The PPP round 2 is scheduled to close on March 31st!
FORGIVENESS – For first-round loans, all borrowers have been sent a forgiveness application to sign electronically. The SBA has forgiven 100% of the loans applied to date.
TAX IMPLICATIONS – You need to work directly with your CPA on this, but under the new Act, for 2020 taxes, PPP funds, and forgiven loans are not included in income. The expenses for which you spent the PPP are still allowable as deductible expenses. In effect, the receipt of a PPP is disregarded for tax purposes in both income and expenses.
IF YOU DID NOT RECEIVE A PPP in 2020 – We are taking applications for a FIRST DRAW PPP – meaning you did not receive a PPP previously. You do not have to meet the revenue reduction requirement of the new Act. The calculations of loan amounts are still 2.5 times the average monthly payroll.
IF YOUR BUSINESS HAS STILL BEEN IMPACTED – A SECOND DRAW PPP is available for businesses that already received a 2020 PPP and meet these criteria: Must have had a reduction of 25% or more in gross receipts in any quarter of 2020 when compared with the same quarter of 2019. The amount of any forgiven First Draw PPP Loan shall not be included toward any borrower’s gross receipts. For NAICS codes beginning with 72 (mostly restaurants), the PPP factor is 3.5 times monthly payroll rather than 2.5. We are taking applications for a SECOND DRAW PPP.
IF YOU ARE A SOLE PROPRIETOR – You now qualify based on Gross Income rather than net. You may have been turned down for a PPP in 2020 because you showed negative net income, but you can now apply for both a first and second draw loan based on GROSS INCOME.
HOW TO APPLY? There are new forms for all applications. Because we must send you the appropriate form, please email [email protected]com