Paycheck Protection Program (P3) Loans- Round 2
Paycheck Protection Program (P3) - Round Two
The Consolidated Appropriations Act of 2021 (“CAA” H.R. 133) passed Congress and was signed into law on December 27th, 2020. The CAA package includes a second round of funding for the Paycheck Protection Program (PPP), provides new and additional economic assistance for American workers, families, and small businesses.
Business Impact NW is dedicated to helping our community’s small businesses get the support and funding they need during this pandemic. Our mission is to assist those businesses that may be underserved or otherwise have difficulty accessing support and funding. Our dedicated team is available to assist you whether you already have received PPP or wish to apply for new or additional funds.
On February 22nd President Biden announced several reforms to the current Paycheck Protection Program, in an effort to support small businesses that haven't been able access much needed financial relief. These changes will primarily benefit business owners with little to no employees, located in low income neighborhoods, and/or sole proprietors, independent contractors and self-employed individuals. Additionally, they will eliminate restrictions regarding business owners who:
- have a felony record
- are delinquent on their student loans, and/or
- are non-citizens who are lawful U.S. residents
Starting on Wednesday, February 24, 2021, there will be a 14-day period during which only businesses with fewer than 20 employees can apply for relief through the PPP. Applicants are welcome to use their Individual Tax Payer Identification Number (ITIN), as opposed to an Employer Identification Number (EIN), or Social Security Number (SSN). Additionally, sole proprietors may now apply using their Gross Receipts / Sales on their 2019 or 2020 Schedule C, as opposed to their Net Earnings on their 2019 or 2020 Schedule C.
Should you decide to apply with Business Impact NW, please register for our waiting list here. We also encourage you to schedule a one-on-one coaching session with your Business Impact NW coach to assist you as needed.
Learn more about President Biden's Paycheck Protection Program Equitable Access reforms here.
What you need to know about PPP-Round 2:
- The deadline for second round PPP applications has been extended until May 31st, 2021.
- Businesses are eligible to receive a second forgivable loan if they:
- employ 300 employees or less;
- have used or will use the full amount of their first PPP;
- and demonstrate at least a 25% reduction in gross receipts in any quarter in 2020 compared to the same quarter in 2019.
- Small business owners can also apply for an initial PPP loan.
- Simplifies the forgiveness application for loans under $150,000.
- Allows borrowers to specify a covered period between 8 and 24 weeks
- Expands eligible expenses
- Businesses in the restaurant and hospitality industries are eligible to receive loans of 3.5 times average monthly payroll, rather than 2.5 times.
The SBA, in consultation with the U.S. Treasury Department, has opened the Paycheck Protection Program loan portal on Monday, Jan. 11, 2021 at 9 am ET. On January 11th First Draw PPP loan applications from participating CFIs, like Business Impact NW will be open. A First Draw PPP loan is for those borrowers who have yet to receive a PPP loan before the program closed in August 2020. If you are interested in applying for a First Draw PPP loan click here to indicate your interest and a member of the Business Impact Lending Department will contact you directly.
For current Business Impact NW PPP borrowers, Second Draw PPP Loans will open up to you on Wednesday, January 13th 2021. The SBA is giving priority to community lenders such as Business Impact NW over other lenders, so you will get priority. A Second Draw PPP loan is for certain eligible borrowers that previously received a PPP loan, generally have 300 employees or less, and has suffered a 25% reduction in gross receipts. See this PPP Second-Draw infographic for more information on eligibility requirements.
Business Impact NW can help small businesses with applications for the P3 program. Our in-house COVID Response Team, business coaches, and loan officers are preparing to support this new wave of federal support.
The SBA offers free counseling and training events to help you with the Paycheck Protection Program, learn more about the free resources to support you PPP application provided by the SBA here.
Curious about the status of your PPP application? For borrowers who have had their PPP application submitted to the SBA by their lender, you can create an account in the SBA Capital Access Financial System (or CAFS) to monitor their loan status. Learn more here.