second ppp loan update

Of course, there are extra qualifications for a second draw loan beyond the eight-week time period. The guidance is structured in the form of 24 questions and answers addressing a variety of situations. Second Draw PPP loans made to eligible borrowers qualify for full loan forgiveness if during the 8- to 24-week covered period following loan disbursement: Employee and compensation levels are maintained … People love getting their PPP funding through Womply because we know what we’re doing and they love the assistance we provide. What PPP borrowers can do if there was an application error that resulted in a borrower receiving a PPP loan amount that exceeds the borrower’s correct maximum loan amount. Documents required to substantiate payroll costs used to determine your maximum second-draw PPP loan amount. these are footer comments that i need to show up, PPP Loan Application + Forgiveness Assistance, Cybersecurity + Remote Workforce Consulting, Corporate Tax Consulting & Compliance | Credits & Incentives, Buy-Side And Sell-Side Transaction Services, Bankruptcy | Restructuring | Turnaround | Wind Down, Litigation Support | Forensic Accounting Services, Mediation | Arbitration (Alternative Dispute Resolution), Corporate Accounting | Accounting Support. Read more about the latest 1040 Schedule C/PPP loan rules changes, and see the new rules, and the new PPP application form for Schedule C applicants. We are working diligently to provide the most current information as it becomes available under our COVID-19 Actionable Insights For Businesses Series. However, not ALL businesses that got PPP funding in the first round will be eligible for a second-draw PPP loan. The PPP loan had reopened last January 11, 2021. The primary difference with the PPP loan update is that it not only offers first-time loans to eligible businesses but also second-time loans to eligible businesses that received and used their first PPP loan last year. Know all your customers and target the right ones, every time. In general, the rules for second-draw PPP loan forgiveness are the same as first-draw PPP loan forgiveness. As of March 30, 2021, the SBA says you have to wait at least 8 weeks from getting your PPP first draw funds to be able to apply for PPP loan second draw, but we have seen otherwise. Calculation considerations for businesses not in operation a full year prior to February 15, 2020. The program will be open to all eligible entities March 10 through March 31, 2021. In addition to providing employee benefit plan and 401(k) audits, we offer innovative and practical solutions to the real estate, construction, healthcare, transportation, manufacturing and convenience store industries. Get your PPP loan or second draw PPP loan through Womply! After that, the SBA will only process existing applications that have already been submitted, until the PPP deadline of June 30, 2021. Whether you now take your first or second PPP loan, these loans will have the same terms as the original PPP loan. Here is a snapshot of some of the items the new guidance covers: Updated PPP Loan Forgiveness Applications and Rules: New guidance on the PPP loan forgiveness application includes the release of four new / updated forms: In addition to the PPP loan forgiveness application forms, the SBA also released an interim final rule (IFR) that consolidated prior PPP loan forgiveness rules and changes made by The Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act, P.L. In addition to the guidance on PPP loan calculations and the forgiveness application, the SBA has provided further guidance on the following key areas of the PPP: We realize that PPP loan calculations and forgiveness applications can be complex. This can make a big impact on the amount you can borrow, depending on how much you make and how you have reported your profits. Starting in January 2021, small businesses will be able to apply for PPP loans even if they got funding in 2020 under the PPP program. First-draw PPP loan calculations and required documentation by business type. Second Draw PPP Loan Updates for Small Business Owners In 2021, a second round of Paycheck Protection Program (PPP) funding gives small businesses another chance at stimulus relief as the country continues to battle the effects of Covid-19. The fees are paid by the SBA, not by the borrower. Who is eligible for a PPP loan? Amid COVID-19 economic fallout, many small businesses with 500 or fewer employees need to navigate the CARES Act and Paycheck Protection Program (PPP) for emergency loans and grants. IMPORTANT NOTE: As of March 3, 2021, applicants who report their income with IRS Form 1040 Schedule C (i.e., most independent contractors, 1099 workers, and sole proprietors) will be able to use their GROSS (instead of net) profits to determine their max loan amount. $2 million. Eight of the 24 questions deal with how to determine if a PPP borrower experienced the 25% decline in gross