SBA PPP Small Business Loans: Second PPP Funding Round for SMBs
Saturday, July 25, 2020:
- PPP Loan Forgiveness Forms: Lenders can begin submitting applications for Paycheck Protection Program loan forgiveness Aug. 10. The Small Business Administration, which oversees the Covid-19 relief program, announced the update on July 23 in a document outlining procedures for the loan forgiveness process. Source: Silicon Valley Business Journal, July 24, 2020.
Friday, July 24, 2020:
- Alleged PPP Loan Fraud: Mukund Mohan, a former executive at Amazon and Microsoft, was arrested and charged by the U.S. Attorney’s Office with forging documents to fraudulently acquire more than $5.5 million in coronavirus relief funds. Source: Seattle Times, July 23, 2020.
Tuesday, July 21, 2020:
- PPP Loan Forgiveness Application Tool: Biz2Credit has launched a PPP loan forgiveness application tool to help businesses simplify the task of seeking PPP forgiveness.
Monday, July 20, 2020:
- Treasury Secretary Steven Mnuchin told lawmakers on July 17, 2020 that they should consider automatic forgiveness for many loans under the Paycheck Protection Program, the $670 billion government-backed rescue of small businesses. Source: Politico, July 17, 2020.
Monday, July 6, 2020:
- Small businesses now have until August 8 to apply for a PPP loan, according to legislation that President Trump signed into law on July 4. Source: ChannelE2E.
Thursday, July 2, 2020:
- The US House passed an extension of the $660 billion Paycheck Protection Program fewer than 24 hours after the program shut its doors, moving one step closer to reopening the cornerstone small business coronavirus relief effort. More than 4.8 million small businesses tapped more than $520 billion in potentially forgivable loans through the program. However, more than $130 billion in allocated funds remained unused at the time of the program’s closure on June 30. Source: CNN, July 1, 2020.
Friday, June 26, 2020:
- The Paycheck Protection Program had more than $100 billion in funding left as of June 20, with only days remaining until the SBA stops taking new applications on June 30. Source: Bloomberg, June 25, 2020.
Monday, June 22, 2020:
- PPP Loans and Owner Salary Limits: The Small Business Administration has officially expanded the amount business owners can pay themselves and their employees and still get full forgiveness for Paycheck Protection Program Loans. But there’s a catch involving owner salary limits. Owners — those with self-employment income who file a Schedule C or F form with their taxes — are instead capped at a much lower $20,833 over the 24-week period, which amounts to $868 weekly for that full span. Owners can pay themselves more, but it just won’t count toward forgiveness of the loan. Source: Silicon Valley Business Journal, June 18, 2020.
Tuesday, June 16, 2020:
- New PPP Guidance From SBA: The latest SBA guidance for receiving a PPP loan involves these three links:
- Click here to view the new Interim Final Rules.
- Click here to view the new Borrower Application.
- Click here to view the new Lender Application.
Monday, June 15, 2020:
- PPP Payback Estimation Tools: Paychex has launched a PPP Loan Forgiveness Estimator and Forgiveness Report in its cloud-based HR suite, Paychex Flex. The goal: Simplify the PPP application process for customers and provide them the accurate information needed to satisfy the new forgiveness requirements.
Sunday, June 7, 2020:
President Donald Trump on June 5 signed PPP loan forgiveness changes into law. The changes, summarized by Silicon Valley Business Journal, include these seven updates:
- PPP Spending Timeline: Extend the “covered period” under which small businesses can spend the loan proceeds from eight weeks to 24 weeks, or until December 31, 2020.
- More Staffing Flexibility: Remove the limits on loan forgiveness for small businesses that were unable to rehire employees, hire new employees or return to the same level of business activity as before the virus.
- Qualified Spending on Non-Payroll Items: Expand the 25% cap to use PPP funds on nonpayroll expenses, such as rent, mortgage interest and utilities, to 40% of the total loan. That lowers the 75% requirement for payroll expenses to 60% to get maximum forgiveness.
- Tax Credit Flexibility: Allow small businesses to take a PPP loan and also qualify for a separate, recently enacted tax credit to defer payroll taxes, currently prohibited to prevent “double dipping.”
- Longer Payback Timeline: Extend the loan terms for any unforgiven portions that need to be repaid from two years to five years, at 1% interest.
- Longer Rehire Timeline: Give small businesses more time to rehire employees or obtain forgiveness for the loan if social-distancing guidelines and health-related actions from the Centers for Disease Control and Prevention or other agencies prevented the business from operating at the same capacity as it had before March 1.
- Loan Forgiveness Changes: Extend the period for when a business can apply for loan forgiveness, from within six months to within 10 months of the last day of the covered period, before it must start making interest and principal payments. Under the new bill, PPP loan interest and payment of principal and fees will be deferred until the loan is forgiven by the lender.
Thursday, June 4, 2020:
- PPP Loan Forgiveness – Senate Approval: The Senate passed a bill on June 3 to give small businesses more flexibility in how they spend federal loans given as part of a coronavirus aid program, CNBC reports. It now heads to President Donald Trump’s desk, and he’s expected to sign the bill into law.
- The bill includes these changes, CNBC notes: (1) small businesses would have to spend 60% of the loan money on payroll instead of the previous 75%. (2) They could use the funds for six months, a change from two months. (3) The proposal would extend a June 30 deadline to rehire workers. (4) It would also push back the timeline for repaying loans, and allow companies that get loan forgiveness to defer payroll taxes.
Wednesday, June 3, 2020:
- PPP Loan Forgiveness – Senate Perspectives: Key Senate Republicans are throwing their support behind a bipartisan House bill that would give small businesses more time to use Paycheck Protection Program loans and let borrowers spend less of their loan proceeds on payroll, according to MarketWatch. The measure would extend the period for using loans to 24 weeks and let borrowers spend just 60%, rather than 75%, of their loan proceeds on paying workers, the report says.
Friday, May 29, 2020:
- PPP Loan Forgiveness – Pending Legislation: The U.S. House approved legislation on May 28 making it easier for small businesses and other recipients of PPP funding to qualify for forgiveness of the loans, the Journal of Accountancy reports. Here are the details.
Read earlier PPP updates by visiting the next page….