UPDATE April 16, 2020: The SBA announced they are no longer accepting applications for the Paycheck Protection Program (PPP) loans due to funding limits being reached. See PPP Loan Updates for a timeline of milestone changes. Drop reference to forgiveness application to avoid confusion with applications.
There were three loan rounds of funding available during the PPP loan timeframe that allowed for borrowing of funds, which were referred to as "draws." The deadline to apply for a first draw PPP loan (round 1) was initially June 30, 2020; later extended to August 8, 2020.
The deadline for rehiring workers in order to qualify for safe harbor from the reduction factors was moved from June 30, 2020 to December 31, 2020. Employers can exclude from the FTE Reduction Factor calculation any positions that, during the period between February 15 and December 31, they were unable to fill because they either could not find qualified employees to hire, or, could not restore their business to a comparable level of activity because of social distancing or other federal health guidance.
For new loans issued after this amendment takes effect, the payback period for any unused funds was extended from two years to five years, with repayments to begin upon receipt of a final forgiveness determination from the SBA. For existing loans, it is up to the borrower and lender to agree to an extension to five years.
Instructions for applying for a PPP loan is as straightforward as filling out the loan application and submitting to an SBA participating lender. However, the application must be filled out properly in order to be eligible for loan approval. To start the application, you can get started one of two ways; either inquire at your local bank or request Armanino to assist you with the application and subsequent compliance process.
Consider gathering the following Information to ensure a smooth process:
The this time there is no plans for another round of loans. However, other programs are available for those hardest hit businesses to recoup lost revenue including Shuttered Venue Operators Grant (SVOG) for theathers, music venues and other like businesses, Restaurant Revitilization Fund to help these food-based businesses survive and the COVID-19 Economic Injury Disaster Loans which provide up to 24 months of relief and a maximum loan amount of $500,000. Unfortunately, they do not have the same forgiveness stipulations attached to them and must be repaid; however, the time is lengthy and interest rates low.