The Biden Administration recently announced substantial changes to the Paycheck Protection Program (PPP), which provides forgivable loans to businesses struggling during the COVID-19 pandemic. Eligible companies have the opportunity to apply for loans until March 31, 2021.
Notable updates include –
- Now through March 9, there is a two-week exclusivity period for businesses with fewer than 20 employees to apply for first- and second-draw PPP loans. Businesses with more than 20 employees that have not already applied can submit a PPP application between March 9 and 31, 2021.
- The SBA will be issuing a change on calculating the maximum amount of a loan for sole proprietors, independent contractors and the self-employed to be based on gross income (line 7) on their Schedule C forms instead of net income (line 31) which could greatly increase the PPP loan amount for which they qualify.
- The SBA will also improve or expand access to PPP loans to include legal immigrant entrepreneurs who pay taxes but are not U.S. citizens; those in delinquency on student loan payments; and those who have a non-fraud felony but have already served their time.
- The upcoming Shuttered Venue Operators (SVO) grant program — which will distribute $15 billion to live venue operators, including eligible movie theaters, concert spaces, museums, and performing arts organizations — is still expected to launch shortly.
Any business that is eligible for PPP should get their application in as soon as possible, in case money runs out or the system is overwhelmed by a rush of last-minute applicants at the end of March.