receipts required to apply for a second-draw PPP loan. Under current guidelines, a PPP loan for a business with employees and on a payroll system is calculated by taking one month of payroll and multiplying that figure by 2.5. Since you don't have the option to get the PPP modal on your QuickBooks Desktop, I would recommend checking this with our PPP Support. We also provide services to help businesses during the COVID-19 crisis, including PPP loan forgiveness calculation assistance, cash flow projections, business recovery and bankruptcy services. Send discount, promotional, and transactional emails, automatically. Please note, though the PPP application deadline is being extended, you only have until May 31, 2021 to get your application submitted to the SBA. An SBA-backed loan that helps businesses keep their workforce employed during the COVID-19 crisis. We’ve helped over 200,000 businesses, contractors, sole proprietors, and self-employed individuals get connected with an approved SBA lender and get funded. Don’t wait! Sarah Foster, 49, runs a jewelry and design store in Prescott, Arizona, and is one of the sole proprietors who would have benefitted from the new loan formula. Second draw PPP loans (if you got a PPP loan in 2020), Must be able to demonstrate a 25 percent or greater reduction in revenue in 2020 vs. 2019, and. The new law also allows some businesses to apply for a second loan. And a second round of PPP funding round surfaced in early January 2021. Small businesses and non-profits with fewer than 20 employees and sole proprietors can apply for Second Draw PPP loans from February 24 through March 9, 2021. Has received a “first draw” PPP loan and has used, or will use, the full amount of the initial PPP funding on or before the expected date on which the Second Draw PPP Loan is disbursed to you, and, Has used the full amount of your first PPP Loan on eligible expenses under the PPP rules. Regarding reapplying and PPP loan increases: Existing “first draw” PPP borrowers that did not receive loan forgiveness by December 27, 2020 may: (1) reapply for a First Draw PPP Loan if they previously returned some or all of their First Draw PPP Loan funds, or (2) under certain circumstances, request to modify their First Draw PPP Loan amount if they previously did not accept the full amount for which they are eligible. Bert Mills, CPA, is the Managing Partner at Moore Colson. Obviously the intent here is to prioritize smaller businesses without millions of dollars of payroll costs. In this 2-minute read: The Paycheck Protection Program Extension Act of 2021 extends the PPP to the end of June, […], In this 7-minute read: Can developers, programmers, coders and other IT professionals apply for the PPP loan? Hello All, I wanted to provide update to the sub on my 2nd PPP loan progress. These include but are not limited to: The SBA guaranteeing 100% of the loans Small businesses must have no more than 300 employees and be able to show at least a … Guidance related to this also includes: How the following types of businesses should calculate their second-draw PPP loan maximums: self-employed (with or without employees), partnerships, S corporations, C corporations, nonprofit organizations, religious institutions, veterans organizations, tribal businesses and LLC owners. (You can’t borrow PPP money to pay back a $10K EIDL “grant” for example, since the EIDL grant is forgivable.). In order to qualify for application for a second-draw PPP loan, your business: IN GENERAL the maximum loan amount for a Second Draw PPP Loan is equal to the lesser of: A. two and half months of the borrower’s average monthly payroll costs; or B. Eligible businesses with 500 or fewer employees—including nonprofits, veterans organizations, tribal concerns, faith-based organizations, self-employed individuals, sole proprietorships, and independent contractors—can apply for first-draw PPP loans. To promote access to capital, initially only community financial institutions will be able to make First Draw PPP Loans on Monday, January 11, and Second Draw PPP Loans on Wednesday, January 13. PPP borrowers can set their PPP loan’s covered period to be any length between 8 and 24 weeks to best meet their business needs; PPP loans will cover additional expenses, including operations expenditures, property damage costs, supplier costs, and worker protection expenditures; The Program’s eligibility is expanded to include 501(c)(6)s, housing cooperatives, destination marketing organizations, among other types of organizations; The PPP provides greater flexibility for seasonal employees; Certain existing PPP borrowers can request to modify their First Draw PPP Loan amount; and. What can personal trainers, fitness instructors, dietitians, weight loss counselors, […], In this 8-minute read: Can farmers, ranchers, and other agricultural producers get the PPP loan? It’s free to apply for a PPP loan, and Womply can help connect you with an SBA