Posts Tagged ‘PPP Loan’

Are you currently a Paycheck Protection Program (PPP) borrower considering eligibility for an Employer Retention Credit (ERC)? If so, the Consolidated Appropriations Act, 2021 may now provide you with an opportunity to claim this credit. ERCs can now be retroactively claimed by PPP borrowers for the year 2020 and subsequently, in 2021.In Section 206 of the Act, the ERC was expanded to include PPP borrowers as claimants, and the credit can now be backdated to March 12, 2020. Employers are permitted to claim a credit of 50% of qualified wages, in which the qualified wage paid to each employee is… read more »

On January 8, 2020, the U.S. Department of Treasury and U.S. Small Business Administration (SBA) reported that the Paycheck Protection Program (PPP) restarts this coming week. As soon as Monday, January 11, commencement for first-time borrowers and various existing borrowers will ensue. Solely community financial institutions are eligible to withdraw PPP loans on Monday, January 11. The second withdrawal of PPP loans will be disbursed on Wednesday, January 13 – this order of distribution is expected to bolster capital accessibility. Consequently, all remaining PPP lenders will be permitted to participate. Visit the SBA website for more information AttorneyIf you or someone… read more »

With the newly authorized Consolidated Appropriations Act, 2021 (the “Act”), Congress has agreed to allot $284.5 billion to the Small Business Administration (SBA) for Paycheck Protection Program (PPP) loans. In this second round, prior PPP recipients may borrow up to $2 million – a significant decrease from the $10 million maximum permitted by the CARES Act; the bill specifically allocates $35 billion to new PPP borrowers.  New Information on Expenses  Section 276 of Division N in the new bill provides that these expenses are now wholly deductible for those who paid business expenses with forgiven PPP funds. The new bill… read more »

The Treasury released a new Interim Final Rule (IFR) regarding owners compensation and limitations on forgiveness eligibility (see link below). PPP – Treatment of Owners and Forgiveness of Certain Nonpayroll Costs Owner Compensation. Owner-employees with less than a 5% ownership interest in a C or S-corp are not subject to the owner-employee compensation rules.   There are no exceptions to this rule, since the Treasury has determined that owners with less than 5% ownership have no “meaningful ability to influence decisions over how loan proceeds are allocated”. Compensation Limitations. The amount of loan forgiveness requested may not include business operations of… read more »

Small Business Administration (SBA) lenders have the opportunity to review the basics of PPP loan forgiveness and the SBA’s PPP Loan forgiveness platform on Thursday, August 27, 2020, at 11:00 a.m. On that day, the Federal Reserve System, Office of the Comptroller of the Currency (OCC), Federal Deposit Insurance Corporation (FDIC), Conference of State Bank Supervisors (CSBS), and the National Credit Union Administration (NCUA) will host an interagency webinar for all SBA lenders who participated in the SBA PPP lending program.  During the webinar, interagency officials will give an overview of the SBA Paycheck Protection Program (PPP) Loan Forgiveness Platform. Provide… read more »

The SBA just released additional guidance on Paycheck Protection Program (PPP) Loan forgiveness in the form of Frequently Asked Questions and answers. The PPP resumed accepting applications July 6, 2020, and will continue until August 8, 2020. The SBA will forgive loans if the funds are used for employee retention and eligible expenses.  FAQs about PPP Loan Forgiveness (8/4/2020) Loans used for payroll costs, rent, interest on mortgages, and utilities will be fully forgiven. (At least 60% of the forgiven loan must have been spent on payroll.) Other important details include: –    PPP loans have a 1% interest rate and payments will be… read more »

Guidance on PPP Issues The Small Business Administration (SBA) have provided guidance on PPP issues as they provide more information and answer questions. This article will cover the following topics: Calculating Maximum Loan Amount by Business Type IFR regarding Calculation of Payroll Costs of Certain Fishing Boat Owners IFR Additional Eligibility Revisions to First Interim Final Rule regarding Felony Convictions Updated FAQ’s The Small Business Administration (SBA) have provided guidance to assist businesses in calculating payroll costs to determine the amount of a Paycheck Protection Program (PPP) loan for which they may apply. Follow the link below to learn more…. read more »

When a government agency such as the SBA has good reason to issue a final rule before publishing a proposed rule, it issues the rule as an “interim final rule,” or “interim rule.” Interim rules becomes effective as soon as they are published. The SBA’s new Interim Final Rules (described briefly below) were created to implement the PPP Flexibility Act and offer additional guidance to both borrowers and lenders. On June 5, 2020, the PPP Flexibility Act, which amended the CARES Act (see above), was signed into law. This IFR changed key provisions in the CARES Act such as deferral of loan payments, loan maturity, and forgiveness provisions. The provisions… read more »

The U.S. Small Business Administration (SBA) and the Department of the Treasury posted a revised Paycheck Protection Program (PPP) loan forgiveness application that is more borrower-friendly.  The SBA, in addition to revising the full forgiveness application, has also published a new EZ version of the forgiveness application. Are self-employed with no employees; ORDid not reduce the wages or salaries of their employees by more than 25%, and did not reduce the hours of their employees; ORExperienced reductions in business activity due to COVID-19 health directives and did not reduce the wages or salaries of their employees by more than 25%. … read more »

President Trump signed the Paycheck Protection Program Flexibility Act of 2020 (H.R. 7010) .  This bill modifies several provisions regarding the forgiveness of loans to ease usage restrictions and increase the time businesses are able to utilize PPP funds. Major provisions of the bill include:   An extended forgiveness period, which gives businesses the option to extend the covered period from the original eight weeks to twenty four weeks beginning on the date of origination of a covered loan to December 31, 2020 (twenty-four weeks). An extension of the Jun 30th safe harbor for rehiring employees. A reduced payroll spending requirement from 75% to 60%. An extended… read more »