Disclaimer: This is based on information available as of January 14, 2021. The SBDC will continue to update their site as more guidance and information is available.
Congress has reauthorized funding for the Paycheck Protection Program (PPP) through the Economic Aid to Hard-Hit Small Businesses, Non-Profits, and Venues Act (Economic Aid Act).
While many provisions of the program are the same as when the program was first passed in March last year, there are several important differences. One of the key changes is that businesses who have previously received a PPP loan are now eligible for a second loan.
Read more for more information and key updates to the program.
What is the PPP?
The PPP is a loan program that originated from the Coronavirus Aid, Relief and Economic Security Act (CARES) Act to help small businesses keep their workforce employed during the coronavirus pandemic.
On December 27, 2020 a second stimulus package was signed into law that provided an additional $284.45 billion to reopen the PPP program and allow businesses that used up their first PPP loan to apply for a second.
Am I eligible?
Borrowers in operation on February 15, 2020 and meet one of the following requirements may be eligible:
A borrower is generally eligible for a second loan if the borrower:
What can a PPP loan be used for?
At least 60 percent of the loan must be used for payroll and employee benefits costs.
Payroll costs under the PPP include:
How much can I receive?
For first-time applicants, the maximum amount you can receive is the lesser of $10 million or an amount that you will calculate using the payroll-based formula below.
For second-time applicants, the maximum is the lesser of $2 million or an amount that you will calculate using the payroll-based formula below.
How do I calculate my loan amount?
The maximum loan amount is:
When can I apply?
The SBA and Treasury announced Friday, January 8th that the new PPP will re-open the week of January 11 with community financial institutions exclusively allowed to make first-draw PPP loans on starting January 11 and second-draw PPP loans starting January 13.
The PPP will open Friday, January 15 to PPP-eligible lenders with $1 billion or less in assets for first and second-draw applications. The portal will fully open to all participating lenders on Tuesday, January 19.
What’s the application deadline?
March 31, 2021
How do I apply?
Contact your local bank, credit union, or other SBA-certified lender to apply or for more information.
Note: You do NOT have to apply for a second PPP loan with your original lender, however please be aware that it may expedite the process if you do so.
If you wish to begin preparing your application, you can download the following prior to applying with your lender:Additional Rules and GuidanceSBA has issued the following Interim Final Rules related to the PPP:
Need more information?
Visit www.sba.gov/ppp or www.treasury.gov/cares for more information and details, including the comprehensive program rules.
For application status inquiries and/or questions about the loan program:
Please contact the SBA at 1-800-659-2955 (TTY: 1-800-877-8339) or firstname.lastname@example.org.
For assistance with completing an application:
Our Florida SBDC disaster recovery specialists provide one-on-one confidential consulting at no cost to help businesses prepare disaster loan applications and assist with other post-disaster challenges. Please note that consultations are taking place via phone call or virtual meeting. Due to the COVID-19 pandemic, we are experiencing high volumes of calls, emails, and requests for consulting. We will work to respond to your request as quickly as possible. We ask that you remain patient during this time and we’ll be in touch with you as soon as possible.
Find your local SBDC office by clicking here.
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