What Are The New PPP Rules?

How does the PPP loan forgiveness work?

PPP Loan Forgiveness.

Borrowers will have their loans forgiven if they use the money for designated expenses.

Participants are eligible for loan forgiveness for the amounts spent on authorized expenses over 24 weeks after loan disbursement (or eight weeks if they choose).

Total payments for payroll may be forgivable..

Can you apply for PPP twice?

Yes! There is no risk in applying with more than one lender. According to our lending partners, the SBA’s system will accept the first valid application that arrives, and automatically rejects subsequent ones. … The lender is able to send you closing documents and use the PLP to complete the loan process.

How can I get my PPP forgiven?

Use the following tips on how to make sure your PPP loan is forgiven to get started:Use it for eligible expenses.Keep your employee headcount up.Don’t reduce an employee’s wages by more than 25%Document everything.Talk with your lender.Apply for loan forgiveness.

Is there another round of PPP coming?

Once the SBA issues the regulations, the program will officially reopen and run through March 31, 2021. The legislation also ensures that business expenses paid with forgiven PPP loans are tax deductible. It also clarifies that PPP loans will not be included in taxable income.

Should I wait to apply for PPP forgiveness?

Most Paycheck Protection Program (“PPP”) borrowers are working toward full forgiveness of their PPP loans and are anxious to get this process started. … But that does not mean a borrower should submit a loan forgiveness application as soon as possible.

Are PPP loans still available?

The Paycheck Protection Program has about $130 billion in remaining funds. … Small-business owners won’t be able to access that money after June 30, however. There are other options available to ailing businesses, but they may be limited or come with unfavorable terms.

Who qualifies for second PPP loan?

To be eligible for a second PPP loan, you must show a loss in revenue in 2020. This is proven by showing a 25% (or more) reduction in gross receipts from any quarter in 2020 relative to that same quarter in 2019.

How much of the PPP money is left?

about $130 billionThere’s about $130 billion left in the PPP pot. Why small businesses are slow to claim cash. It took less than two weeks for the Paycheck Protection Program to run out of funds when it first opened to small businesses on April 3.

How do I calculate my PPP loan?

How PPP loans are calculated. PPP loans are calculated using the average monthly cost of the salaries of you and your employees. But if you’re a sole proprietor, your PPP loan will be calculated based on your business’ net profit. Your salary as an owner will be defined through the way your business is taxed.

What documents are needed for PPP forgiveness?

For the payroll portion of your PPP loan, you will need to provide documents from your payroll provider and proof of paying employment taxes with IRS and state forms. Eligible payroll costs include salaries and wages, health benefits, and paid leave (i.e. vacation, parental, family, medical, or sick leave).

How long do I have to apply for PPP forgiveness?

You must apply for forgiveness within 10 months after the end of the ‘Covered Period. ‘ which is the 24-week period that starts when you received your PPP loan. The lender (i.e. your bank) has 2 months to process your loan forgiveness application then SBA has three additional months to approve your forgiveness.

What are the new rules for PPP loan forgiveness?

To be eligible for full loan forgiveness, PPP borrowers will have to spend no less than 60% of the funds on payroll over a covered period between eight or 24 weeks.

Who is not eligible for a PPP loan?

Passive businesses owned by developers and landlords that do not actively use or occupy the assets acquired or improved with the loan proceeds (except as Eligible Passive Companies under 13 CFR § 120.111) are not eligible.

When can I apply for second round of PPP?

Program will be open to new borrowers on January 11, and for 2nd draw borrowers on January 13. Applicants must have utilized the full amount of their initial draw PPP loan on or before the expected date of the second draw PPP loan is disbursed.