For questions regarding Paycheck Protection Program (PPP) Forgiveness, visit our PPP Loan Forgiveness Process page. |
On December 27, 2020 Congress signed into law a new round of Paycheck Protection Program (PPP) as part of the $900 billion COVID-19 relief bill. The previous law provided $525 billion in forgivable loans over five months before halting applications in August 2020.
An important change in the new PPP legislation is the opportunity for businesses that previously received assistance to receive additional funding.
Businesses are eligible for a second PPP loan of up to $2 million, provided they have:
You may find additional guidance from the US Department of Treasury on "Second Draw" PPP Loans here.
New PPP loans are also available to first-time borrowers from the following groups:
The legislation also allows borrowers that returned all or part of a previous PPP loan to reapply for the maximum amount available to them. You may find additional guidance from the US Department of Treasury on "First Draw" PPP loans here.
The costs eligible for loan forgiveness in this round of PPP continue to include payroll, rent, covered mortgage interest, and utilities. This new round also considers the following for potential forgiveness:
According to updated Small Business Administration (SBA) guidance, to be eligible for full loan forgiveness, borrowers will have to spend a minimum of 60% of the funds on payroll over a covered period of either 8 or 24 weeks — the same parameters PPP had when it stopped accepting applications in August.
Borrowers may receive a loan amount of up to 2.5 times their average monthly payroll costs in the year prior to the loan or the calendar year, but the maximum loan amount is now $2 million. Borrowers with North American Industry Classification System (NAICS) codes starting with 72 (hotels and restaurants) can get up to 3.5 times their average monthly payroll costs, again subject to a $2 million maximum.
The new COVID-19 relief bill also:
We encourage to you consult your accountant or legal counsel on how these new rules may impact your business. You may find up to date information from the SBA at www.sba.gov/ppp. Should you have any questions about the PPP loan process with Seacoast, please contact us at 866.839.7401.
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