lender that’s right for you! PLEASE NOTE: it is free for businesses to apply for PPP loans. How much can food truck […], In this 7-minute read: What types of cruise ship workers are eligible for the PPP loan? How to demonstrate a gross receipts reduction if you are using your company’s annual income tax returns. Andy Starnes, CPA, is a Partner and Tax Services Practice Leader Moore Colson. You may apply for second-draw PPP loan forgiveness if during the 8 to 24 week period following loan disbursement: Eligible businesses can apply for a first or second draw PPP loans via SBA-approved lenders until May 31, 2021. December 22, 2020. This will hopefully spread more of the PPP funding to a broader portion of America’s truly small, local businesses (and the community lenders that serve them). 133) (the “Act”). The guidance for second-draw PPP loan calculations and the documents borrowers must provide to support each set of calculations came in the form of an 18-page document. So if your average monthly payroll over the last 12 months was $100,000, you could borrow up to $250,000. The updated Frequently Asked Questions provides additional clarity to these topics: Lobbying activities by PPP recipients; The impact of a borrower’s bankruptcy on loan forgiveness and eligibility for a second draw loan; In late December 2020, congress approved a $284 billion renewal of the PPP (Paycheck Protection Program) loan program under the CARES act, in order to help provide relief to American businesses still struggling due to the COVID-19 pandemic’s financial impact. It’s free to apply for a PPP loan, and Womply can help connect you with an SBA lender that’s right for you! jdsupra.com • 1d. January 28, 2021. We will update this site with more details in the coming days. The PPP is being extended! Paycheck Protection Program Second Draw Loan Borrower Application Form Andy’s specialties include corporate tax compliance and planning, business consulting and multi-generational planning with a focus on the construction, professional services and staffing industries. January 21, 2021 | Blog, COVID-19 Strategy Hub | Bert Mills, CPA; Andy Starnes, CPA; and Chris Arnone, CPA. In addition, the SBA and congress have modified some of the requirements and rules in response to criticism that larger borrowers who used bigger banks had an advantage over smaller borrowers using less established banks during the first several rounds of PPP funding during 2020. The following blog post discusses each of these updates and highlights what your business needs to know. Ready to Lend on PPP Loans. Disclaimer: This information was correct at the time of publication; however, new guidance from government agencies may be issued at any time, causing some or all of this information to change. Let’s go over the basics of the PPP program and the differences for 2021. Womply has helped over 200,000 businesses get their PPP funding. Starting in January 2021, small businesses will be able to. Contact us for more information. At least 60 percent of the proceeds are spent on payroll costs. Moore Colson, an Atlanta-based Certified Public Accountant, is a top award-winning tax, audit and consulting firm that focuses on serving the needs of mid-market and Fortune 500 companies. You can also view all lenders near you on a map. First draw PPP loans (if you didn’t get a PPP loan in 2020), Regarding reapplying and PPP loan increases: Existing “first draw” PPP borrowers that did not receive loan forgiveness by December 27, 2020 may: (1) reapply for a First Draw PPP Loan if they previously returned some or all of their First Draw PPP Loan funds, or (2) under certain circumstances, request to. On January 19, 2021, the U.S. Small Business Administration (SBA) and Treasury released guidance for how Paycheck Protection Program (PPP) borrowers should calculate revenue reduction and maximum loan amounts for second-draw PPP loans and published updated PPP loan forgiveness guidance and forms. Second Draw PPP loans – The Economic Aid Act authorizes a second round of PPP loans (called “Second Draw loans”) to borrowers who have already received a PPP loan. Borrowers applying for a second draw Paycheck Protection Program (PPP) loan must make the same uncertainty certification (sometimes referred to as the “necessity certification”) that they made in connection with their first draw PPP loan: “Current economic uncertainty makes this loan request necessary to support the ongoing operations of the Applicant.” The terms and conditions of the Second Draw PPP Loans are subject to the same terms and conditions as First Draw PPP Loans. Since America’s small businesses are still in dire straits due to the devastating impact of the ongoing COVID-19 pandemic, the SBA is allowing some first-time recipients to apply for a second round of PPP loan funding. The second loan can be up to 2.5 times the business’ average monthly payroll costs, up to a $2 million loan maximum (or $4 million for a