Latest COVID-19 Relief Package Info*
The latest COVID relief bill has been signed into law – and economic relief for communities, small businesses, families and individuals is coming our way. You should be aware of several Paycheck Protection Program (PPP) enhancements and other Small Business Administration program provisions included in the package.
*Note: This reflects our best understanding of the relief programs as of 12/28/2020. Any additional guidance from the SBA, IRS and U.S. Treasury Department may require updates to this information.
Relief Bill Provisions
What is in the relief bill for me? $600 direct economic impact payments are included for individuals with income up to $75,000, $1200 payments for couples making up to $150,000/year and a payment of $600 for each dependent.
Payments will be coming soon from the US Treasury.
Will unemployment insurance be extended? The bill provides $300 per week in expanded unemployment insurance through March 14, 2021.
Paycheck Protection Program (PPP) Second Draw
Am I eligible for a second draw PPP loan? Eligible borrowers:
--Less than 300 employees
-- Must have at least 25% reduction in quarterly revenues compared to 2019
-- Stock not traded on national exchange
What is the maximum PPP loan amount? Maximum loan:
-- 2.5 X average monthly payroll or $2 Million, whichever is less
-- Restaurant & hospitality businesses are eligible for loans at 3.5 X average monthly payroll
What is the interest rate and term? 1% for 5 years What can I spend PPP loan proceeds on for them to be forgiven? Payroll, Utility Expenses, Rent, Personal Protective Equipment Expense, costs associated with outdoor dining, and supplier costs. Payroll expenses must comprise no less than 60% of eligible expenses.
Original PPP & SBA Programs
Has anything changed with PPP forgiveness? For PPP loans of less than $150,000, borrowers submit a one page attestation of compliance with program requirements. What if I received an Economic Injury Disaster Loan (EIDL) advance from the SBA? The CARES ACT provision that required borrowers to deduct the advance from their PPP forgiveness has been repealed. Are my expenses deductible on my taxes Business expenses paid with forgiven PPP loan proceeds may now be deducted from taxable income. Are there changes to the SBA Economic Injury Disaster Loan program? Congress granted the SBA $20 Billion to restart and extend the program What about existing SBA loan programs? The bill provides $3.5 Billion to resume Principal & Interest payments for new and existing small business loans guaranteed by the SBA under 7(a), 504 and Microloan programs through March 31, 2021.
Borrower and lender fees will be waived for 7(a) and 504 loan programs.