- Nicole Palazzolo
PPP Loan January Update
Second Draw of a PPP Loan According to the Interim final rule released by the SBA, here are some highlights pertaining to the Second Draw of PPP Loans. Please reach out if you would like the full file issued by the government.
Here's what you need to know:
Applicants must submit to the lender SBA Form 2483-SD (Paycheck Protection Program Second Draw Borrower Application Form) This form is not online as of yet.
You can choose to use 2020 payroll costs (which you would only want to do if higher than 2019). Notes: 1) If using 2020 payroll costs, you will need to provide 941s, Payroll Summary Reports, and other items as requested to prove the 2020 calculation of payroll costs (just the same as the first draw of PPP funds) 2) No additional documentation to substantiate payroll costs will be required if the applicant used year 2019 figures to determine its Second Draw amount
For loans with a principal amount greater than $150,000 the applicant must also submit documentation adequate to establish that the applicant experienced a revenue reduction of 25% or greater in 2020 relative to 2019 (which may include relevant tax forms, including annual tax forms, or, if relevant tax forms are not available, a copy of the applicant’s quarterly income statements or bank statements.)
For loans with a principal amount of $150,000 or less, such documentation is not required at the time the borrower submits its application for a loan, but must be submitted on or before the date the borrower applies for loan forgiveness, as required under the Economic Aid Act
First Draw of a PPP Loan: If you did not previously apply for a PPP Loan, you can do so now for the first time! Loan Forgiveness: MOST lenders have not begun accepting loan forgiveness applications. I have also received communication that lenders previously accepting applications have put forgiveness applications on hold for now. Please rest assured that we have plenty of time to apply for forgiveness and that we will be prepared to assist you with loan forgiveness when the time is appropriate to do so. What's Next? I'm working with my clients now to assist you with PPP loans and have reached out directly to review your revenue and payroll cost compairsons.
If you did not previously receive a PPP Loan and would like to apply for the first time, please contact me ASAP!