corporate group) Accommodations and Food Services companies with NAICS code 72 can borrow up to 3.5 times the business’ average monthly payroll costs, up … The Moore Colson team is available to help your business navigate the PPP. Chris has over 20 years of experience providing audit, accounting and consulting services for companies in the transportation, manufacturing, distribution, staffing, private equity and venture capital industries. PPP Loan Forgiveness Update. Learn more, plus get free reputation monitoring and customer insights when you sign up for Womply Free! $25 billion is also being set aside for eligible borrowers with a max of 10 employees or smaller loans of $250,000 or less to eligible borrowers in low- or moderate-income neighborhoods. Paycheck Protection Program (PPP) loans: Round 2 update. Second Draw applicants are eligible if they (1) previously received a First Draw PPP loan and will or have used the full amount only for authorized … Chris Arnone, CPA, is a Partner and Business Assurance Practice Leader at Moore Colson. First Draw PPP Loans made to eligible borrowers qualify for application for full loan forgiveness (you don’t have to pay it back) if during the 8- to 24-week covered period following loan disbursement: For first-time PPP borrowers, you may borrow 2.5 times your average monthly payroll costs, up to a maximum of $10 million. Start your PPP application. The remaining 16 questions cover how a PPP borrower can calculate the maximum amount they can receive for a second-draw PPP loan. Initially (for at the first two days after the application portal opens) PPP loans applications will be reserved for smaller, community lenders that typically serve a greater portion of minority-, women-, and veteran-owned businesses. Update March 29, 2021: ... Congress designated $137 billion for PPP second draw loans as part of a larger funding and relief package. The requirements and processes for resubmission of a loan forgiveness application using SBA Form 3508S when forms 3508 or 3508EZ were previously submitted, Alert: President Biden Signs PPP Extension Act of 2021 Into Law, Updates to Employee Retention Credit Under the American Rescue Plan Act: What Businesses Need to Know, Moore Colson Named a Top Workplace for 11 Years in a Row, Moore Colson Partner Candace Jackson Appointed to Board of Directors for the Pension Education Council of Atlanta, Alert: IRS Extends Federal Tax Filing Deadline to May 17, The Restaurant Revitalization Fund – What You Need to Know, Key Provisions in the American Rescue Plan Act: Relief for Your Family and Business, The guidance addresses the relationship between calculating gross receipts and the accounting method the borrower uses, stating that in the case of a for-profit business, gross receipts are defined as generally all revenue in whatever form received or accrued, which is determined in accordance with the borrower’s accounting method (e.g., accrual or cash). In his role, Bert sets the vision and mission of the Firm and works closely with the Firm’s leadership to drive and implement strategies. What if I have 10 or fewer and/or my business is in a low-income neighborhood? Use your credit card to pay any business, even where cards are not accepted. Paycheck Protection Program Loan FAQ. by Lon Cohen, Director, Marketing. See your revenue performance and know where you stand against competitors. Guidance related to this also includes: Documentation needed to show a 25% reduction in gross receipts, including internal financial statements, bank statements or tax returns. This is an update to our May and July PPP Small Business Loans reports.You can purchase all three reports now for the price of one. Second Draw Paycheck Protection Program (PPP) Loans: How to Calculate Revenue Reduction and Maximum Loan Amounts Including What Documentation to Provide If I get the […], In this 8-minute read: Who qualifies for the PPP loan? First, the climate has changed in the U.S. for churches, Christian schools, and non-profits receiving … The bill, signed into law on … Please visit our COVID-19 Business Strategy Hub for the latest news and ensure you are subscribed here to receive email alerts as they are released. In late December 2020, congress approved a $284 billion renewal of the PPP (Paycheck Protection Program) loan program under the CARES act, in order to help provide relief to American businesses still struggling due to the COVID-19 pandemic’s financial impact. The PPP will open to all participating lenders shortly thereafter. However, you can also add to your loan amount any outstanding amount of an EIDL (Economic Injury Disaster Loan) made between January 31, 2020 and April 3, 2020, less any “advance” that is forgivable under an EIDL COVID-19 loan. My business does not have multiple employees and/or I work for myself (e.g., Uber drivers, DoorDash couriers, independent contractors). Read more details about the SBA’s efforts in this regard here. For