04/08/2020 | News release | Distributed by Public on 04/08/2020 14:27
At 880 pages and an estimated cost of $2 trillion, the CARES Act is a complex and far-reaching piece of legislation for which multiple summaries and analyses are and will be available. For the purposes of Texas community banks, the IBAT team has pulled out the pertinent pieces of the legislation. Please note there are number of areas in which federal agencies will need to provide guidance for some of the provisions of the bill to be finalized. IBAT will continue to provide timely updates as clarity is provided.
Small Business Lending
There is $350 billion allocated for a new 'Paycheck Protection Program' (PPP) through the SBA 7(a) program. As the parameters of this program are extensive, the IBAT team has prepared a separate Q&A document outlining the details of the PPP program as they appear in the CARES Act. It is important to note that the Treasury Department must authorize lenders that are not currently SBA lenders to participate in this program. Details are not yet available on how that authorization will occur.
April 8, 2020 Update on PPP: For your use and convenience, we have developed:
Additionally, we now have available links from the Treasury department to the:
Among other provisions, notable is a five-year, 100 percent NOL carryback for business losses from tax years after December 31, 2017 and before January 1, 2021. More detailed information is available from a plethora of accounting and law firms, as well as information on our COVID-19 Response Page.
Temporary Relief for Community Banks
IBAT was pleased to see a number of (mostly) temporary provisions enacted specifically aimed at community banks. These provisions are all temporary and will remain in effect until 60 days after the emergency declaration is lifted or December 31, 2020. The provisions include: