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01/13/2021 | Press release | Distributed by Public on 01/13/2021 09:22

SBA announces terms for new round of PPP funding

posted on Wednesday, January 13, 2021 in Newsroom

We have exciting news! The U.S. Small Business Administration (SBA) announced this January the terms for a new round of funding for the Paycheck Protection Program (PPP). This round is open to both new and existing PPP borrowers.

FIRST DRAW: If you have not received PPP funds before, you maybe be eligible to apply now. Small businesses, farmers, non-profits, veterans' organizations, tribal concerns, self-employed individuals, sole proprietorships, and independent contractors can apply.

SBA Form 2483 First Draw Overview
SBA Form 2483 First Draw Application

SECOND DRAW: If you received PPP funds before, you may be eligible for a Second Draw PPP funding.

SBA Form 2483-SD Second Draw Overview
SBA Form 2483-SD Second Draw Application

Calculating your Second Draw PPP Loan

  • 2.5 times your average monthly payroll with a maximum loan amount of $2 million.
  • The average monthly payroll is calculated by using 2019 or 2020 total payroll expenses divided by 12.
  • When calculating payroll costs, the borrower must subtract any compensation paid to an employee in excess of $100,000 on an annualized basis.
  • If the borrower has a NAICS code beginning with 72 (hospitality, restaurants, etc.), the calculation is 3.5 times the average monthly payroll costs.
  • Schedule F (Farmers), the maximum loan amount is obtained by dividing the borrower's gross income as reported on 2019 or 2020 Schedule F that is not more than $100,000 divided by 12 and multiplied by 2.5. ($20,800 max).

Eligibility requirements for Second Draw PPP

  • Previously received a First Draw PPP Loan and will or has used the full amount of that loan.
  • Has no more than 300 employees; and
  • Can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020, or on an annual basis.