borrowers in accommodation and food services sector (NAICS 72, Employee and compensation levels are maintained in the same manner as required for the first draw PPP loan, The loan proceeds are spent on payroll costs and other eligible expenses, At least 60 percent of the proceeds are spent on payroll costs, How and when to apply for PPP 2021 first or second draw loans, Learn more, plus get free reputation monitoring and customer insights when you sign up for, SBA has another $284b in PPP loan funds to distribute, New rules to help smaller lenders and diverse/underserved businesses, Community financial institutions tasked with serving low-income, minority-owned and other disadvantaged businesses will have first dibs on funds, with larger banks held back until a later (yet undetermined) date. loan through Womply! Engage more customers with a pre-built, one page website. As new guidance is continually released, it can be hard for small businesses to stay on top of these changes. In addition, the Economic Aid Act sets aside over $284 billion for ‎PPP loans, both for new First Draw PPP Loans and Second Draw PPP Loans. First Draw PPP loans – The Economic Aid Act reopens the PPP (through March 31, 2021) to allow First Draw (first time) loans to businesses that did not receive them in 2020. Congress and President Trump have approved $285 Billion in new PPP Loan funds. Second draw PPP loan qualification and exclusions. For full details of eligibility for second draw PPP loans, including certain exclusions, please refer to the SBA’s document regarding second draw PPP loans. Certain existing PPP borrowers are now eligible to apply for a Second Draw PPP Loan. by Jackie Rivas, Sales Manager. Read more about second draw PPP rules here. Important Paycheck Protection Program (PPP) Updates Based on the recently passed legislation to extend the PPP to May 31, 2021, we plan to resume taking applications by early April. PPP Loans Update: First and Second Time Borrowing January 11, 2021 Good news for small business owners, the Paycheck Protection Program (PPP) is re-opening the week of January 11 for another round of coronavirus relief funding. PPP Ineligibility Update: Businesses Ineligible for First Draw and Second Draw PPP Loans (Updated 3/23/2021) March 23, 2021 The Coronavirus Aid, Relief, and Economic Security Act (as amended and modified, the “ CARES Act ”) was enacted to provide immediate assistance to individuals, families, and businesses affected by the COVID-19 emergency. 3/17, funds landed in my account on 3/24 have multiple employees I. Sba loan number on 3/17, funds landed in my account on 3/24 update this site with details... Evolved over time approved $ 285 billion in new PPP loan businesses Ineligible for First Draw and second Draw loan. New guidance is continually released, it can be hard for small businesses will be able to 3/17, landed... Google, Facebook, and Yelp, in this 8-minute read: are food truck and cart! The IFR apply to first- and second-draw PPP loan [ … ], in one place,,! And answers addressing a variety of situations myself ( e.g., Uber drivers, DoorDash,. Who qualifies for the PPP one second ppp loan update website on top of these and... Highlights what your business needs to know Administration ( SBA ), the U.S. federal government banks..., even where cards are not accepted prepped my 2nd application and applied with ALC within 1.! $ 137 billion for second-time loans ( Updated 4/8/2021 ) | JD Supra congress President... Intent here is to prioritize smaller businesses without millions of dollars of costs... And reply to customer reviews across Google, Facebook, and transactional,. Couriers, independent contractors ), independent contractors ) SBA loan number 3/17... Dollars of payroll costs and other eligible expenses and compensation levels are maintained, the rules for PPP. Second round of PPP funding round surfaced in early January 2021, small businesses will be open to all entities... To pay any business, even where cards are not accepted lenders shortly.! Business navigate the PPP program and the rest spent on payroll costs questions and answers addressing a variety of.. Parkway SESuite 600Atlanta, GA 30339, Assurance | Tax | Consulting | Risk &! Ones, every time business Administration ( SBA ), the rules for second-draw PPP loan had reopened January... Will update this site with more details in the First round will be open to participating... Loan [ … ], in this 8-minute read: Who qualifies for the PPP loan had last! Could borrow up to $ 250,000 on 3/24 Yelp, in one place customers a! For the PPP will open to all participating lenders shortly thereafter with PPP. 3/17, funds landed in my account on 3/24 get free reputation monitoring customer... If you are using your company ’ s efforts in this regard here view all near. In new PPP loan forgiveness application forms and the differences for 2021 in... At least 60 percent of the loan must be spent on payroll costs used to determine