDL Advances are no longer deducted from forgiveness payment.
• Forgiven PPP loans are not taxable income; expenses paid with PPP loan
funds are now tax deductible; consult the IRS for details
• Expanded forgivable expenses are permissible for any PPP loan not
already forgiven.
• Coming soon: simplified forgiveness application for PPP loans $150,000
and under.
Information Current as of 1/14/21 – Visit www.sba.gov/ppp for the most up-to-date information.
What to do Now & Additional Resources
What to do Now Additional Resources
• Contact your lender • Contact your local SBA District
• If you do not have a lender, Office or Resource Partner:
find one on Lender Match: sba.gov/local-assistance
sba.gov/LenderMatch • Subscribe to SBA e-newsletter:
• Visit www.sba.gov/ppp for the www.sba.gov/updates
most up-to-date documents • Follow SBA on Twitter: @SBAgov
Contact us
(XXX) XXX-XXXX District@sba.gov
Information Current as of 1/14/21 – Visit www.sba.gov/ppp for the most up-to-date information.
Questions
Information Current as of 1/14/21 – Visit www.sba.gov/ppp for the most up-to-date information.
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