PPP 2.0 Rolling Out This Week
Banks will begin taking applications sometime this week.
The new law allows some businesses to apply for a second loan. To qualify, businesses
must have spent all of their first loan, have less than 300 employees and prove that they
lost 25% or more of revenue in any quarter in 2020 either on a quarterly or annual
basis.
Businesses will need to have their 2019 tax return on hand as well as profit and loss
records to show that they’ve had at least one quarter where revenue fell 25% or more.
These second loans will be made on a similar recommendation to the first round of PPP
2.5 times payroll costs and will also be capped at $2 million.
Food service and accommodation industries (hotels & restaurants) that are businesses
classified under the North American Industry Classification System (NAICS) beginning
with the number 72 are eligible for loans that amount to 3.5 times their average monthly
payroll.
Borrowers are still required to spend at least 60% of the funds on payroll over a covered
period of either 8 or 24 weeks to receive full forgiveness.
The other 40% may be used on eligible costs, including certain mortgage expenses, rent
and utility payments. Under the renewed program, the list of eligible non-payroll
expenses has been expanded to include four new categories, including:
• Costs for personal protective equipment and adaptive investments that help a
PPP loan recipient comply with federal and/or health and safety guidelines
related to COVID-19
• Costs incurred on software, cloud computing, human resources, and accounting
needs.
• Any spending not covered by insurance that are related to property damage due
to public disturbances that occurred during 2020.
• Spending to suppliers that covered costs essential to the business operations at
the time the expense occurred.
PPP Application Link:
PPP Second Draw Borrower Application Form (1.8.2021) (1)
Emergency Injury Disaster Loan- Businesses can apply at https://covid19relief.sba.gov/#/
Here is a video tutorial with step by step instructions: https://www.mssbdc.org/resources/business_resilience_information
Who can apply?
- If you are a business under 500 employees
- NAICS Sector Code 72-Food & Accommodations(Given Preference)
- Have a Good Credit History
- Physically Located in County of the disaster
What Can Funds Be Used For?
- Working Capital
- Debts
- Payroll
- Accounts Payable
- Rent
- Utilities
- Other Bills
- Does not cover costs for Expansion
Up to $2 million at 3.75% interest for businesses with terms of up to 30 years. If you are applying for over $25,000 you must have collateral. Business owners can also apply for an up to $10,000 cash advance grant through this loan program.
Here is your checklist to get all materials needed together in order to apply: http://itawambams.com/wp-content/uploads/2020/03/SBA-Disaster-Checklist.pdf
Paycheck Protection Program for Small Businesses-
The Paycheck Protection Program prioritizes millions of Americans employed by small businesses by authorizing up to $349 billion toward job retention and certain other expenses.
Small businesses and eligible nonprofit organizations, Veterans organizations, and Tribal businesses described in the Small Business Act, as well as individuals who are self-employed or are independent contractors, are eligible if they also meet program size standards.