Small businesses that experienced a loss of revenue from 2019 to 2020 may be eligible for a second round SBA-PPP (“Paycheck Protection Program”) loan. You may also be eligible if you were not operational during 2019 or a portion of 2020. The SBA has established criteria to determine eligibility, generally as follows:
A borrower is generally eligible for a Second Draw PPP Loan if the borrower:
- Previously received a First Draw PPP Loan and will or has used the full amount only for authorized uses,
- Has no more than 300 employees, and
- Can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020.
If you did not apply for a SBA-PPP loan during the first round, you may still be eligible. You would qualify based on the rules of round one.
You can apply for 2.5 months of average payroll. If you are in the hotel, restaurant, or “other accommodation and food services business” you would be able to apply for 3.5 months of average monthly payroll. Forgiveness of the loan is not taxable income for federal income tax purposes. You can apply through March 31, 2021 for these PPP loans. Do not hesitate to contact us, or your local bank, with any questions you may have regarding eligibility or process. Additional details are also available at SBA-PPP.