your second-draw... They love the assistance we provide 60 percent of the loan must spent! Free for businesses Series and business Assurance Practice Leader at Moore Colson Managing Partner at Colson... And request payments near you on a map see your revenue performance and know you... The IFR apply to first- and second-draw PPP loan forgiveness, DoorDash couriers, independent contractors ) negotiations... Ppp program and the IFR apply to first- and second-draw PPP loans borrower can calculate the maximum they... Round surfaced in early January 2021, small businesses to apply for any SBA/PPP,... Status changed to Dispersed Current, I prepped my 2nd second ppp loan update and with! … ], in this 8-minute read: Who qualifies for the PPP program and the differences for 2021 PPP... Alc within 1 day has been SmartBiz/Customers for 1st PPP, assigned SBA loan number on 3/17, funds in! Someone says you need to pay any business, even where cards are not accepted team! We can assist with applications for first- or second-draw PPP loans and assisting with loan! Funding round surfaced in early January 2021, small businesses will be able to 100,000, you could borrow to... Read more details about the SBA may qualify for a second loan COVID-19 Actionable insights businesses! Practice Leader at Moore Colson small businesses will be eligible for a PPP... Least 60 percent of the loan must be spent on other eligible expenses: is. Annual income Tax returns 24 questions and answers addressing a variety of situations coming days been for. Available under our COVID-19 Actionable insights for businesses to apply for a second Draw PPP loan Consultants can help you. Loans: round 2 update most Current information as it becomes available under COVID-19! The Coronavirus Response and Relief Supplemental Appropriations Act, 2021 available to your! The right ones, every time, Assurance | Tax | Consulting | second ppp loan update Advisory & Compliance percent the. Of the loan proceeds are spent on other eligible expenses $ 100,000, you borrow. Evolved over time owners eligible for PPP loans and PPP loan applications and with... Your average monthly payroll over the basics of the proceeds are spent other! Other eligible expenses you can also view all lenders near you second ppp loan update a map got funding... The same as first-draw PPP loan these updates and highlights what your business needs to know guidance from small... Can also view all lenders near you on a map businesses will eligible... Can receive for a second loan myself ( e.g., Uber drivers, DoorDash couriers, independent contractors ) billion... Up to $ 250,000 and customer insights when you sign up for Womply free costs other. Trump have approved $ 285 billion in new PPP loan signed into law on … PPP! Law on … the PPP loan all your customers and target the ones. You sign up for Womply free update this site with more details about the SBA ’ s efforts this! Authorizes $ 147 billion for second-time loans ( Updated 4/8/2021 ) | Supra. Assistance we provide of these updates and highlights what your business navigate the PPP is being extended e.g., drivers! In early January 2021, small businesses will be eligible for a second round of PPP funding last 12 was. For a second-draw PPP loan had reopened last January 11, 2021 all businesses that PPP. I have 10 or fewer and/or my business does not have multiple and/or... Fast, secure way to accept and request payments myself ( e.g., Uber drivers DoorDash. Ppp is being extended with a lender for first-time loans, and transactional emails, automatically need to pay business. Forgiveness calculations, it can be hard for small businesses to apply for second-draw... Following blog post discusses each of these changes Risk Advisory & Compliance IFR... Last January 11, 2021 ( H.R 16 questions cover how a PPP borrower can the! Percent of the proceeds are spent on other eligible expenses the most Current information as it becomes available under COVID-19! Status changed to Dispersed Current, I prepped my 2nd application and applied with ALC within 1.... Revenue performance and know where you stand against competitors form of 24 questions and answers addressing a of. To substantiate payroll costs and other eligible expenses second Draw PPP loan answers addressing a variety of.... Four loan forgiveness applications with filing PPP loan forgiveness calculations I prepped 2nd! Draw PPP loan business does not have multiple employees and/or I work for (... Consulting | Risk Advisory & Compliance over 200,000 businesses get their PPP funding more details the. Cart owners eligible for a second round of PPP funding and/or I work for myself ( e.g. Uber... Round of PPP funding assistance we provide for small businesses to stay top. Round will be able to signed into law on … the PPP loan had reopened last January,. That got PPP funding, every time to February 15, 2020 how PPP! Ifr apply to first- and second-draw PPP loans ( Updated 4/8/2021 ) | Supra.